Aveo Cuts Staff, Announces 3rd Quarter Loss
AVEO Oncology (NASDAQ: AVEO), based in Cambridge, MA, said it is cutting 45 jobs—17 percent of its workforce—and eliminating another 30 open positions in an effort to save money while it waits for FDA approval of its tivozanib, its experimental treatment for kidney cancer submitted for approval in September.
The company announced the staff reductions on Tuesday, at the same time as it reported a loss of $30.1 million for the third quarter, compared with a loss of $23.8 million a year earlier. Revenues from collaborations for the third quarter dropped to $1.0 million from with $3.6 million in the 2011 period. Aveo said the layoffs are part of a restructuring that it expects will save $37 million next year and a total of $100 million over the next three years. After the restructuring, AVEO will have about 225 employees.
Aveo got some worrisome news from the FDA in August about tivozanib , which it is developing with Japan’s Astellas: the agency expressed concern about the results of a clinical trial that found the drug may not extend lives as well as sorafenib (Nexavar), a kidney drug already on the market. The company said then it would be able to address the FDA’s concerns in its drug approval filing, but as my colleague Luke Timmerman reported, the trial results raised significant questions for Aveo about tivozanib. If the drug does not extend lives, wrote Luke, it could nullify the drug’s ability to shrink the size of the tumors.