Drug developer Pharmaxis to slash 45 jobs

AAP

Drug developer Pharmaxis will slash 45 jobs and cut costs as the company undertakes a major restructure after encountering regulatory problems.

Pharmaxis chief executive Gary Phillips says all areas of the business have been reviewed and the company aims to mitigate risks associated with drug development after failing to achieve regulatory milestones.

"These decisions have been made in response to recent regulatory and clinical trial setbacks," Mr Phillips said in a statement.

Pharmaxis expects to reduce staff numbers by 30 per cent from 155 to 110 people.

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The company also expects to reduce costs by $12 million per year, with around three quarters of the reductions occurring by the end of the third quarter of the 2013 calendar year.

Pharmaxis says it will seek "partnership opportunities" for Bronchitol in the US for cystic fibrosis and globally for bronchiectasis while retaining a direct commercial interest in Bronchitol in Europe and other approved and reimbursed markets.

Bronchitol is an inhaled dry powder designed to hydrate the lung and restore normal lung clearance mechanisms.

Bronchiectasis is a condition in which damage to the airways causes them to dilate, lose their tone and become scarred.

The airways consequently lose their ability to clear mucus, leading to the growth of bacteria and serious lung infections.

Eventually, this can lead to respiratory failure.

At the end of April Pharmaxis had $70.5 million in cash and a further $US20 million available under a financing agreement upon commencement of a US cystic fibrosis clinical trial.

Chairman Malcolm McComas said the reshaping of Pharmaxis could be funded out of existing cash resources.

"Some hard decisions have been made," he said.

He said the company had made 2013 a year of restructure in direct response to its failure to achieve regulatory milestones.

At 1200 Pharmaxis shares were 1.5 cents, or 6.5 per cent, lower at 21.5 cents.

? 2013 AAP
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