Unilife Axes 40% of Workforce, Names New CEO

July 28, 2016
By Alex Keown, BioSpace.com Breaking News Staff

YORK, Pa. -- Pennsylvania-based Unilife Corporation continues to reduce its workforce as it shifts its business focus on active and new customer programs in its portfolio of wearable injector systems. As part of its new strategy, the company formally tapped John Ryan, who has been serving as interim head, as the new president and chief executive officer.

As part of its new strategic focus, Unilife said the primary focus on wearable injectors is expected to “enhance operating efficiencies and better position the company to take advantage of commercial opportunities within the fast-growing market for wearable injectors,” the company said. Unilife has struck a number of collaborative deals for wearable injectors with companies like Sanofi and MedImmune , a subsidiary of AstraZeneca . Unilife has also entered into a collaborative deal with Amgen earlier this year. Amgen will use Unilife’s injectable devices for the delivery of its large and small volume products. Under terms of the deal, Amgen will pay Unilife for each device it manufactures.

But, despite the growth through collaborative deals, Unilife has undergone several workforce reductions. In September 2015, the company slashed about 17 percent of its employees to help reduce operating expenses and that trend continues through today. In a statement the company said it has reduced approximately 40 percent of its staff since the beginning of 2016, leaving the company with about 140 employees. Not only has the company reduced its headcount, but it has also sublet a “significant portion” of the space it leases as part of a cost reduction measure, which the company added is “ongoing.”

Ryan, the new CEO, said the cost reduction measures will result in a reduction of its cash-burn rate, which he said will enhance shareholder value.

“We believe we have the right pieces in place to deliver for our customers with financial discipline, rigor, and efficiency,” Ryan said in a statement.

Ryan was elevated to the position of CEO following the departure of former head Alan Shortall, who left the company under a cloud of violations of company policies and procedures as well as possible legal and regulatory violations, the company said. Following an internal investigation, Unilife said it appear there was no financial cost to the company resulting from the allegations, but said it will continue to investigate. The internal investigation focused on matters of financial reporting, internal controls over financial reporting related to previous financial statements, current financial information and management certifications, the company said in a statement earlier this year.

In addition to tapping a permanent CEO, Unilife also made some additions to its leadership team. Ian Hanson, who served as senior vice president and general manager, was named chief operating officer. Molly Weaver was tapped as Unilife’s chief compliance officer and David Hastings was named chief accounting officer. The company appointed Michael Kamarck, former president of Merck BioVentures, to its board of directors.

While the company rights itself with its new strategic plan and leadership changes, Unilife is also seeking to come back to compliance with NASDAQ listing rules. In May, the company was notified it was not in compliance with listing rules because it had not filed its required 10-Q report by the March 31 deadline. Unilife said it submitted a plan to NASDAQ earlier this month to regain compliance.

Shares of Unilife are currently trading at $3.97, significantly down since a high last July of $18.70 per share.