By Debbie Strickland

Staff Writer

Another Colorado-based biotech firm is downsizing following the loss of a big pharma partner. One day after Boulder-based Somatogen Inc. cut its workforce from 204 to 137 employees, Cortech Inc. Thursday unveiled a plan to slash its full-time staff from 75 to approximately 30.

The job cuts are "across the board" and range up to the vice presidential level, according to Joe Turner, chief financial officer of the Denver-based company.

"The intent of this lay-off is to cut the rate of burn while maintaining the ability to conduct meaningful research," Turner said. As of March 31, Cortech had $20.5 million in cash, or $1.11 per share, with a burn rate, exclusive of payments from former partner SmithKline Beecham plc, of $6 million per year.

Following the job eliminations, the burn rate likely will fall by more than 50 percent, Turner estimated, but the company faces a restructuring-related quarterly charge in an as-yet-undetermined amount.

By midday Thursday, Cortech's stock (NASDAQ:CRTQ) was trading at $0.75 per share, down from $0.81 per share at Wednesday's close.

In late March, London-based SmithKline Beecham discontinued development of Bradycor, Cortech's bradykinin antagonist, in the wake of disappointing Phase II clinical trials on brain injury patients. The trials showed the drug had no significant effect on the primary endpoint, intracranial pressure.

"It's most likely the end of the road for Bradycor," Turner said.

Cortech will, however, continue to monitor the Bradycor trial results, tracking long-term outcomes and secondary endpoints, said Jan Troha, senior director of clinical affairs.

The company has no other active clinical trial, nor any product yet on the market.

Negotiations are under way with several prospective research and development partners, but in the meantime Cortech will continue working on several projects related to its goal of developing treatments for inflammatory disorders:

* With funding from Osaka, Japan-based Ono Pharmaceutical Co. Ltd., Cortech is pursuing preclinical development of orally bioavailable inhibitors of the protease neutrophil elastase, which could lead to anti-inflammation drugs. That project is "at the stage of medicinal chemistry," Troha said.

* The company has launched preclinical research of another bradykinin compound more potent than Bradycor, CP-0597, a potential treatment for acute ischemic stroke.

* Cortech also is continuing a drive to apply its proprietary technology to the discovery of compounds capable of inhibiting a range of therapeutically interesting proteases.

* A lesser priority is the reassessment of the implications of the toxicity profile of CE-1037, a parenteral human neutrophil elastase inhibitor designed to treat acute respiratory distress syndrome and cystic fibrosis. The compound, which Cortech developed with ex-partner Hoechst Marion Roussel, made it to a Phase II clinical trial before Hoechst pulled out, in part because of disappointing preclinical findings. *