Just days after Vical's shares ($VICL) were blitzed by the news that its cancer immunotherapy Allovectin was being scrapped after flunking a Phase III, about 40% of the company's staffers paid for the failure with their jobs.
Vical CEO Vijay Samant said 47 jobs are being axed, leaving the San Diego-based biotech with 74 employees.
"We have evaluated our organization and priorities and are restructuring to extend our cash runway to ensure that our promising infectious disease vaccine programs are adequately resourced to create maximum shareholder value," said
Vical was left with $70 million in the bank, which it said prior to the layoffs was enough to sustain its operations through 2014. After the cuts, the company said it could get by through 2015.
Vical quickly shifted gears a little more than a week ago to focus on Astellas' recently launched late-stage study of ASP0113, a therapeutic vaccine designed to control cytomegalovirus, or CMV, for recipients of hematopoietic cell transplants and a Phase II trial of ASP0113 for solid organ transplants slated to launch later this year. The company is planning to initiate a Phase I/II clinical trial of its Vaxfectin-formulated therapeutic vaccine against herpes simplex virus type 2 before the end of 2013.
Small developers like Vical have an abysmal record at late-stage cancer drug studies. The Feuerstein-Ratain rule concluded some time ago that microcap biotechs have a steady track record of failure in Phase III. Vical adds another notch in that belt.
Vical shares were trading at $1.31 today.
- here's the press release