AVEO Oncology Relocates HQ to Smaller Facility in Cambridge After Corporate Restructuring
May 26, 2015
By Alex Keown and Riley McDermid, BioSpace.com Breaking News Staff
CAMBRIDGE, Mass.—AVEO Oncology relocated its offices in Cambridge as part of a cost containing plan during the company’s restructuring plans announced in January, which saw a shift in executive officers as well as the termination of approximately two-thirds of its workforce.
In addition to the smaller space in Cambridge, AVEO also unveiled a new corporate logo.
The new site in Cambridge is considerably smaller than the company’s previous facility, a 90 percent reduction in facilities from the company’s prior Cambridge location at 650 E. Kendall Square. The site, at One Broadway, includes 5,000 square feet of office space under flexible lease terms, with no laboratory or vivarium space.
“AVEO is now a streamlined organization with its resources squarely focused on the execution of a strategy aimed at leveraging biomarker insights and exploring partnership opportunities to advance our pipeline. We look forward to making progress toward our goals in the near future, and to outlining a path forward for the new AVEO,” Michael Bailey, AVEO’s president and chief executive officer, said in a statement.
The company chopped two-thirds of its workforce earlier this winter. Prior to January’s restructuring, Bailey served as the company’s chief business officer, but in January he took over the company’s top spot. He replaced Tuan Ha-Ngoc, who became chairman of the board of directors. Henri Termeer, who previously served as chairman, became lead outside director. Additionally the company slashed about 40 employees, which included elimination of the AVEO’s internal research function.
The restructuring occurred, in part, due to its pipeline, including AV-380, a first-in-class GDF-15 inhibitor, having gone past the research stage. In a January statement Bailey said “streamlining operations” provides the company with an opportunity to “evaluate biomarker-driven clinical strategies and partnerships to advance our pipeline without continuing to incur internal research expense.”
AV-380 is being evaluated for the treatment of cancer cachexia, with possible treatments for chronic kidney disease, congestive heart failure and chronic obstructive pulmonary disease. Cachexia is a complex metabolic syndrome associated with malnutrition and severe involuntary weight loss due to the loss of muscle and fat tissue. In April AVEO released data from clinical trials on mice that showed AV-380 may reverse the effects of cachexia. The company said it will pursue partnerships to “realize the full potential of AV-380 within and beyond cancer cachexia.”
Last month AVEO announced its lead product candidate, tivozanib, a second-line treatment in patients with advanced renal cell carcinoma that progressed after treatment with Onyx Pharmaceuticals, Inc.’ Nexavar, provided a median overall survival of 21.6 months, according to a report in Seeking Alpha.
Before AVEO began its restructuring, the company saw its stock sales dwindling. In December the company received a warning from NASDAQ that its stock price was too low to continue to be listed on the exchange. A NASDAQ rule requires that a company’s stock price cannot sell for less than $1 for 30 consecutive days. They were automatically granted a 180-day period, ending June 29, in which it can appeal for another 180-day grace period. To be reinstated to the NASDAQ the stock will need to trade at $1 per share or above for 10 consecutive days, which it has consistently done since March. AVEO’s stock saw a high this morning of $2.75 per share.
There have been some bright spots for the company, however few and far between. In mid-November 2014, Aveo entered into a research and option agreement with Ophthotech Corporation that will give Opthotech exclusive rights outside of Asia to investigate tivozanib, which has the potential to treat non-oncologic diseases of the eye.
Tivozanib is a small molecule vascular endothelial growth factor (VEGF) tyrosine kinase inhibitor.
Under the terms of the deal, Ophthotech paid AVEO an upfront option fee of $500,000, and if it elects to continue development of the ocular formulation of tivozanib during the option term, it will pay AVEO up to $8 million in milestone payments.
If Opthotech decides to obtain additional development and commercialization rights to tivozanib and products containing tivozanib for non-oncologic eye indications in territories outside Asia, AVEO would receive an option exercise fee of $2 million and could also receive clinical and regulatory-based milestone payments of up to $50 million, as well as sales-based milestone payments of up to $45 million and royalties.
A percentage of all upfront, milestone and royalty payments received by AVEO are due to Kyowa Hakko Kirin as a sublicensing fee. AVEO executives were delighted by the deal at the time.
"This agreement is another example of our execution against AVEO’s key strategic objective of advancing our pipeline assets through external resources and expertise," said Tuan Ha-Ngoc, president and chief executive officer of AVEO.
“We believe the unique properties of tivozanib make it an ideal VEGF inhibitor for potential ocular use, and we are encouraged by Ophthotech’s interest in exploring this potential,” he said. “This agreement could enable us to realize value for tivozanib in an indication outside of cancer, while retaining oncology rights for further development through additional potential partnerships.”
AVEO Oncology develops targeted therapies for patients with cancer. Its proprietary Human Response Platform is designed to treat and provide palliative care for oncology therapies, as well as study related disease biology.
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