Gensia Inc. said Tuesday that it's restructuring its operations in orderto conserve cash. As part of the move, the San Diego companyeliminated 35 positions on Friday.

The company also released its fourth-quarter and year-end resultsTuesday. Gensia reported a net loss of $50 million for the year, butonly $3.6 million for the quarter, and cash and equivalents of $53.6million as of Dec. 31.

Investigators released data in October showing that Gensia's leadproduct, Protara, did not show statistical significance in a Phase IIItrial for myocardial infarction during heart surgery. The companystopped development of the compound, and it stock dropped 51percent on the news, from $10.37 to $5.06. (See BioWorld Today,Oct. 18, 1994, p. 1.)

Gensia's stock (NASDAQ:GNSA) was up 19 cents Tuesday, closingat $3.31 per share.

Gensia suffered a second setback in January when it had to delay thefiling of an abbreviated new drug application (ANDA) forGeomatrix nifedipine, a combination of the Gensia's Geomatrixcontrolled drug-delivery technology and a generic form of PfizerInc.'s Procardia XL, for a cardiovascular indication.

The problems, a spokesman said in January, occurred because ascale-up formulation of Geomatrix nifedipine did not meetbioequivalency standards. That resulted in postponements ofpayments from collaborator Boehringer Mannheim PharmaceuticalsCorp., of Gaithersburg, Md.

Boehringer Mannheim paid Gensia $10 million in cash and made a$10 million equity investment when the potential $64.5 million dealwas signed in October. Milestone payments were delayed andreduced because of the delayed ANDA, a spokesman said in January.

Gensia officials did not return calls from BioWorld Tuesday.

Brandon Fradd, a biotechnology analyst with Montgomery Securitiesin San Francisco, said the company's move was the natural one tomake given its position.

"They have about one to two years of cash," Fradd said. "They haveto cut expenses or raise cash.

"This sort of thing has been happening a lot lately," Fradd said. "Youeither cut expenses, get more cash and revenue, or go bankrupt."

David Hale, Gensia's chairman, president and CEO, said in a newrelease, "This restructuring will allow us to reduce our overall burnrate while continuing to focus on building our commercialoperations. The company is also seeking to establish strategicalliances which could fund its research programs and further reduceits burn rate."

The company said four "corporate officer positions" were part of thereduction, but did not elaborate. Since October, 44 positions havebeen eliminated in San Diego and Europe. The company would notsay how many employees it had.

Gensia reported product sales of $52 million in 1994, compared to$17 million in 1993. It said it intends to focus more resources oncommercialization activities in the U.S. and Europe.

The company said its European sales and marketing organization isgearing up for the launch of the GenESA system in the secondquarter of 1995. The system combines the drug arbutamine and acomputer-controlled administration system designed topharmacologically stress the heart to aid in the diagnosis of coronaryartery disease. It is used in conjunction with electrocardiography,echocardiography and radionuclide imaging. n

-- Jim Shrine

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