SOUTH SAN FRANCISCO, Calif., June 7 /PRNewswire-FirstCall/ -- Cell
Genesys, Inc. (Nasdaq: CEGE) today announced that it is implementing a
strategic restructuring of its business operations to focus resources on its
most advanced and most promising product development programs. Based on
additional encouraging data reported at the American Society of Clinical
Oncology (ASCO) Annual Meeting last month, Cell Genesys intends to deploy the
majority of its resources going forward to advance GVAX(R) vaccine for
prostate cancer currently in Phase 3 development, as well as GVAX(R) vaccine
for leukemia and GVAX(R) vaccine for pancreatic cancer, both of which are in
Phase 2 development. In the oncolytic virus therapy program, the priority
will be CG0070, which recently entered clinical trials for recurrent bladder
cancer and which could be evaluated in multiple types of cancer in the future.
Cell Genesys will be discontinuing all other clinical programs as soon as
feasible. As a result of these and other related portfolio decisions, the
company plans to sell its San Diego manufacturing facility for viral products
and will reduce its operations in Memphis from manufacturing to product
distribution. In addition, the company will eliminate approximately 95
positions and expects to end the year with approximately 285 employees. These
personnel and operating site decisions are expected to reduce the company's
current annualized operating expenses by approximately 15%, excluding one-time
personnel-related restructuring costs estimated at $1.9 million. Cell Genesys
ended the first quarter of 2005 with approximately $190 million in financial
assets including approximately $145 million in cash and 6.6 million shares of
its former subsidiary Abgenix, Inc.
The discontinued GVAX(R) vaccine programs include GVAX(R) vaccine for lung
cancer and GVAX(R) vaccine for myeloma. Both of these vaccine product
candidates are patient-specific vaccines and are otherwise targeting
malignancies for which several promising therapies have recently been
developed. While promising clinical trial results have been reported for both
of these programs, the company believes that such patient-specific vaccine
products will face a more challenging development and commercialization path
than the company's non-patient specific vaccine products for prostate cancer,
leukemia, and pancreatic cancer and should therefore not continue to compete
for resources. Moreover, as a result of the decision to phase out further
clinical development of GVAX(R) vaccine for lung cancer, the company will
discontinue manufacturing activities at its Memphis site. In the oncolytic
virus therapy program, the company will discontinue further clinical
development of CG7870 for prostate cancer due to other competing therapies and
will focus as noted above, on CG0070, which has the potential to target
multiple types of cancer and is "armed" with the GM-CSF gene that can
potentially induce beneficial systemic anti-tumor immunity. Cell Genesys will
also significantly reduce its early-stage research programs for the
development of new oncolytic virus therapies as well as its research effort in
anti-angiogenesis gene therapy for cancer, given the lengthy project
timelines. These latter portfolio decisions will reduce the company's
manufacturing needs in the viral product area and have resulted in the
decision by the company to sell its San Diego manufacturing site.
"At Cell Genesys, we have a long history of actively managing our product
portfolio to ensure that resources are applied towards the most promising
programs. As with similar decisions in the past, we are implementing this
restructuring from a position of financial strength and at a time when
encouraging progress in our clinical trials gives us the opportunity to
optimize portfolio management. While the decisions made and actions taken are
difficult, we are now better positioned than ever to pursue our principal
strategic goal of developing and commercializing biological therapies for
cancer," stated Stephen A. Sherwin, M.D., chairman and chief executive officer
of Cell Genesys. "We deeply appreciate the hard work and dedication of
employees who are affected by this restructuring and will do our best to ease
their employment transitions."
New and encouraging clinical data from the company's lead product
development program was the principal driver for the timing of this strategic
restructuring. At the ASCO Annual Meeting held last month, Cell Genesys
reported additional promising results from a second Phase 2 trial of GVAX(R)
vaccine for prostate cancer in patients with metastatic hormone refractory
prostate cancer (metastatic HRPC). The results for the 22 patients who
received the highest dose -- the dosing regimen comparable to that being
employed in the company's ongoing Phase 3 trial -- indicate that the median
survival has not been reached and the final median survival will be no less
than 24.1 months based on the current median follow-up time for these
patients. Previously reported findings from the company's first Phase 2 trial
of GVAX(R) vaccine for prostate cancer indicated an overall median survival of
26.2 months. The median survival results from both Phase 2 trials compare
favorably to the recently reported median survival of 18.9 months for
hormone-refractory metastatic prostate cancer patients treated with
Taxotere(R) plus prednisone, the current standard of care. The company's
ongoing Phase 3 clinical trial in asymptomatic metastatic HRPC is a
randomized, controlled comparison of GVAX(R) vaccine for prostate cancer to
Taxotere(R) plus prednisone with respect to survival benefit and is being
conducted under a Special Protocol Assessment (SPA) from the U.S. Food and
Drug Administration (FDA). The company recently announced that it has also
received an SPA for its second Phase 3 clinical trial of GVAX(R) vaccine for
prostate cancer in symptomatic metastatic HRPC patients, which is expected to
begin in the near future.
Cell Genesys is focused on the development and commercialization of novel
biological therapies for patients with cancer. The company is currently
pursuing two clinical stage product platforms -- GVAX(R) cancer vaccines and
oncolytic virus therapies. Ongoing clinical trials include a Phase 3 trial of
GVAX(R) vaccine for prostate cancer, Phase 2 trials of GVAX(R) vaccines for
leukemia and pancreatic cancer, and a Phase 1 trial of CG0070 oncolytic virus
therapy for bladder cancer and potentially other types of cancer. Cell
Genesys continues to hold equity interests in its two former subsidiaries
-- Abgenix, Inc., an antibody products company and Ceregene, Inc., which is
developing gene therapies for neurodegenerative disorders. Cell Genesys is
headquartered in South San Francisco, CA and has its principal manufacturing
operation in Hayward, CA. For additional information, please visit the
company's website at http://www.cellgenesys.com.
Cell Genesys will host a conference call to discuss this announcement
today, June 7, 2005 at 11:30 a.m. Eastern Time (8:30 a.m. Pacific Time).
Investors may listen to the webcast of the conference call live on Cell
Genesys' website. A replay of the webcast will be available for at least
48 hours following the call. Alternatively, investors may listen to a replay
of the call by dialing 800-475-6701 from locations in the U.S. and
320-365-3844 from outside the U.S. The call-in replay will be available for
48 hours following the call. Please refer to access number 783814.
Statements made herein about the company and its subsidiaries, other than
statements of historical fact, including statements about the company's
progress and financial forecasts, the costs and benefits of the restructuring,
the impact of the restructuring upon the financial statements, results and
timing of clinical trials and preclinical programs, agreements with the FDA
and the nature of product pipelines are forward-looking statements and are
subject to a number of uncertainties that could cause actual results to differ
materially from the statements made, including risks associated with making
financial forecasts and estimates, the company's ability to dispose of its
facility, the success of clinical trials and research and development
programs, the regulatory approval process for clinical trials, potential
changes in study protocols, new concerns of safety not previously known,
regulatory agreements for manufacturing controls and product testing
requirements, competitive technologies and products, patents, continuation of
corporate partnerships and the need for additional financings. For information
about these and other risks which may affect Cell Genesys, please see the
company's Annual Report on Form 10-K for the year ended December 31, 2004
dated March 14, 2005, as well as Cell Genesys' reports on Form 10-Q and 8-K
and other reports filed from time to time with the Securities and Exchange
Commission. The company assumes no obligation to update the forward-looking
information in this press release.
Contact: Ina Cu
Investor Relations
650-266-3200
SOURCE Cell Genesys, Inc.
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Related links:
http://www.cellgenesys.com
CONTACT:
investors, Ina Cu of Cell Genesys, Inc.,
+1-650-266-3200
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