Full Press Release Details
Genetics Realigns Product Development Priorities
Implements Cost Reduction Measures
Company Focuses on Clinical Development Path for LCA, HD and ALS -
Cuts Costs by Personnel Reductions and Salary Deferrals and Reductions -
Wash., December 2, 2008-
Targeted Genetics Corporation (NASDAQ:TGEN) today announced that it has
realigned its product development priorities to focus on its ocular and
neurological product candidates and its first use of expressed RNAi. The Company
believes these candidates present the greatest opportunity for creating value
the near term with the capabilities and resources currently available to the
Company and its collaborators and with the financial resources it believes
available in today's challenging capital markets. In conjunction with this
pipeline prioritization, the Company has reduced its payroll costs by 25% and
reduced other costs by 15% when compared to 2008.
believe this prioritization of our product pipeline and the resulting changes
our cost structure positions us to advance our promising candidates while we
explore ways to monetize other valuable assets that the Company has built over
the years," said B.G. Susan Robinson, president and chief executive officer of
Company plans to focus its efforts around its clinical stage AAV-RPE65 product
candidate for treatment of severe retinal dystrophies most commonly diagnosed
Leber's Congenital Amaurosis (LCA), its preclinical Huntington's Disease (HD)
product candidate and a third product candidate to treat Amyotrophic Lateral
Sclerosis (ALS), also in preclinical development.
Genetics' LCA program was initiated in 2005 when the Company entered into a
collaboration agreement to develop, manufacture and commercialize AAV-RPE65
the University College London and Moorfield's Hospital. Targeted Genetics
manufactured AAV-RPE65 vector for the ongoing Phase I/II clinical trial
initiated in May 2007. In April 2008, Professor Robin Ali, University College
London and Moorfield's Hospital, reported promising early results at the
Association for Research in Vision and Ophthalmology (ARVO) conference, which
findings were published in the May 2008 issue of the New England Journal of
Medicine. Based on the success seen in this trial with one of the patients
the possible short time to market for a potential drug of this type, the Company
plans to pursue commercialization of the AAV-RPE65 product candidate and be
position as early as 2010 to file regulatory documents seeking marketing
approval for the candidate. If the LCA program is successful, the Company
intends to leverage work on the AAV-RPE65 product and pursue treatment of
additional ocular diseases.
Genetics' HD program, conducted in collaboration with Beverly Davidson, Ph.D.,
the Roy J. Carver Professor of Medicine and Vice Chair of Basic Research in
Department of Internal Medicine at the University of Iowa, is the Company's
prototype program to utilize the potential of AAV as a delivery mechanism for
expressed RNAi, a potent gene silencing technology. The Company views its
expressed RNAi program for HD as both a promising initial product opportunity
address neurological disorders and a proof-of-concept for delivering expressed
interfering RNA constructs utilizing an AAV vector.
Genetics is conducting its ALS program with John
Engelhardt, Ph.D., Director of the Center for Gene Therapy and Professor,
Department of Anatomy and Cell Biology at the University of Iowa. The program
fully funded for 2009 as a result of a $2.4 million grant from the United States
Department of Defense. Targeted Genetics plans to develop a small-molecule
product candidate based on observations by Dr. Engelhardt which show that
over-activation of NADPH (nicotinamide adenine dinucleotide phosphate) oxidase
is associated with pathogenesis of ALS. The work expected to be performed under
the grant includes formulation development and preclinical testing. Although
within the Company's general focus on gene therapy, the Company believes the
ability to leverage a long-standing collaboration and a two-year NADPH sponsored
research agreement with Dr. Engelhardt and its experience with bringing
therapeutics to trial presents a compelling opportunity to expand the Company's
platform. If preclinical results generated in 2009 are promising, the Company
expects to initiate clinical trials of an ALS drug candidate as early as
Company is also evaluating alternatives for the future clinical development
its inflammatory arthritis product candidate, tgAAC94. The Company continues
see value in the inflammatory arthritis program. It believes, however, that
most prudent and efficient way to advance this program will be through
collaboration with a corporate partner that has the resources to take the
product into phase II development and, if successful, onto commercialization.
the near term, the Company plans to continue its collaborations with the
National Institutes of Health and Children's Hospital of Philadelphia to support
the initiation of clinical trials by its collaborators of an HIV-vaccine product
addition, the Company plans to maintain its manufacturing collaboration with
Celladon Corporation in support of their clinical study in congestive heart
failure. Finally, the Company plans to continue to explore
opportunities to monetize its other assets, including ways to capitalize on
industry pioneering work and strength as a leader in the development of
commercially scalable AAV manufacturing processes.
Company's cost cutting measures included a reduction of seven employees and
salary deferrals or reductions to half-time status for the seven most senior
Company executives. These changes, along with the previously announced
resignations of the Company's former chief executive officer and chief
scientific officer, collectively reduce the Company's current cash outflow for
employee compensation by approximately 25%. As a result of these staffing
changes, the Company currently employs 56 full-time equivalent
reported in the Company's Form 10Q filed November 5, 2008, the Company only has
cash and short term investments to support its ongoing activities into the
quarter of 2009. As a result, the Company is aggressively pursuing access to
additional capital from a wide variety of potential sources, including strategic
transactions, licensing or selling technology, additional product development
collaborations, sales of stock or placement of debt, additional revenue from
expanding or augmenting current collaborations and initiatives to capitalize
the Company's intellectual property, manufacturing capabilities and product
development expertise.
Targeted Genetics Corporation
Genetics Corporation is a biotechnology company committed to the development
innovative therapies for the prevention and treatment of diseases with
significant unmet medical need. A key area of focus for Targeted Genetics is
applying its proprietary Adeno-Associated Virus (AAV) technology platform to
deliver genetic constructs to increase gene function or silence gene function.
Targeted Genetics' lead product development efforts target ocular and
neurological indications, two therapeutic areas where AAV delivery may have