XOMA
Announces Workforce Reduction
BERKELEY,
Calif., Jan 15, 2009 -- XOMA Ltd. (Nasdaq:XOMA) announced that it will reduce
its workforce by approximately 42 percent or 144 employees, a majority of which
are in manufacturing. The company expects an annualized reduction of $27 million
in cash expenditures when changes are completed in 2Q 2009. The Company remains
staffed with 197 employees to develop XOMA 052, its anti-inflammatory antibody
drug candidate for the treatment of Type 2 diabetes, develop and license
technology and continue fully funded antibody discovery and development with its
pharmaceutical partners in collaborations and the U.S. government in
biodefense.
"We have
made a difficult, but necessary, decision driven by extremely challenging market
conditions. Although manufacturing was fully utilized in the fourth quarter,
forecasted manufacturing demand in 2009 will not meet expectations. The
reductions are focused on manufacturing and related areas and associated general
and administrative support. Today's actions will bring operating expenses more
in line with expected revenue," said Steven Engle, chairman and chief executive
officer of XOMA.
The
Company has manufactured sufficient quantities of XOMA 052 for planned studies.
Based on encouraging clinical results in Type 2 diabetes, the Company expects to
start a Phase 2 study of XOMA 052 in the second quarter of 2009. The Company
will maintain its pilot scale manufacturing plant and the potential to resume
large scale manufacturing in the future.
Mr. Engle
said, "We appreciate the significant contributions of the employees affected by
today's announcement and are grateful for their efforts and dedication to XOMA's
mission."
The
Company will record a charge in the first quarter of approximately $3 million
for severance and other costs related to workforce reductions.
About
XOMA
XOMA
discovers, develops and manufactures therapeutic antibody and other agents
designed to treat inflammatory, autoimmune, infectious and cancerous diseases.
The company's proprietary product pipeline includes XOMA 052, an anti-IL-1 beta
antibody, and XOMA 3AB, a biodefense anti-botulism antibody
candidate.
XOMA's
proprietary development pipeline is primarily funded by multiple revenue streams
resulting from the licensing of its antibody technologies, product royalties,
development collaborations and biodefense contracts. XOMA's technologies and
experienced team have contributed to the success of marketed antibody products,
including RAPTIVA(r) (efalizumab) for chronic moderate to severe plaque
psoriasis, LUCENTIS(r) (ranibizumab injection) for wet age-related macular
degeneration and CIMZIA(r) (certolizumab pegol) for Crohn's
disease.
The
company has a premier antibody discovery and development platform that
incorporates leading antibody phage display libraries and XOMA's proprietary
Human Engineering(TM) and bacterial cell expression and manufacturing
technologies. Bacterial cell expression (BCE) is a key breakthrough
biotechnology for the discovery and manufacturing of antibodies and other
proteins. As a result, more than 50 pharmaceutical and biotechnology companies
have signed BCE licenses.
In
addition to developing its own products, XOMA develops products with premier
pharmaceutical companies including Novartis AG, Schering-Plough Research
Institute and Takeda Pharmaceutical Company Limited. XOMA has a fully integrated
product development infrastructure, extending from pre-clinical science to
approval, and a team of 335 employees at its Berkeley location. For more
information, please visit http://www.xoma.com.
Certain
statements contained herein concerning anticipated reductions in operating
expenses and cash expenditures or that otherwise relate to future periods are
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These
statements are based on assumptions that may not prove accurate. Actual results
could differ materially from those anticipated due to certain risks inherent in
the biotechnology industry and for companies engaged in the development of new
products in a regulated market. Among other things, anticipated reductions in
operating expenses or cash expenditures from workforce reductions may be offset
by unanticipated expenditures relating to changes in XOMA's research and
development programs or other businesses. These and other risks, including those
related to the results of discovery and pre-clinical testing; the timing or
results of pending and future clinical trials (including the design and progress
of clinical trials; safety and efficacy of the products being tested; action,
inaction or delay by the FDA, European or other regulators or their advisory
bodies; and analysis or interpretation by, or submission to, these entities or
others of scientific data); changes in the status of existing collaborative
relationships; the ability of collaborators and other partners to meet their
obligations; XOMA's ability to meet the demands of the United States government
agency with which it has entered into its government contracts; competition;
market demands for products; scale-up and marketing capabilities; availability
of additional licensing or collaboration opportunities; international
operations; share price volatility; XOMA's financing needs and opportunities;
uncertainties regarding the status of biotechnology patents; uncertainties as to
the costs of protecting intellectual property; and risks associated with XOMA's
status as a Bermuda company, are described in more detail in XOMA's most recent
filing on Form 10-K and in other SEC filings. Consider such risks carefully when
considering XOMA's prospects.
Porter
Novelli Life Sciences for XOMA
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Media
& Investors Contact:
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Carolyn
Hawley
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619-849-5375
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chawley@pnlifesciences.com
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