SAN DIEGO--AVANIR Pharmaceuticals announced today that it has taken several steps intended to significantly reduce ongoing operating expenses. Effective immediately the Company has suspended all commercial initiatives focused on Zenvia(TM) for the treatment of involuntary emotional expression disorder (IEED) and has reduced research and development expenses including placing on hold activities associated with the selective cytokine inhibitor clinical development program. These actions have led to a 16% reduction in the Company's current workforce. The Company has implemented these changes to reduce its cash burn rate to a goal of approximately $10 million per quarter, before estimated severance costs of approximately $800,000.
These actions were taken following receipt of an Approvable Letter from the U.S. Food and Drug Administration (FDA) for Zenvia. Since that time, the Company has assembled a team of professionals dedicated to addressing the Agency's concerns. The Company has added to Dr. Randall Kaye's responsibilities by appointing him as the new head of clinical development. Dr. Kaye, Vice President of Medical Affairs, and his team are dedicated to developing a comprehensive plan intended to address the concerns expressed by the FDA in its Approvable Letter. Once prepared, the Company will request a formal meeting with the FDA to ascertain the appropriate next steps required to pursue marketing approval for Zenvia. The Company currently believes that this meeting will most likely take place within the next 60 days.
Zenvia is dextromethorphan, an cough suppressent derived from opioids. It inhibits the NMDA receptors in the brain that induce the cough reaction. It is approved for the treatment of involuntary emotional expression disorder ("IEED").
The biotechnology company (NASDAQ:AVNR)is trading at $2.89 or up 4 cents afternoon trading.
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