PropThink: Expense Cuts Ahead of a Pivotal Year for AVEO and Tivozanib
(Thomson Reuters ONE) -
By Jake King
In a move that management says will save the company more than $100M over the
next three years, AVEO Oncology (NASDAQ:AVEO) cut its work force by 17% and made
strategic shifts to lighten the R&D expenses of early-stage compounds.
Management is trying to be as candid as possible going into 2013 as investor
confidence waned this year and stock price dipped lower and lower, in fact
setting a new 52-week low just this month. The expense cuts and visibility
couldn't be more pertinent as AVEO prepares for the commercial launch of
tivozanib, a potential first-line treatment for Renal Cell Carcinoma (RCC). If
approved, the drug will launch late next year.
The company finished the quarter with $189M in cash, equivalents, and short-term
investments and expects to end 2012 with roughly $135M, which, says management,
should last through next year. Management estimates, however, hinge on
tivozanib's approval, which will result in a substantial milestone payment from
partner Astellas Pharma (OTC:ALPMY) and may allow recognition of some tivozanib
revenue in the 4th quarter. That cash will be crucial in 2013 as the company
moves from a developmental entity into commercialization. The company is already
ramping up marketing efforts in advance of approval, bringing on industry
veteran Brad Bailey as VP of Sales and creating an 80-member salesforce for the
drug, for which Astellas will split expenses.Continue reading.
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Datum: 30.10.2012 - 18:02 Uhr
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News-ID 197761
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