Greenwich Pharmaceuticals Inc., reeling from the recent failed clinicaltrials of its two lead drugs, announced Wednesday a further layoff ofabout three-quarters of its remaining employees. Five or six employeeswill remain.A company official said Greenwich intends to remain in businessdespite Tuesday's announcement that an additional review of its leaddrug, Therafectin, affirmed earlier opinions that it was ineffective intreating rheumatoid arthritis. On May 2, Greenwich released Phase IIresults of its second rheumatoid arthritis drug, GW-80126, that showedit no more effective than placebo.Greenwich (NASDAQ: GRPI) stock, trading at more than $15 in April1992, was down 19 cents Wednesday, closing at 50 cents per share.Greenwich has about 35 million shares outstanding.The Fort Washington, Pa., company announced in February, after anFDA advisory committee's recommendation against approval ofTherafectin, that it was laying off 44 of its 68 employees.Among those leaving in this round of cuts is Ed Thompson, thecompany's chairman, president and CEO."He has devoted the past six or seven years of his life and a whole lotof blood, sweat and tears to this operation, and he would like to moveon to something else," said Jeff Randall, Greenwich's chief financialofficer. "It's a very emotionally wrenching situation," he toldBioWorld.Randall said "from a management point of view, I will probably be thefocal point, for the time being anyway." He said the board of directorsalso will be involved.Staying on is one person in preclinical research, one in manufacturingand facilities, and the other three or four in finance and administration,Randall said.Greenwich also announced Wednesday a proposed settlement of alllawsuits filed against the company over the past two years, mostlyinvolving the company's public statements about Therafectin. Thesettlement amount is $4.38 million. Factoring in insurance payments,the company will pay about $1.9 million in defense costs and its shareof the settlement.Also on Wednesday, Greenwich released its first-quarter financialstatements that showed net working capital of about $5.4 million as ofMarch 31, which it expects will be enough to sustain the company formore than 12 months."The major focus is the fact that we're not going out of business,"Randall said. "Our focus has shifted and narrowed. We're very activelylooking for a partner . . . interested in developing the technologies andcompounds the company has in its inventory."Included in those is GW92527.HCl, which has completed one Phase Itrial for rheumatoid arthritis. A second Phase I trial has been put onhold.Randall said the company has not decided whether to attend a meetingwith the FDA regarding the agency's non-approval of Therafectin. Afinal recourse, after the meeting, would be a hearing with anadministrative law judge.
-- Jim Shrine
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