In an effort to reduce its burn rate by 50 percent andstreamline operations, Cellcor Inc. announced Tuesday that ithas begun a major overhaul of its corporate structure andbusiness strategy.
Cellcor's business is autolymphocyte therapy (ALT), a kind ofpersonalized approach to cancer therapy that it has beenmarketing through outpatient cellular therapy centersconnected with hospitals in Boston, Atlanta and Orange County,Calif. Not only will the Newton, Mass., company close itscommercial operations at those locations, but it also intends tocentralize cell processing facilities and reduce its work force by50 percent (from 87 people to 45).
The company reported a net loss for 1992 of $10.2 million, or$2.17 per share, on revenues of $2.7 million.
Autolymphocyte therapy involves growing a patient's ownwhite blood cells in vitro in the presence of a lymphokinecocktail and antigens to stimulate antibody production, thenreturning them to the patient. To date, Cellcor's cellular therapy"had been considered a medical procedure, similar to bonemarrow transplantation or in vitro fertilization, that iscontrolled by physicians," said Richard D'Antoni, Cellcor'spresident and chief executive officer.
However, in February the FDA's Center for Biological Evaluationand Review (CBER) established the division of cellular and genetherapies to establish relevant regulations specifically for thistype of therapy. So Cellcor is now intent on pursuing FDAapproval for ALT.
This strategic realignment could offer several distinctadvantages for the company. With ALT being offered regionallyas a medical procedure, Cellcor could not engage in interstatecommerce; each regional facility had to have its own cellprocessing operation. But with an FDA-approved product -- andFDA could regulate ALT as a biological drug, D'Antoni toldBioWorld -- Cellcor could centralize its cell processing facilitiesand coordinate pivotal clinical trials from a central location.
Cellcor (NASDAQ:CLTX) is currently seeking pivotal trial statusfrom FDA for a second randomized controlled trial of ALT inmetastatic renal cell carcinoma. The trial, which will compareALT with alpha interferon, should start later this year.Although Cellcor currently has no corporate partner for therenal cell carcinoma trials, "we wouldn't rule out anydiscussions for a strategic partner for this or any otherapplication of ALT," D'Antoni told BioWorld.
Cellcor has ongoing trials of ALT for treating renal cell cancerand early pilot studies on ALT in hepatitis B.
"We want to pull back from our burn rate, manage ourresources, and focus on getting ALT approved by FDA,"D'Antoni told BioWorld.
At the end of 1992, Cellcor had $13 million in cash and 5.4million shares outstanding. It raised $22 million in March 1992in its initial public offering of 2 million shares at $11 per share.The stock closed Tuesday at $1 a share, down 38 cents.
-- Jennifer Van Brunt Senior Editor
(c) 1997 American Health Consultants. All rights reserved.