Vical restructures, 39% staff reduction
Vical, which researches and develops biopharmaceutical products based on its patented DNA delivery technologies for the prevention and treatment of serious or life-threatening diseases, has announced a restructuring to conserve capital, including a staff reduction of 47 employees, approximately 39% of the company's total workforce. Following the restructuring, the company will have approximately 74 employees. In addition, the company is focusing its resources on its infectious disease vaccine programs and terminating activities related to Allovectin, the company's investigational cancer immunotherapy which recently failed to meet its phase III efficacy endpoints.
The company expects to incur personnel-related restructuring charges of approximately $2.2 million in the third quarter of 2013. The net cash burn of approximately $17 million for the first half of 2013 was slightly below the projected range of $18 million to $20 million. Vical had cash and investments of approximately $70 million at June 30. The company is projecting net cash burn for the second half of 2013, including anticipated cash severance payments in connection with the restructuring, of $13 million to $15 million.