Medivir (STO:MVIR-B) is taking the ax to its R&D team, putting 30 people out of work and narrowing its drug development focus on oncology. The reorganization represents a retreat from early-stage research and infectious diseases, areas Medivir is willing to back away from to save SEK 110 million ($12.5 million) a year.
Stockholm, Sweden-based Medivir made its name developing hepatitis C drug Olysio with Johnson and Johnson ($JNJ), but the fast evolution of that sector has hamstrung both companies' ambitions.
Now, Medivir is getting out of the infectious disease sector altogether. The plan is to start looking for partners for its remaining infectious disease programs by the end of the year, and begin shopping osteoarthritis asset MIV-711 once a Phase IIa is complete. Only oncology assets will survive the cull. In parallel, Medivir is cutting into its early-stage research operation in an attempt to save itself SEK 60 million a year.
“I believe this reduced cost in early research, and a streamlined therapeutic area focus with a smaller and more cost effective organization, will strengthen Medivir´s position as an efficient oncology company with a growing development pipeline. Medivir´s ambition is to have a well balanced and broad pipeline from early to late stages of development,” Medivir CEO Niklas Prager said in a statement.
For now, Medivir is a long way from having a broad pipeline. Medivir’s publicly disclosed pipeline features one cancer program, a discovery-stage nucleotide DNA polymerase inhibitor it is developing to treat hepatocellular carcinoma. But, with Medivir presenting the reorganization as a way to bolster its development capabilities and pipeline of clinical-stage oncology assets, it appears to have plans to expand its slate of programs.
The cuts are the latest event in a rolling reorganization that has occupied Medivir for the past 18 months. In June 2015, Medivir narrowed its research focus on to infectious disease and oncology, shedding a neuropathic pain program and 10 researchers in the process.
The upheaval continued in October, when Medivir merged its research and development units. That action led to the departure of development chief Charlotte Edenius, who became the fifth senior executive to leave in 2015. Medivir also lost its EVPs of finance, corporate and business development and investor relations earlier in the year.
Medivir closed out 2015 by scrapping its collaboration with Cancer Research Technology and revealing J&J had canned development of a hepatitis C drug. J&J’s decision ended Medivir’s hopes of generating further revenues from the agreement.
Since then, Medivir has committed to splitting in two. The reorganization will create a business to sell Medivir’s portfolio of commercial products and a biotech to reboot its fast-thinning pipeline.