March 29, 2016
By Alex Keown, BioSpace.com Breaking News Staff
CAMBRIDGE, Mass. – Citing a need to invest in growth of its drug products, Ariad Pharmaceuticals slashed 25 percent of employees in the U.S. and Europe, the company announced Tuesday afternoon.
Ariad said the job reductions are part of a strategic review aimed at increasing patient and shareholder value, in the second quarter of 2016. In addition to job cuts, Ariad said the company was also focusing on “an evaluation of commercial maximization initiatives, geographical presence, R&D portfolio and business development opportunities to support the overall strategic direction.” There have been some questions as to whether or not Ariad is positioning itself for a potential acquisition.”
The job reductions will include approximately 90 positions across the U.S. and Europe, the company said. None of the reductions will include “customer-facing” positions within the company’s commercial or medical affairs organizations, Ariad said.
Paris Panayiotopoulos, Ariad’s new president and chief executive officer, said the layoffs will allow the company to “invest in the promising growth potential of both Iclusig and brigatinib,” as well as enabling orphan oncology medicines to reach cancer patients.
In late 2012, Ariad’s blood cancer drug, Iclusig, was approved for use by the U.S. Food and Drug Administration (FDA). But in 2013, the company halted marketing it after the FDA warned about dangerous side effects. At this point, the company laid off 160 people, reevaluated its plans for a new headquarters at Cambridge’s Kendall Square, and its stock plunged. In 2014, Ariad inked a $77.5 million deal with Japanese firm Otsuka Pharmaceutical, giving Otsuka the rights in 10 Asian countries to Iclusig.
Iclusig is also involved in several clinical trials to expand its clinical indications. Those include the OPTIC-2L trial, a Phase III study in patients with chronic-phase chronic myeloid leukemia (CP-CML) who did not respond to imatinib. It is also currently enrolling patients in the OPTIC trial of Iclusig to evaluate three different doses of the drug in patients with refractory CP-CML.
During a conference call with investors in February, there was talk of Ariad increasing the price of Iclusig. Marty Duvall, Ariad’s chief commercial officer, said at the conference call, “At this point in time, we have not had pushback from payers regarding the pricing of Iclusig,” although he added, “our emphasis is really going to be on driving demand,” not on hiking prices.
Brigatinib is an investigational cancer drug for the treatment of patients with anaplastic lymphoma kinase positive (ALK+) non-small cell cancer (NSCLC) whose disease is resistant to crizotinib. It is currently being evaluated in a Phase II trial. Brigatinib received Breakthrough Therapy designation from the U.S. Food and Drug Administration in October 2014.
Ariad has been in the midst of an executive shuffle, tapping a new CEO and chief financial officer over the past few months. On March 11, the company announced former Pharmacyclics executive Manmeet S. Soni would take on the CFO spot. In December, Panayiotopoulos took over the top spot at Ariad after leaving a position as president of EMD Serono, Inc., a division of Germany-based Merck KgaA . Ariad also tapped a new chairman for its board of directors, Alexander J. Denner, who led the search committee for the company’s new CEO. Denner was the head of hedge fund Sarissa Capital, the largest shareholder of Ariad stock. Denner was widely thought to be behind the company’s former CEO Harvey Berger, who Panayiotopoulos replaced.
