Idenix Pharmaceuticals (IDIX): This is the restructuring move we’...

Reply Private New

Replies (4) Next 10 Prev Next

Send PM Follow Ignore

Followers	839
Posts	120650
Boards Moderated	13
Alias Born	09/05/2002

DewDiligence

Re: silly beaver post# 1942

Friday, 09/28/2007 9:15:07 AM

Friday, September 28, 2007 9:15:07 AM

This is the restructuring move we’ve been talking
about on this board for the past several weeks. Cash
burn will be reduced by $40-45M annually in 2008
and beyond to a new level of $40-60M. However, the
PR doesn’t say what the new royalty rate on Tyzeka
sales will be. Without knowing that, the agreement is
hard to evaluate.

http://biz.yahoo.com/prnews/070928/nef023.html?.v=21

>>
Idenix Pharmaceuticals Restructures to Concentrate Efforts on HCV and HIV Programs

Friday September 28, 9:00 am ET

CAMBRIDGE, Mass., Sept. 28 /PRNewswire-FirstCall/ -- Idenix Pharmaceuticals, Inc. (Nasdaq: IDIX ), a biopharmaceutical company engaged in the discovery and development of drugs for the treatment of human viral diseases, today announced a strategic restructuring. As part of the restructuring, Idenix has amended the collaboration agreement with Novartis Pharma AG related to Tyzeka®/Sebivo®. Per the amended agreement, Idenix will discontinue all development, manufacturing and commercial activities for Tyzeka/Sebivo. Novartis will continue these activities and have full responsibility for ongoing and future clinical trials and regulatory filings related to Tyzeka/Sebivo. Additionally, Idenix will receive a royalty on worldwide product sales. As a result of these changes, Idenix is reducing its workforce by approximately 100 positions, the majority of which support the development and commercialization of Tyzeka/Sebivo in the United States and Europe. Following this reduction, Idenix will have approximately 200 employees at the company. The company anticipates that this action will reduce its cash burn rate by between 40 percent and 50 percent.

"This has been a challenging time in the evolution of our company and we have re-evaluated our strategic plan and our organizational structure," said Jean-Pierre Sommadossi, Ph.D., chairman and chief executive officer of Idenix. "We made a strategic decision to focus all of our resources on our hepatitis C and HIV/AIDS discovery and development programs; as such, we have discontinued the development of valtorcitabine for the treatment of hepatitis B and have changed our agreement for Tyzeka/Sebivo to a royalty stream arrangement. These decisions will enable us to concentrate on what we believe is most critical to our future success -- building and advancing our pipeline."

Idenix currently has a non-nucleoside reverse transcriptase inhibitor (NNRTI), IDX899, for the treatment of HIV-1 that is being evaluated in phase I/II clinical testing. The company also has a comprehensive HCV discovery effort, comprised of a next-generation nucleoside polymerase inhibitor program, including IDX102 and IDX184, which are currently being evaluated in advanced preclinical testing, and HCV non-nucleoside polymerase inhibitor and HCV protease inhibitor programs.

As a result of this restructuring, Idenix will incur between $5 million and $10 million in charges, primarily associated with one-time employee severance benefits and the write-off of certain assets. The company continues to expect to end 2007 with between $100 million and $110 million of cash, cash equivalents and marketable securities. Idenix estimates that this restructuring will result in savings of $40 million to $45 million on an annual basis.

"We have taken the steps necessary to streamline our organization and significantly reduce our expenses, while continuing to maintain the strength of our balance sheet," said Ronald Renaud, Jr., chief financial officer of Idenix. "We believe that we are now well-positioned to fund the advancement of our HIV and HCV discovery and development programs through 2009."

About Idenix/Novartis Collaboration

Idenix and Novartis Pharma AG established a collaboration in May 2003, at which point Novartis became a majority shareholder in Idenix. Currently, Novartis owns 56% of Idenix and has first right of refusal to Idenix's pipeline.

About Idenix

Idenix Pharmaceuticals, Inc., headquartered in Cambridge, Massachusetts, is a biopharmaceutical company engaged in the discovery and development of drugs for the treatment of human viral and other infectious diseases. Idenix's current focus is on the treatment of infections caused by hepatitis C virus and HIV. For further information about Idenix, please refer to http://www.idenix.com.
<<

“The efficient-market hypothesis may be
the foremost piece of B.S. ever promulgated
in any area of human knowledge!”