As a result of the reduction in workforce, effective August 3, 2007, the company expects to have less than 80 employees, a reduction of 45% from year end 2006. Nuvelo expects this realignment of personnel and programs to result in reduced annual expenses of approximately $15 million from current levels.
As part of the reorganization, Ward Wolff, senior vice president and CFO, will be leaving the company effective August 14, 2007. Lee Bendekgey will reassume the role of CFO in addition to his current role as senior vice president and general counsel. Mr Bendekgey previously served as CFO from July 2004 through November 2005.
The company is providing severance and career transition assistance to the employees directly affected by the restructuring, and Nuvelo anticipates incurring restructuring charges of approximately $2.5 million in the third quarter of 2007, primarily associated with personnel-related termination costs. As of June 30, 2007, Nuvelo had cash, cash equivalents and short-term investments of $120.2 million, which does not include the $15.0 million received from Bayer in the third quarter related to the termination of the 2006 collaboration agreement between Nuvelo and Bayer.