Xcyte Therapies, a company that develops treatments to stimulate the body's immune system to fight against destructive diseases, is looking...
Xcyte Therapies, a company that develops treatments to stimulate the body’s immune system to fight against destructive diseases, is looking for a remedy to its own failing health.
The Seattle biotech company’s stock has been on a steady downward trek since it went public last year at $8, closing yesterday at 68 cents per share. Yesterday Xcyte announced it is looking at “strategic options” including a merger, licensing agreement or even a sale of the company. Board Chairman Christopher Henney said any transaction would likely be made within the next quarter.
Investment bank SG Cowen and Co. was recently retained to advise the company, said acting President and CEO Robert Kirkman.
The company, which had $39.5 million in cash and investments at the end of March, reported a net loss of $7.2 million in the first quarter of 2005. At that spending rate, the company has enough funding for about five quarters without new capital.
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Kirkman said he was not prepared to comment on any course of action for the company yet, adding that management would “look at all the options on the table.”
Xcyte also announced it had shifted Chief Executive Officer Ron Berenson into the position of research director, adding to the internal overhaul the company has experienced over the last four months.
The company went through two rounds of layoffs this year, first cutting 26 employees in March and then an additional 12 in May — including its chief operating officer.
What it does: Develops technologies to generate therapeutic immune responses to treat HIV
History: Completed IPO in March 2004 at $8 a share; recently changed course away from treating cancer with cell therapies to concentrate on HIV
Source: Company reports
Kirkman, previously the company’s chief business officer and vice president, will serve in Berenson’s place until the process of exploring new options is complete.
Henney said Kirkman had a good skill set for running the business aspect of the company, while Berenson was more interesting in continuing to develop the technology.
The company will continue to reduce operating expenses, and more layoffs aren’t out of the question, Kirkman said. The company currently has about 70 employees.
In May, Xcyte dropped the development of its immune-system therapy against leukemia and shifted all of its resources to HIV research. After the news its stock dropped 15 cents a share, closing at 70 cents, but company executives maintain refocusing its research was the best opportunity for Xcyte to succeed.
Yesterday, the company’s market capitalization was $13.3 million.
Christina Siderius: 206-515-5066 or email@example.com