Keryx Biopharmaceuticals is restructuring in an effort to reduce its cash burn rate and re-focus its development efforts. The restructuring plan, which follows the negative outcome of the company’s Phase III trial of Sulonex for the treatment of diabetic nephropathy, and subsequent decision to terminate the ongoing Phase IV trial, is intended to conserve financial resources and to focus efforts on programs and opportunities that are most likely to provide long-term shareholder value.
   
The company anticipates that the restructuring, which includes a 50% workforce reduction, will reduce its cash burn rate to approximately $10 – $15 million for the remainder of the year. The company will have approximately 25 full and part-time employees following the staff reduction.
   
The company expects to end the first quarter of 2008 with approximately $50 million of cash and cash equivalents. Expenses are expected to total approximately $17 million at the end of the first quarter and are primarily related to shutting down the Sulonex clinical program and restructuring costs.
   
Under the restructuring plan, the company plans to terminate approximately 12 of 20 early-stage clinical studies of KRX-0401 (perifosine); to continue Zerenex studies and market research; to delay a KRX-0401 Phase III trial until additional data are accumulated from on-going studies of perifosine as a treatment for various tumor types; to terminate a license agreement for KRX-0601 (UCN-01); and close the company’s San Francisco, CA and Memphis, TN offices as well as the Wisconsin manufacturing suite, which was built to support the commercialization of Sulonex.
   
In addition, the company plans to explore opportunities to monetize portions of its technology assets, which may include partnerships, strategic alliances and pursuit of creative product-specific financing alternatives.
   
Michael S. Weiss, chairman and chief executive officer, stated, “This has been a challenging process, but through these measures we believe that we have designed a strategy by which we will conserve our financial resources and strengthen our ability to execute on our goals to move our drug candidates forward, thereby better positioning the Company for future success.”