Cerulean (CERU) to Slash More Than Half of Its Remaining Staff, Merge With SoCal Biotech
3/20/2017 7:15:00 AM
March 20, 2017
By Alex Keown, BioSpace.com Breaking News Staff
WALTHAM, Mass. -- Shares of Cerulean Inc. (CERU) have plunged more than 61 percent this morning after the company announced it was being acquired by privately-held Dare Bioscience and has sold off some of its assets to BlueLink Pharmaceuticals and Novartis (NVS).
The deals the company struck today will force the termination of 11 employees, more than half of its staff. The layoffs are expected to be completed later this year and will leave the company with a staff of eight. This round of terminations follows an August 2016 layoff of 48 percent of its workforce that was part of an effort to reduce operating expenses as the company refocuses its clinical strategies.
With the latest news, shares of Cerulean fell to a low of $1.06 per share, down from a morning high of $1.45.
This morning, Cerulean said it has sold its clinical product candidates, CRLX101 and CRLX301, to BlueLink Pharmaceuticals for $1.5 million. In August, the company announced CRLX101 in combination with Genentech (RHHBY)’s Avastin failed to show a statistical significance in progression free survival when compared to standard care agents in a Phase II renal carcinoma trial. That trial failure lead to the August layoffs. CRLX101 is a nanoparticle-drug conjugate (NDC) designed to concentrate in tumors and slowly release its anti-cancer payload, camptothecin, inside tumor cells. The experimental drug is a topoisomerase inhibitor.
In a separate deal, the company sold all rights to Cerulean's Dynamic Tumor Targeting Platform for $6 million. Cerulean and Novartis had already been collaborating, but the deal will send that to Novartis.
The remaining assets will be acquired by Dare and a new company, Daré Bioscience, will be formed to trade on the Nasdaq Exchange. Ovaprene is Dare’s clinical stage, non-hormonal contraceptive ring for monthly use. Ovaprene, is a non-hormonal option that is intended to be easy to use and provide protection over multiple weeks. The company said it is unaware of any comparable product currently on the market.
Sabrina Martucci Johnson, current Chief Executive Officer of Daré Bioscience, will helm the new company. In a statement, Johnson said women’s reproductive health includes a broad spectrum of categories, many of which have unmet needs. She said “Daré is committed to developing a portfolio that expands options, improves outcomes, and enhances safety for women."
Christopher D. T. Guiffre, president and CEO of Cerulean, said the company had been looking at strategic alternatives to maximize value for Cerulean shareholders and the deal with Daré, along with the sale of its assets, is the best move for the company.
“Based on Daré's current projections, with proceeds from the sale of Cerulean's assets, we believe the combined company will be well funded to advance Ovaprene through the completion of a postcoital proof of concept study that is expected to be a value inflection point and is expected to commence following closing of this transaction,” Guiffre said in a statement.
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