Cost-cutting measures were a foregone conclusion after Procter & Gamble (NYSE:PG) gave Nastech Pharmaceutical (NASDAQ:NSTK) a bloody nose last week. Yesterday we got a glimpse of Nastech's plan to stop the bleeding.

With three drugs in phase 2 clinical trials, its new adage appears to be "get the drugs through phase 2, and then get them partnered up." That sounds like a good strategy considering the company had only $58 million in cash and short-term investments at the end of the third quarter. Fortunately data from all three compounds should be available next year.

First up will be results from its intranasal insulin study in the first quarter of next year. Even with decent data, Nastech might have trouble finding a partner to pay enough up front for the drug, given Pfizer's (NYSE:PFE) return of Nektar Therapeutics' (NASDAQ:NKTR) Exubera earlier this week.

In Q3, data from its phase 2 study of weight-loss-promoting intranasal PYY will be available. If the data looks good, this could be Nastech's best bet for funding.

Last up could be its osteoporosis drug that P&G dropped. The data from the first phase 2 trial was promising, but Nastech needs to decide whether it thinks the drug is commercially viable -- the answer to that was likely the reason P&G dropped the program. If it decides to continue, data could be available a year from now.

With two -- possibly three -- trials to run, Nastech needs to take some serious cost cutting measures. In addition to cutting its workforce by 30%, Nastech is reducing its burn rate by spinning off its pre-clinical RNA interference (RNAi) research into a separate company. That way it can get independent investments from institutional investors and venture capitalists with the hopes of eventually funding it through an IPO.

Even though it's pretty far behind Alnylam Pharmaceuticals (NASDAQ:ALNY), ISIS Pharmaceuticals (NASDAQ:ISIS), and Merck (NYSE:MRK) in the antisense RNA field, it appears to have enough intellectual property to get at least initial funding for the spinoff, which will reduce spending by $20 million next year.

Nastech hopes to end the year with enough cash to get through 2008. It'll get two and possibly three shots at funding during that time, but the clinical trial data will have to be exemplary to get a deal to restart its pipeline research. Otherwise, it'll just be a puppet for its big pharma partner until royalties start rolling in years from now.

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Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. Pfizer is a pick of the Inside Value newsletter. The Fool has a disclosure policy.