Isis restructuring will cut 40% of workforce

“Through our investment in antisense we have advanced the technology to a point where we and our partners now have extensive clinical and pre-clinical development pipelines that are full of product opportunities. As a result of this productivity, we have far more drug assets than we can afford to develop on our own and, therefore, we believe we can better achieve our strategic goals with a smaller organization,” said Dr Stanley Crooke, CEO of Isis.

In line with the restructuring, Isis will focus its resources on its most important R&D activities to advance its product pipeline. In order to achieve a more focused drug portfolio, the company has decided to stop the development of two “low priority” drugs, ISIS 14803 in hepatitis C and ISIS 104838 in rheumatoid arthritis.

“We are strategically reexamining our assets and will incur non-cash write downs of tangible and intangible assets in areas that are non essential to our current focus,” stated B. Lynne Parshall, executive vice president and chief financial officer of Isis “We anticipate that these write downs will occur primarily in the fourth quarter of 2004 with an initial estimate of $30 – $40 million.”

“Further restructuring charges including those associated with termination costs will be incurred in the first quarter of 2005,” she continued. “Before the restructuring charges, we are on track to meet our net operating loss target for 2004, which is in the mid-$80 million range, excluding non-cash compensation expense.”

Isis shares have risen almost three percent following the announcement.