GenVec, a biopharmaceutical company based in Gaithersburg, Md., is lowering its operating costs to conserve capital including eliminating 23 positions, or approximately 30% of its workforce.
"While it is a difficult decision to eliminate positions in our talented and dedicated workforce, this move is necessary to ensure that our costs are more closely aligned with our resources and business strategy," said Cynthia Collins, president and CEO of GenVec. "Expenses are being reduced in virtually all areas, but we have focused on limiting the impact on our collaboration with Novartis to develop treatments for hearing loss and balance disorders. We continue to believe that this important program has the potential to be extremely valuable to our shareholders."
GenVec ended the second quarter of 2012 with approximately $20.9 million in cash, cash equivalents, and short term investments. Approximately $660,000 of expenses are expected to be incurred in the third quarter of 2012 due to the costs of reducing GenVec's workforce.
"In response to reduced revenue expectations for 2013, these cost reductions will allow us to fund our operations through the third quarter of 2014 exclusive of milestones we are eligible to receive under our collaboration with Novartis," said Douglas Swirsky, senior vice president and CFO of GenVec. "GenVec remains focused on advancing its technology and product opportunities through collaborations."