iCo Therapeutics Terminates Employees in Radical Restructuring Move
January 18, 2016
By Alex Keown, BioSpace.com Breaking News Staff
VANCOUVER – iCo Therapeutics Inc. has undertaken a radical strategic reorganization that includes the termination of all employees in order to preserve cash resources while attempting to continue developing its experimental Oral Amphotericin B for the treatment of infectious diseases.
The reorganization comes about a year after the Phase II failure of iCo-007 injectable therapy for Diabetic Macular Edema. Following the Phase II trial of iCo-007, the drug showed negative results related to the eight-month visual acuity primary endpoint of the trial. In a statement this morning, the company said it has been unable to pursue deals with other pharma companies to help develop its product, or acquire “additional life science assets” to bolster its position.
iCo’s executive officers will also feel the bite of the reorganization as well, although they will maintain a sense of employment. Andrew Rae, the company’s chief executive officer, and John Meekison, the chief financial officer, will be retained in a “reduced consulting capacity” in order to continue the company’s operation. Peter Hnik, the company’s chief medical officer, will also remain in a consulting capacity. In its statement, iCo did not specify how many employees are currently in its employ or when the terminations would begin.
“Management continues to believe that the current market capitalization of the company does not accurately reflect iCo's intrinsic value, given our current cash position of approximately $3.38 million dollars—after giving effect to all severance liabilities—plus the value of our iCo-008 and Oral Amphotericin B assets,” Rae said in a statement.
Given the price of the company stock, trading at 4 cents per share this morning, Rae said seeking to raise equity capital to enhance the value of company assets would “prove to be excessively dilutive.”
“To date, post a detailed review of many opportunities, we have been unable to conclude a value enhancing transaction which would have made sense for iCo and its shareholders,” Rae said.
Although the reorganization is a drastic measure, iCo said it remains excited about some of the work being done with its other pipeline products, including Bertilimumab, for the treatment of bullous pemphigoid and ulcerative colitis. iCo said it expects data from a Phase II trial being conducted by Immune Pharmaceuticals in the fourth quarter of this year. iCo maintains all rights to use Bertilimumab for eye diseases, and will continue exploring opportunities to partner this asset, the company said.
In addition to Bertilimumab, iCo is preparing for clinical trials of its Oral AmpB compound. Rae said the company is looking for funding methods, including grants or partnerships with other companies, to support moving this trial forward.
In order to preserve as much of iCo as possible, Rae said the company will look for new business opportunities in the life science industry as well as other industries.