Other items: Seattle office tower sold for $52.4 million; Private placement raises $15 million for SCOLR Pharma; and others.

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Pacific Northwest


Air Force orders 3 customized 737s

Boeing has won a contract to provide three customized 737s to the Air Force. Based on the luxury Boeing Business Jet version of the 737-700, the aircraft will ferry teams of military and political VIPs around the world.

The Renton-built 737s will replace older jets based on the smaller McDonnell Douglas DC-9. The first airplane is to be delivered to Scott Air Force Base in Illinois in 2007.

The custom interior of the jets will be provided by Greenpoint Technologies of Kirkland.

Greenpoint, which has 63 employees, does the design, engineering, purchasing and program management, and oversees the interior installation at Boeing Wichita’s military-modification center.

Exchange Building

Office tower sold for $52.4 million

A Texas real-estate company has picked up a piece of Seattle history, but not without paying a hefty price.

Crescent Real Estate Equities bought the 22-story Exchange Building earlier this week for $52.4 million, property records show. That was nearly double the price Chicago’s Walton Street Capital paid for the Art Deco office tower in 1998.

Walton Street renovated the broad-shouldered, 1929 building at Second Avenue and Marion Street three years ago. The building is 15 percent vacant.

SCOLR Pharma

Private placement raises $15 million

SCOLR Pharma, a Bellevue company reformulating drugs so they can be taken less often, said yesterday it has raised $15 million through a private placement of stock.

The company said yesterday after markets closed that it sold 3.75 million shares of stock at $4 a share. Taglich Brothers served as the placement agent on the deal and received 75,000 warrants to buy shares at $5 over the next five years. SCOLR stock closed yesterday at $4.58, down 4 cents, on the American Stock Exchange.

Dan Wilds, chief executive of the company, said it plans to use the money to start clinical trials of a 12-hour formulation of the pain reliever ibuprofen. The company also is planning to test a 12-hour form of the nasal decongestant pseudoephedrine, known by the brand name Sudafed.

Cell Therapeutics

European patent obtained to sell drug

Cell Therapeutics said yesterday it has received a European patent that gives it the exclusive right to sell Xyotax in Europe until 2017. The patent extends for the same term as the existing Xyotax patents in the United States.

The company plans to release survival data from a large clinical trial of Xyotax in lung cancer by late next month or early April. The drug is designed to reduce the side effects of a common chemotherapy drug and enable patients to withstand more doses.


Vaccine approval will bring royalties

Corixa said yesterday that European regulators have approved Fendrix, a new hepatitis B vaccine that contains one of Corixa’s immune-system boosting compounds.

The vaccine, made by GlaxoSmithKline, is aimed at patients with kidney troubles who are more vulnerable to infections. Corixa is making the compounds, called adjuvants, at a factory in Hamilton, Mont.

Corixa will receive royalties on sales of Fendrix. It hasn’t disclosed the royalty rate, but analysts think it probably will be a single-digit percentage of Fendrix sales.

Nation / World


Aide to former CEO cooperated in probe

With federal investigators circling HealthSouth, a longtime aide to then-CEO Richard Scrushy decided to reveal years of fraud rather than commit perjury, according to testimony yesterday at Scrushy’s trial.

Bill Owens, who was primarily a finance executive but also briefly replaced Scrushy as CEO, said his cooperation included letting agents hide a small microphone in his tie so he could secretly record conversations with Scrushy.

Owens’ testimony set the stage for jurors to listen to the recordings. Prosecutors say they conclusively prove Scrushy’s involvement in the scheme at the medical rehabilitation giant, but the defense contends they prove Scrushy’s innocence.

Lockheed Martin

Employees warned of possible layoffs

Top U.S. defense contractor Lockheed Martin said it could be forced to begin laying off workers at its Marietta, Ga., plant and elsewhere if Congress approves the fiscal 2006 budget proposed by President Bush.

The budget maps out plans to end production of Lockheed’s F/A-22, meant to replace the F-15 as the top U.S. air-to-air fighter, after 2009, and would cut the company’s C-130J cargo plane from 2006.

“If this budget goes as proposed, we could be looking at some layoffs pretty soon,” Lockheed spokesman Sam Grizzle said.

The cuts, totaling $10.5 billion and $4.9 billion, respectively, could have serious consequences for Lockheed’s Marietta plant, which employs 8,000 people, Grizzle said, although he cautioned that the budget process was just beginning.


Map service aims to challenge rivals

Google, the most-used Web search engine, yesterday released a test version of a feature offering maps to users, offering a challenge to similar services from Yahoo! and Microsoft.

Google’s map service offers driving directions and the ability to search for local businesses and zoom in on those areas. Google is adding new capabilities, including e-mail and searches for video clips, as it competes with Yahoo! and Microsoft’s MSN search engine.

Google spokesman Steve Langdon didn’t immediately return a call seeking comment. The map function can be accessed at www.google.com/maps.

Shares of Google rose $2.61 to $198.64 yesterday. The stock has more than doubled since its August debut at $85.

Krispy Kreme

125 workers laid off as cost-cutting begins

Krispy Kreme’s turnaround efforts began in earnest yesterday with the layoff of about 125 workers, or 25 percent of the work force, at its Winston-Salem, N.C., corporate headquarters and other key facilities.

The struggling doughnut chain also said it was getting rid of its corporate jet to conserve cash.


Lockheed choice won’t be protested

United Technologies’ Sikorsky Aircraft unit yesterday said it would not protest the U.S. Navy’s choice of a Lockheed Martin-led team to build a new fleet of presidential helicopters since a separate investigation was already under way.

Lawmakers had urged Sikorsky to protest the contract award, arguing that it was unfair of the Navy to give the contract to Lockheed and its partner, AgustaWestland, a unit of Italy’s Finmeccanica, which plans to do about one-third of the manufacturing work in Europe.

Sikorsky said it opted not to protest the award, valued at $6.1 billion, in part because the Government Accountability Office was already investigating possible problems with doing heightened security work in an offshore foreign environment.

Compiled from Seattle Times business staff, Reuters, Bloomberg News and The Associated Press