GPC Biotech AG is continuing to radically prune its organization. The latest round of job cuts, announced Monday, will trim the company back to just 63 employees: 14 in its Munich, Germany-based headquarters and 49 at its Princeton, N.J., clinical development site.
The cutbacks primarily affect the company's early stage research activities in Munich.
Two of the company's co-founders and senior executives are leaving - Chief Operating Officer Elmar Maier and Chief Scientific Officer Sebastian Meier-Ewert - although they will be available to the company in an advisory capacity.
GPC had 316 people on the payroll as recently as last August. That was before the first of several rounds of job cuts was initiated, following the failure of its prostate cancer drug satraplatin, first to gain fast-track approval in the U.S., based on progression-free-survival data, and then to demonstrate an overall survival benefit in a Phase III registration trial.
GPC entered 2008 with about €65 million (US$96.4 million) cash, enough, it said, to fund its activities for the next three years. It now plans to focus its resources on continued development of satraplatin, an orally available platinum compound, which is still in several combination trials, and on a series of cell cycle inhibitors that are still in preclinical development.
"We intend to start a clinical program within the next six months," GPC Biotech spokesman Martin Braendle told BioWorld Today.
The company is consulting with its partners - Boulder, Colo.-based Pharmion Corp. in Europe and Tokyo-based Yakult Honsha Co. Ltd. in Japan - and with opinion leaders on a future development path for satraplatin, but it will be some time before that becomes clear. A response to Pharmion's marketing application authorization, which it filed with the London-based European Medicine's Agency last June, is expected in the second half of this year.
The company is "not currently" thinking of consolidating the company to a single location, Braendle said. "We still are a German 'AG' [an abbreviation for 'Aktiengesellschaft' or corporation], and the headquarters are still in Germany. If you run a trial in Europe, you need people over here," he added.
The company will move one of its cell cycle inhibitors, RGB-286638, into a Phase I clinical trial in solid tumors initially. A second Phase I study, in a hematologic cancer, will follow soon afterward in the U.S.
The company has, however, decided to halt development of a monoclonal antibody, 1D09C3, which had been in development for relapsed/refractory B-cell lymphomas. The molecule belongs to the IgG4 family, members of which exhibit a domain swapping property that can result in the formation of new antibodies with unknown effects. GPC said 1D09C3 displays that activity.
The company also is exploring other potential avenues of expansion. "We do not rule out in-licensing. Probably more of a focus is M&A," Braendle said. The ideal candidate would be an oncology firm, preferably with clinical stage assets.
The latest move looks as if the company is grooming itself for a merger with an American oncology firm, said one analyst who preferred to remain anonymous. "It now looks like Munich is basically dead, with 14 people there," he said. The fact that its current cash will last for three years "really implies that nothing big will happen in the meantime."
Novacea, Inc., of South San Francisco, is one potential candidate, he said, as it has about $100 million in cash and pipeline problems of its own.
"Two fallen angels will put their cash together and try something new," he said.
The stock (Frankfurt:GPC; NASDAQ:GPCB) closed at €2.64 on the Xetra electronic exchange in Frankfurt Monday, up 5.6 percent on Friday's close.