|Regado CEO David Mazzo|
Regado had all of its eggs in one basket when it took its lead therapy into a Phase III trial on its own. And now that the anticoagulant study has been shelved after signs of a severe allergic reaction were seen among patients, the biotech is cutting more than half of its staffers in an effort to preserve cash and review what kind of moves it can still make.
The Basking Ridge, NJ-based biotech ($RGDO) said Wednesday evening that it pink slipped 20 employees, 60% of the staff, as it signed on a few advisers. There will be about $61 million in the bank at the end of this month, and Regado says it needs to conserve as much as possible as it tries to find a way out of the mess it's in.
At last count, the biotech's market cap was a mere $34 million, less than the cash it has on hand.
Regado bet the farm on Revolixys (REG1), which uses two agents--pegnivacogin and anivamersen--to control bleeding during a coronary intervention and open heart surgery. The biotech hoped the $150 million Phase III study would prove that the combo could give physicians a tool to manage coagulation, "dialing" the anticoagulation effect up or down to enable doctors to safely hit a maximum dose for each patient. Back in late 2012, Baxter's venture arm allied with Rusnano to lead a $51 million round for the company, with cash from Edmond de Rothschild Investment Partners, Domain Associates, Quaker Partners, Aurora Funds and Caxton Advantage Life Sciences Fund.
An IPO, though, misfired, raising far less cash than what was needed at the time to complete the Phase III. Now, with the trial terminated, many of the company's investors would probably like as much of that cash back as they can get.
"The termination of REGULATE-PCI led us to important business decisions," said Regado CEO David Mazzo in a statement. "The workforce reduction was a necessary action to conserve working capital and provide maximum flexibility in determining the future direction of Regado … In addition to these operational changes, we have initiated a campaign to evaluate a broad range of strategic alternatives that could maximize returns for Regado shareholders in the near future."
- here's the release