Cortech Inc. cut back on manufacturing operations Tuesday, layingoff 34 of its 175 employees, in an effort to save $3 million a year andconserve resources for clinical development programs.

Joseph Turner, Cortech's chief financial officer, said the Denver-based company decided to decrease manufacturing activities afterdetermining it had sufficient quantities of its lead drugs, Bradycorand Sulfasim, for clinical trials.

Although production is being scaled back, Turner said, the Denverplant will remain open with the ability to boost manufacturingcapacity when needed.

The staff reductions represent a 20 percent decrease and are expectedto save about $750,000 per quarter. As of Dec. 31, 1994, Cortechreported a quarterly burn rate of $5.7 million and said it had $36.3million in cash.

The layoffs decrease Cortech's work force to 141, which is 65 fewerstaffers than the company had last July prior to experiencing a majorset-back when Bradycor failed in Phase II sepsis trials. Turner saidno additional employee cuts are planned.

Bradycor, a bradykinin antagonist, is in a second Phase II trial forsepsis as well as Phase II studies for multiple trauma. The companyalso anticipates starting another multicenter trial for head trauma.Sulfasim, an antigen-specific immunomodulator, is expected to enterPhase I/II trials for sulfamethoxazole allergies in HIV-infectedpatients this year.

In addition to Bradycor and Sulfasim, Cortech is developing elastaseinhibitors under agreements with Marion Merrell Dow, of KansasCity, Mo., and Ono Pharmaceutical Co. Ltd., of Osaka, Japan.

In the collaboration with Marion Merrell, Cortech has filed aninvestigational new drug application for CE-1037, an elastaseinhibitor to treat acute respiratory distress syndrome. Clinical trialsupplies of the drug will be manufactured by Marion Merrell.

Cortech's stock (NASDAQ:CRTQ) closed Tuesday at $2.50, up 6cents. n

-- Charles Craig

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