Five Prime Announces Restructuring
October 10 2019 - 4:01PM
Business Wire
Clinical Timelines Not Impacted and $20 Million
of Annualized Savings Expected
Five Prime Therapeutics, Inc. (NASDAQ: FPRX), a clinical-stage
biotechnology company focused on discovering and developing immune
modulators and precision therapies for solid tumor cancers,
announced today a corporate restructuring to extend the company’s
cash runway without impacting or delaying the data timelines of its
clinical programs. The company will retain a small research group
focused on advancing three wholly-owned, late-stage research assets
and will increasingly rely on outsourcing and contracted
capabilities.
“My immediate focus as CEO has been to conduct a review of Five
Prime’s operations with the goal of ensuring long-term
sustainability and value creation,” said William Ringo, Chairman
and Interim Chief Executive Officer of Five Prime Therapeutics.
“This restructuring provides the cash runway to prioritize future
pipeline investments based on clinical data readouts in 2020. It
also allows us to evaluate long-term strategies to grow our
pipeline. We acknowledge this decision impacts many talented
employees who helped build Five Prime into a clinical-stage
company. We are grateful for their contributions and hold them in
high regard.”
Corporate Restructuring
The company will eliminate approximately 70 positions across all
functions. Seventy percent of these positions will be eliminated by
the end of 2019, with the remainder occurring in 2020. The company
is also initiating activities to reduce its corporate facilities
footprint by either subletting a significant portion of its leased
space or subletting the entirety of its building and relocating to
smaller facilities. The company believes these actions will improve
its potential to bring value to patients, employees and
shareholders.
The company expects that the restructuring, planned facility
expense reduction and other cost-saving efforts will result in
approximately $20 million in annualized cost savings, extending the
company’s cash runway. Five Prime estimates that it will incur
approximately $3 million of pre-tax charges for severance and other
costs related to the restructuring, primarily in 2019.
The company is reaffirming its financial guidance and
anticipates ending 2019 with $148 to $153 million in cash, cash
equivalents and marketable securities.
About Five Prime
Five Prime Therapeutics, Inc. discovers and develops innovative
protein therapeutics to improve the lives of patients with serious
diseases. Five Prime’s product candidates have innovative
mechanisms of action and address patient populations in need of
better therapies. Five Prime has five programs in various stages of
clinical development, two of which are partnered with Bristol-Myers
Squibb. The company focuses on researching and developing
immuno-oncology and targeted cancer therapies paired with companion
diagnostics to identify patients who are most likely to benefit
from treatment with Five Prime’s product candidates. Five Prime has
entered into strategic collaborations with leading global
pharmaceutical companies and has promising product candidates in
clinical and preclinical development. For more information, please
visit www.fiveprime.com or follow us on LinkedIn, Twitter and
Facebook.
Cautionary Note on Forward-looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Words such as "may," "will," "expect," "plan," "anticipate,"
"estimate," "intend" and similar expressions (as well as other
words or expressions referencing future events, conditions or
circumstances) are intended to identify forward-looking statements.
These forward-looking statements are based on Five Prime's
expectations and assumptions as of the date of this press release.
Each of these forward-looking statements involves risks and
uncertainties. Forward-looking statements contained in this press
release include statements regarding (i) the effect the
restructuring will have on Five Prime’s expected cash runway; (ii)
the timing of the presentation of data for Five Prime’s product
candidates; (iii) the timing of progress and scope of clinical
trials for Five Prime’s product candidates; (iv) the scope and
timing of the restructuring; (v) plans to reduce Five Prime’s
corporate facilities footprint; (vi) the expected annual cost
savings associated with the restructuring, planned facility expense
reductions and the company’s other cost-saving efforts; (vii) the
timing and scope of expected pre-tax charges for severance and
other costs related to the restructuring; and (viii) the amount of
Five Prime’s cash, cash equivalents and marketable securities at
the end of 2019. Actual results may differ materially from these
forward-looking statements. Factors that may cause actual results
to differ from those expressed or implied in the forward-looking
statements in this press release are discussed in Five Prime’s
filings with the U.S. Securities and Exchange Commission, including
the “Risk Factors” contained therein. Except as required by law,
Five Prime assumes no obligation to update any forward-looking
statements contained herein to reflect any change in expectations,
even as new information becomes available.
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version on businesswire.com: https://www.businesswire.com/news/home/20191010005744/en/
Media and Investor Contact Martin Forrest, Vice
President, Investor Relations & Corporate Communications
martin.forrest@fiveprime.com 415-365-5625
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