Seattle-based VLST is laying off about two-thirds of its staff as it seeks to save cash for clinical trials of a cancer drug candidate it licensed from Pfizer, Xconomy has learned.
The biotech company will be downsizing from 17 employees to five at the end of this year, CEO Martin Simonetti says. VLST is eliminating its biological target discovery group at the end of this year, once it fulfills the last obligations to one of its partners, Belgium-based UCB. The job cuts were made so that VLST can concentrate its resources into clinical trials of an experimental cancer drug it obtained last month from Pfizer, Simonetti says. VLST plans to hire a couple more people next year with development expertise to help move that drug candidate forward, he adds.
“We have very limited resources, and we had to make these extremely difficult decisions,” Simonetti says. Without another scientific partner supporting VLST’s target discovery group in 2013, and new expenses adding up for the company’s clinical trials in the coming year, VLST realized it couldn’t afford to keep doing everything it had been doing before, he says.
The layoffs at VLST come at a rough time in the local biotech job market. Seattle-based Dendreon (NASDAQ: [[ticker:DNDN]]) said this week it will be laying off 145 local workers in November, as part of a previously announced round of 600 job cuts companywide.
VLST raised $5 million in June from ARCH Venture Partners, OVP Venture Partners, WRF Capital and Versant Ventures, and has pulled in about $50 million total since its founding in 2004. The company has spent much of its resources working to identify new molecular targets for fighting autoimmune diseases, and has gotten support from partners that include Novo Nordisk, Takeda Pharmaceuticals, and UCB.
The VLST scientific group has been prolific, Simonetti says, producing about 20 different programs that partners have evaluated for their own drug development purposes. VLST is currently seeking to pull in extra cash by out-licensing a wholly owned drug program called antikine, which is being prepared for clinical development.
