Vical slashes staff in restructuring in wake of Allovectin failure

US drug developer Vical (Nasdaq: VICL) has announced a restructuring to conserve capital, including a staff reduction of 47 employees, around 39% of the company's total workforce. Following the restructuring, the company will have approximately 74 employees.

In addition, the company is focusing its resources on its infectious disease vaccine programs and terminating activities related to Allovectin (velimogene aliplasmid), an investigational intratumoral cancer immunotherapy, which recently failed to meet its Phase III efficacy endpoints, news that caused a 60% slump in the firm’s share price (The Pharma Letter August 12).

"We have evaluated our organization and priorities and are restructuring to extend our cash runway to ensure that our promising infectious disease vaccine programs are adequately resourced to create maximum shareholder value," said Vijay Samant, Vical's president and chief executive, adding: "This has been a very difficult process and we regret the impact this business decision has on our departing employees."