As clinical data percolates with a pair of products - one that's already marketed and being tested for a new indication - QLT Inc. said it is reducing its work force by 65 people, or about 18 percent, to trim operating expenses and focus more tightly on development programs.
"These are not really the same kind of cutbacks other folks have done," said Paul Hastings, president and CEO of Vancouver, British Columbia-based QLT.
"We simply had more people in the company than we had projects for them to work on, and we adjusted from a position of strength," he told BioWorld Today. "No guidance has changed on sales or earnings."
QLT will take a restructuring charge of about C$4.5 million (US$2.85 million), but the moves are expected to result in annualized savings of about C$5 million.
Sales of Visudyne (verteporfin) for the wet form of age-related macular degeneration are estimated by the company to hit between US$275 million and US$300 million this year.
"They won't have any trouble making that," said Brian Bapty, analyst with Raymond James Ltd. in Vancouver, who acknowledged the drug faces potential competition from Fort Worth, Texas-based Alcon Research Ltd.'s modified steroid, Anecortave Acetate, which entered a two-year, head-to-head Phase III study with Visudyne for AMD earlier this year. (See BioWorld Today, Sept. 5, 2002.)
"There are lots of drugs in trials for AMD now," Bapty said. "Good luck to them, as near as I can tell. The early data is sort of compelling, but we've seen that before. You've really got to wait until you have one-year data [in a later-stage trial]."
Visudyne is partnered with Novartis Ophthalmics, the eye health unit of Novartis AG, of Basel, Switzerland. For the three months ended Sept. 30, revenues totaled C$41.36 million, compared to C$30.77 million in the same period last year.
Bapty noted Visudyne sales have seemed to be slowing, but the perception may be due to earlier overshot estimates.
"The previous management team were great researchers, but lousy forecasters," he said. "That's one of the reasons it's been so much fun to beat these guys up in the last year and a half." Bapty said the management situation has improved, and sales are in line with reasonable expectations.
Hastings agreed and said that, even if other AMD drugs are approved, "they'll probably be adjuvant or combination therapies, much like [those for] other complicated diseases."
QLT, meanwhile, is seeking approval for occult AMD in the U.S., with a second Phase III trial ongoing.
"All we have to do is repeat the results from the earlier trial, which were enough for the European [regulatory] agency," Hastings said. Visudyne is approved for occult AMD in Europe. Results from the trial are expected at the end of 2004.
In August 2002, QLT and Novartis completed enrollment for a retreatment Phase IIIb trial in patients with predominantly classic subfoveal choroidal neovascularization secondary to AMD. The study is investigating an earlier, more aggressive and frequent treatment regimen, with results expected in the fourth quarter of 2003.
QLT also has Visudyne in Phase III trials for multiple basal cell carcinoma, with data expected in the first half of 2005, about the same time Phase III data from two trials are due regarding the P-glycoprotein membrane inhibitor tariquidar, in-licensed from Slough, UK-based Xenova Group plc, being explored as an adjunct with first-line chemotherapy in non-small-cell lung cancer. (See BioWorld Today, July 1, 2002.)
QLT's stock (NASDAQ:QLTI) closed Friday at $9.69, up 6 cents.