BioWorld International Correspondent

Biovitrum is laying off up to one-third of its R&D organization in a belt-tightening exercise aimed at supporting its switch from early stage discovery to late preclinical and clinical development.

The Stockholm, Sweden-based firm has 580 employees, although more than 250 of them are involved in either its contract manufacturing and process development unit, in Nordic region drug sales and marketing, or in support functions.

The company aims to cut between 70 and 100 positions in early stage discovery research from its 300-strong R&D group, in order to maintain its level of expenditure even though costs are rising as a growing number of projects enters the clinic.

"Our board has given us a financial framework, and they want us to have a run rate that will not increase just because we move into clinical development," Biovitrum's vice president of communications, Anna Karin K llén, told BioWorld International. At present, the company spends about $70 million on R&D.

The company has not finalized the restructuring plan but decided to announce its intentions at an early stage in the process to avoid wrongful speculation, K llén said. Biovitrum will retain some early stage discovery capability.

"We will still have delivery of [candidate drugs] internally," she said, adding that she couldn't be more precise. "We just don't have the answers today," she said. The company has initiated talks with trade unions, and aims to finalize the restructuring plan by early December.

Biovitrum strengthened its pipeline through two acquisitions earlier this year: Cambridge Biotechnology Ltd., of Cambridge, UK, and Arexis AB, of Gothenburg, Sweden. The latter deal brought in what now is its lead project, the development of bile salt stimulated lipase for treatment of fat malabsorption in cystic fibrosis patients with pancreative insufficiency. The program has completed a Phase II trial and will enter a Phase IIb study next year. Cambridge Biotechnology also brought in a clinical-stage project. The compound, called BVT.115959, a selective A2A adenosine receptor agonist, is in development for inflammatory pain.

The company recently moved an internal project, BVT.28949, into a Phase I trial for glaucoma. Its two major external collaborations, with Thousand Oaks, Calif.-based Amgen Inc. and London-based GlaxoSmithKline plc, remain in preclinical development.