San Diego-based biotech Vical Inc. will lay off 47 of its employees — about 39 percent of its workforce — after it ended development for its melanoma treatment, the company said.
Following the layoffs, Vical (Nasdaq: VICL) will have 74 employees.
Shares plunged 57 percent after the company announced earlier this month its melanoma treatment did not work — falling from $3.57 to $1.52. As of August 22, stock fell even further, closing day trading at $1.33 a share.
The company recently announced that a 390-patient trial found that the drug didn’t significantly reduce the size of melanoma tumors or increase the survival rate of patients compared to those undergoing chemotherapy — a huge blow for a drug that’s been in development for nearly 20 years.
The company reported cash and investments of $70 million on June 30, which it said is enough to meet its needs through the end of 2014.
It said it anticipates personnel-related restructuring charges of about $2.2 million in the third quarter of 2013. It projects a net cash burn for the second half of 2013 to be $13 million to $15 million.
— Meghana Keshavan