Threshold Pharmaceuticals, Inc. (NASDAQ:THLD) announced that it has initiated a significant reduction in its workforce in order to focus the company’s financial resources in the near term on two ongoing Phase 2 proof-of-concept clinical trials of tarloxotinib bromide* (“tarloxotinib”), the company’s novel epidermal growth factor receptor tyrosine kinase inhibitor (EGFR TKI) licensed from the University of Auckland, New Zealand.
Threshold will reduce its workforce by approximately two-thirds, resulting in between 20-25 remaining employees. Threshold anticipates the one-time severance-related charge associated with the workforce reduction to be approximately $2.6 million, which includes approximately $0.3 million of non-cash expense related to the extension of the post-termination exercise period for the outstanding vested stock options for the affected employees. The majority of the charges will be paid by the end of the first quarter of 2016.
“We are enacting this reduction in workforce as a result of the recently announced outcomes from our two Phase 3 trials of evofosfamide in which neither trial met its primary endpoint of demonstrating a statistically significant improvement in overall survival,” said Barry Selick, Ph.D., Chief Executive Officer at Threshold. “I would like to express my sincere gratitude to our employees who are being affected by this difficult but necessary action. This is a loss to our Threshold family of talented and dedicated individuals who have worked with integrity and passion towards improving the lives of people living with cancer.”
Dr. Selick continued, “With this workforce reduction, we will focus our efforts on the ongoing Phase 2 clinical trials of tarloxotinib while evaluating potential further development of evofosfamide and other strategic options for the company. We plan to provide additional guidance in the first quarter of 2016.”
Threshold has a global license and co-development agreement for evofosfamide with Merck KGaA, Darmstadt, Germany. Both companies are evaluating next steps for the evofosfamide program. (Original Source)
Shares of Threshold Pharmaceuticals are up 8.89% to 0.56$ in after-hours trading. THLD has a 1-year high of $5.28 and a 1-year low of $0.45. The stock’s 50-day moving average is $3.07 and its 200-day moving average is $3.91.
On the ratings front, Threshold has been the subject of a number of recent research reports. In a report issued on December 7, Stifel Nicolaus analyst Thomas Shrader downgraded THLD to Hold. Separately, on the same day, Piper Jaffray’s Charles Duncan downgraded the stock to Hold .
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Thomas Shrader and Charles Duncan have a total average return of -4.6% and 5.7% respectively. Shrader has a success rate of 40.7% and is ranked #2967 out of 3643 analysts, while Duncan has a success rate of 43.2% and is ranked #706.
Threshold Pharmaceuticals Inc is a biotechnology company. It is engaged in discovery and development of drugs targeting the microenvironment of solid tumors as novel treatments for patients living with cancer.