Cellectar Biosciences has begun shutting down manufacturing operations at its headquarters and its plan going forward will be to have one of the company’s existing partners handle finished product manufacturing, Cellectar CEO Jim Caruso said Monday.
Madison, WI-based Cellectar (NASDAQ: CLRB) is developing drugs with the potential to treat malignant tumors and certain forms of blood cancer, including multiple myeloma.
Caruso said the company plans to lay off six of its 16 employees as a result of the decision to shut down its manufacturing activities. The shutdown process started earlier this month and is expected to be complete by the end of June, Cellectar said.
The Ontario, Canada-based Centre for Probe Development and Commercialization, which Cellectar first announced it was working with in late 2016, will now be responsible for finished product manufacturing of Cellectar’s therapeutics, Caruso said.
According to a document filed with federal securities regulators, the shutdown and subsequent layoffs are expected to cost Cellectar about $1.4 million. The majority of that total would come in the form of non-cash expenses, including write-downs of the company’s manufacturing plant and equipment, Cellectar said.
In an interview, Caruso said letting employees go is “always difficult.” However, in the long term, the changes to how Cellectar approaches manufacturing are expected to bring “very significant” cost savings, he said.
“It allows us to invest precious dollars and resources in our science,” Caruso said, adding that the decision to shut down local manufacturing operations was a result of it being “difficult to justify maintaining a pretty significant footprint and space” at Cellectar’s headquarters.
The announcement comes as Cellectar attempts to move its lead drug candidate, CLR 131, through mid-stage clinical trials. The company said last month that it plans to enroll up to 40 more patients in a Phase 2 clinical trial of CLR 131. Cellectar said it planned to enroll more multiple myeloma patients in the study because the data it had collected up to that point showed the drug “exceeded pre-specified criteria for clinically meaningful benefit.” Cellectar said at the time that it planned to share more data from the Phase 2 trial, as well as its Phase 1 study of CLR 131, in 2018.
The company’s pipeline of drug candidates also includes light-emitting chemical compounds, which Caruso has said could potentially be used in surgeries on breast cancer patients.
The technology that underpins Cellectar’s drug delivery platform is based in part on phospholipid ethers, which are designed to help kill tumors while minimizing the amount of healthy tissue destroyed in the process.
Shares in Cellectar closed the trading day at $1.26 apiece, about 3.8 percent lower than Friday’s closing price of $1.31 a share.