Five Prime cuts workforce by 20% in restructuring
- Five Prime Therapeutics is cutting 41 jobs — mostly in research, pathology and manufacturing — to channel resources toward its pipeline of experimental cancer drugs.
- The move will save $10 million in fiscal year 2019, with more savings in future years, Five Prime said. The company expects to take pre-tax charges of about $2 million in the first quarter of 2019 to cover severance and other costs.
- The South San Francisco, California-based company expects to finish 2019 with between $148 million to $153 million in cash, equivalents and short-term securities, after closing out last year with $270 million in liquid holdings. That money should be "sufficient to fund programs through multiple data readouts," according to Five Prime's Jan. 15 statement.
The biotech is freeing up cash to make sure it can capitalize on a pipeline that includes five cancer treatments in clinical testing.
One of those therapies, cabiralizumab, is being tested in two different Phase 2 studies in partnership with Bristol-Myers Squibb. Another, bemarituzumab, is in a Phase 3 combination trial as a treatment for gastric cancer.
"This was a hard decision to make, but we believe that effective use of capital is crucial to supporting our strong pipeline of anti-cancer drug candidates," Five Prime CEO Aron Knickerbocker said in the company's statement. "We remain committed to successfully executing our clinical trials and advancing our later-stage research programs with the same intensity and quality for which Five Prime is known."
The company's pipeline also lists preclinical research into immuno-oncology antibodies in various tumor types.
Five Prime said the cuts will affect about 20% of its current workforce. At the end of 2017, the company reported having 216 full-time employees. It said it will also take a "disciplined approach" to any future hiring.
The company's share price sat at about $10 Wednesday. A year ago, shares topped $20.