Biotech firm Cell Genesys Inc. said it's laying off 290 people, or 75% of staff, and possibly seeking a buyer. That's a big blow to the Bay Area biotech work force and probably the end of a company that had pushed its prostate cancer vaccine, GVAX, into the final stages of testing. But the firm decided to cut short the second of two trials because the drug wasn't helping patients survive. The drug was meant to work by stimulating the body's immune system to attack the cancer.
Continue reading below
In addition to the nearly 300 workers to be laid off this year -- with more to come in 2009, Cell Genesys said -- another loser was Japan's biggest drug company, Takeda Pharmaceutical Co. Ltd., which gave Cell Genesys $50 million in April to help with the Phase 3 trials and grab worldwide marketing rights to GVAX. Through June 30 Takeda had also paid $11 million toward the Phase 3 GVAX trials, according to regulatory filings.
Betting on Phase 3 drugs is usually much less risky than earlier-stage investments, but not this time for Takeda, which has spent more than $10 billion this year on license and acquisitions.
For GVAX, the writing's been on the wall since late August, when the first of the trials was suspended.
Cell Genesys said it should have $128 million in cash at year's end.
- Alex Lash
