After the news broke yesterday that Novartis ($NVS) was to cut a slew of workers from its gene and cell therapy programs, this has left many wondering about its broader pacts in this space--and their future. GenVec ($GNVC), which is developing a hearing loss gene therapy with the Swiss major, was quick to say it will not be one of those axed.
In a brief statement released after the news broke about Novartis’ plans, GenVec filed a SEC form 8-K explaining: “On August 31, 2016, press reports disclosed that Novartis is planning to eliminate its internal unit dedicated to cell and gene therapy and redeploy most of the affected employees.
“Novartis is developing CGF166, GenVec's lead product candidate for hearing loss, under a Research Collaboration and License Agreement between the two parties. Novartis has informed GenVec that it remains engaged on the CGF166 program and that Novartis's internal changes are not expected or intended to reduce its support for the program.”
Novartis confirmed this week that it plans to cut its internal unit dedicated to cell and gene therapy. It will redeploy most of the 400 employees from these units, but said about 120 will be cut, according to press reports.
The fact that the GenVec deal remains in place, for now, will be some much needed good news for the biotech, which faces being delisted from the Nasdaq after remaining encamped in penny-stock territory.
Gaithersburg, MD-based GenVec signed a deal worth up to $213 million with Novartis back in 2010 with a focus on CGF166. Its drug was created via the AdenoVerse technology platform that is designed to use genes to treat or stop certain diseases.
The FDA lifted a planned clinical hold on its Phase I/II development in July after an independent body said it was safe for the study to continue. It currently had 9 enrolled patients.
Perhaps prompted by concerns over a potential cutting of the deal, GenVec was down by more than 7% yesterday to 53 cents a share. Novartis, meanwhile, was slightly down by 0.7% at end of play.