OncoGenex Pharmaceuticals, created by merging Bothell-based Sonus Pharmaceuticals and OncoGenex Technologies of Vancouver, B.C., said Thursday it would lay off half its combined workforce, mostly from Sonus.
The biotech company formerly known as Sonus Pharmaceuticals said Thursday it would lay off half its workforce amid efforts to refocus itself and conserve cash.
The firm, now known as OncoGenex Pharmaceuticals, is the result of the merger between Sonus and OncoGenex Technologies of Vancouver B.C., approved by Sonus shareholders Tuesday and effective Thursday.
The company will have 25 full-time employees and 2 part-timers, after laying off 24 others. Sonus’ workforce in Bothell will suffer the majority of the cuts — 19 in total, mostly people performing laboratory, administrative and financial functions.
Chief Executive Scott Cormack said the company needed to implement the cuts quickly to strengthen its clinical programs and conserve its $26 million in cash. The money, expected to last until late 2009, is enough to fund all the ongoing company’s trials, he said.
Most Read Business Stories
- REI picks new satellite office ‘surrounded by trail networks’
- Judge upholds Seattle eviction regulations, rebuffing landlords' lawsuit
- Fry's Electronics executive accused of embezzling $65 million
- Funky electronics chain Fry's is no more
- Alaska Airlines ordered to pay $3.2M to family of woman who died after escalator fall
The combined company will have 13 employees in Vancouver, seven in Bothell and seven in Seattle, where OncoGenex Technologies had a research facility. All Washington employees soon will be housed in the Bothell facilities inherited from Sonus, which will serve as corporate headquarters, Cormack said.
The decision to cut jobs was announced two days after Sonus shareholders approved the merger. A delay in the restructuring would have made the company “burn out our cash without any benefit and put everybody in turmoil,” Cormack said.
Sonus CEO Michael Martino and Chief Financial Officer Alan Fuhrman stepped down and are entitled to severance payments of $1.1 million and $256,000, respectively. Martino will sit on OncoGenex Pharmaceuticals’ board. OncoGenex Technologies’ CFO Stephen Anderson will replace Fuhrman.
The merger is the culmination of a difficult period for Sonus Pharmaceuticals. Last fall, its main therapy for breast cancer failed in clinical trials. After its stock plummeted, the company halted most of its research and laid off many workers. The Nasdaq market put the company’s listing on probation after shares fell under the $1 bar.
But the company still had some cash to match with OncoGenex Technologies’ pipeline of research products, which was more advanced than its own. Along with the merger, the company carried out a reverse stock split.
OncoGenex Pharmaceuticals’ shares began trading in Nasdaq on Thursday under the symbol OGXI. The stock closed Thursday at $4.82 per share, according to the company’s web site.
Ángel González: 206-515-5644 or firstname.lastname@example.org