DGAP-News: Cytos Biotechnology Ltd announces strategic and organizational changes with the aim of preserving value around its lead product and to address the up-coming maturity of the Convertible Bond
(firmenpresse) - EquityStory AG-News: Cytos Biotechnology AG / Key word(s): Strategic
Company Decision
Cytos Biotechnology Ltd announces strategic and organizational changes
with the aim of preserving value around its lead product and to
address the up-coming maturity of the Convertible Bond
17.08.2011 / 07:00
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Cytos Biotechnology Ltd's Board of Directors has unanimously approved the
full implementation of measures to significantly reduce costs, to address
the up-coming maturity of the Convertible Bond due in February 2012 and to
focus on its key asset CYT003-QbG10.
To this end, the Board of Directors has approved a comprehensive set of
measures reducing all activities not related to CYT003-QbG10. Key elements
of the action plan include:
- putting all research and product development programs other than
CYT003-QbG10 on hold and, subject to the outcome of the consultation
with the workforce, to reduce the workforce as quickly as possible from
82 to around 10 employees
- adjust the size of the Board of Directors and the Executive Board to
the needs of a smaller company.
Also, Dr. Wolfgang Renner has resigned as CEO and member of the Board of
Directors but will continue to provide his expertise. Dr. Thomas Hecht,
Chairman of the Board, will act as executive chairman.
The above measures will reduce the burn rate over the coming months. Taking
into consideration the outstanding Convertible Bond of nominal CHF 41.1
million which is due on February 20, 2012, the financing gap could be still
as high as CHF 17 million by then.
Schlieren (Zurich), Switzerland, August 17, 2011 - Cytos Biotechnology Ltd
(SIX:'CYTN'; the 'Company') today announced strategic and organizational
changes with the aim of preserving value around its unlicensed lead
candidate CYT003-QbG10, which has been shown in three phase II studies to
be safe and efficacious for the treatment of allergic asthma and allergic
rhinitis.
Following a review of its strategic options and the outcome of negotiations
to date, the Board of Directors has come to the conclusion that in the
current difficult financing environment, research and development programs
which are at an earlier stage can for the time being no longer be
adequately funded and shall therefore be put on hold. As a result of this
decision, Cytos Biotechnology Ltd plans to reduce its work force by more
than 80% and will enter into consultation with its employees. The size of
the Executive Board and the Board of Directors will be adjusted to the
needs of a smaller company.
The partnered programs with Novartis and Pfizer and payments related to
these programs are not affected by this decision. The aim of the new
strategy is to maximize the value of CYT003-QbG10 and to pursue all
possible options.
Concurrently, the Company is also evaluating options on how to avoid a
default on the Convertible Bond due by February 20, 2012 (the 'Convertible
Bond') including but not limited to a Convertible Bond restructuring. The
approximate financing gap by February 20, 2012 could be as high as CHF 17
million.
The primary goal of the corporate and the Convertible Bond restructuring is
geared towards keeping the Company as going concern. However, the
substantial efforts undertaken by the Company in the last months have shown
that refinancing the Company to assure the solvency until revenues reach a
level to sustain positive cash flows is, in particular in the currently
difficult financing environment for small Biotech companies, a very
challenging task.
The Board of Directors has accepted Dr. Wolfgang Renner's resignation as
member of the Board of Directors and CEO and unanimously appointed Dr.
Thomas Hecht, Chairman of the Board of Directors, as executive chairman.
Dr. Thomas Hecht, Chairman of the Board of Directors of Cytos Biotechnology
Ltd commented: 'It was a very difficult decision for us to put research
programs on hold and to lay off most of our colleagues who have contributed
so greatly in the past to our Company. I would like to thank the team of
Cytos Biotechnology and Wolfgang for their strong commitment and
contributions.
However, in the current capital market environment and in the light of the
pending repayment of the Convertible Bond it is impossible for a small
biotech company without sustainable product revenues to continue developing
new innovative medicines, in spite of pressing unmet medical needs.'
For further information please contact:
Cytos Biotechnology Ltd
Harry Welten, MBA
Chief Financial Officer
Tel.: +41 44 733 46 46
e-Mail: harry.welten(at)cytos.com
Website: www.cytos.com
About Cytos Biotechnology
Cytos Biotechnology Ltd is a Swiss public biotechnology company that
specializes in the discovery, development and commercialization of a new
class of biopharmaceutical products - the Immunodrugs(TM). Immunodrugs(TM)
are intended for use in the treatment and prevention of common chronic
diseases, which afflict millions of people worldwide. Immunodrugs(TM) are
designed to instruct the patient's immune system to produce desired
therapeutic antibody or T cell responses that modulate chronic disease
processes. Taking advantage of the high flexibility of its Immunodrug(TM)
platform, Cytos Biotechnology has built a diversified pipeline of
Immunodrug(TM) candidates in various disease areas, of which five are
currently in clinical development. The Immunodrug(TM) candidates are
developed both in-house and together with Novartis, Pfizer and Pfizer
Animal Health. Founded in 1995 as a spinoff from the Swiss Federal
Institute of Technology (ETH) in Zurich, the Company is located in
Schlieren (Zurich). Currently, the Company has 82 employees. Cytos
Biotechnology Ltd is listed on the main segment at the SIX Swiss Exchange
(SIX:CYTN).
This foregoing press release may contain forward-looking statements that
include words or phrases such as 'are intended for', 'are designed to',
'could be', 'will' or other similar expressions. These forward-looking
statements are subject to a variety of significant uncertainties, including
scientific, business, economic and financial factors, and therefore actual
results may differ significantly from those presented. There can be no
assurance that any further therapeutic entities will enter clinical trials,
that clinical trial results will be predictive for future results, that
therapeutic entities will be the subject of filings for regulatory
approval, that any drug candidates will receive marketing approval from the
U.S. Food and Drug Administration or equivalent regulatory authorities, or
that drugs will be marketed successfully. Against the background of these
uncertainties readers should not rely on forward-looking statements. The
company assumes no responsibility to update forward-looking statements or
adapt them to future events or developments. This document does not
constitute an offer or invitation to subscribe or purchase any securities
of Cytos Biotechnology Ltd.
End of Corporate News
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Language: English
Company: Cytos Biotechnology AG
Wagistr. 25
8952 Schlieren
Switzerland
Phone: +41 44 733 4747
Fax: +41 44 733 4740
E-mail: info(at)cytos.com
Internet: www.cytos.com
ISIN: CH0011025217, CH0029060735
Swiss Security Number: -
Listed: Regulierter Markt in SIX; Freiverkehr in
Berlin, München, Stuttgart; Open Market in
Frankfurt
End of News EquityStory AG News-Service
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135930 17.08.2011
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cytos-biotechnology-ltd-announces-strategic-and-organizational-changes-with-the-aim-of-preserving-value-around-its-lead-product-and-to-address-the-up
coming-maturity-of-the-convertible-bond
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Datum: 17.08.2011 - 07:00 Uhr
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