Array BioPharma Loses Licensing Agreement, Cuts Staff

Array BioPharma (NASDAQ: ARRY  ) made a companywide 20% reduction in staff on Monday, the company announced yesterday, bringing the number of Array's employees to approximately 200.

The company made those cuts on the same day that Amgen (NASDAQ: AMGN  ) notified Array it had elected to end a collaboration and license agreement the companies entered into in December 2009.

That agreement called for Amgen to have the exclusive worldwide rights to develop and sell drugs to treat type 2 diabetes based on Array's small-molecule glucokinase activator (GKA) program. The most-advanced drug the companies were developing is called ARRY-403, or AMG-151. It is designed to help the body produce more insulin . Array said Amgen recently finished a mid-stage trial and it will share results from that study soon. The termination of the agreement will become effective Oct. 15 when all licenses and rights for the GKA program, including AMG 151, will revert back to Array.

Array was given $68.5 million by Amgen in initial and milestone payments but their deal could have had Array reaping an additional $658 million in further milestone payments.

Array said its reduction in staff will give it a one-time restructuring charge of $2.7 million in the first quarter of 2014, one that may increase later that year. Those charges will result from severance payments and outplacement assistance. The company also reported its fiscal-fourth-quarter results on Wednesday. Array said it lost $17.6 million, or $0.15 per share.

In July, Array entered into two new drug licensing agreements, one with Loxo Oncology, and the other with Celgene.

-- Material from The Associated Press was used in this report.

link


Read/Post Comments (0) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2586865, ~/Articles/ArticleHandler.aspx, 12/18/2014 3:34:19 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement