To Save Cash, Vical Cuts 29 Jobs and Closes Facility
San Diego vaccine developer Vical (NASDAQ: VICL has joined the roster of small biotechs that have been forced to cut costs to conserve cash.
The microcap biotech says it’s laying off 29 employees, or about 20 percent of its workforce, and closing an unidentified research facility sooner than planned. The company says it expects to reduce spending by about $4 million a year by making the cuts.
Vical says it will have about 120 employees after the reorganization. The company, which has about $40 million on hand, says the move is intended to reduce its burn rate and focus the company’s drug development efforts on its most advanced vaccine development programs.
Vical says those programs include its experimental treatment for metastatic melanoma, Allovectin-7, and its potential vaccine for cytomegalovirus, a herpes-type virus.
The restructuring is expected to cost Vical about $800,000 related to the layoffs in fourth quarter and $500,000 stemming from the facility closure in the first quarter of 2009. The company said it will provide additional details on the effects of its restructuring in February.
Our overview on San Diego layoffs is here.