In a move to cut costs, Peregrine Pharmaceuticals has reduced its overall workforce by 60 employees (or 20%). The company says it expects the workforce reductions to result in a net cost savings of between $3.7 million and $4.3 million in fiscal year 2018 and more than $7 million in reduced annualized operating expenses beginning in fiscal year 2019.

As part of the cost saving initiatives, the company reduced Peregrine’s R&D personnel by 50% to 11 employees, with the remaining staff supporting potential strategic alternatives for its R&D assets while continuing to assist with collaborative trials, the antibody discovery platform, and the exosome program. Personnel supporting the Avid Bioservices CDMO business, a wholly owned subsidiary of Peregrine Pharmaceuticals, was reduced by 20% to 184 employees to align operations with the reduction in forecasted revenues. In addition, selling, general and administrative (SG&A) personnel was reduced by 8% to 49 employees as the company continues to pursue leaner support operations.

“While this was a difficult decision, our board and management team believe it was a necessary step as we continue to evaluate strategic options to further strengthen our two distinct businesses and seek to maximize shareholder value,” said Steven King, president, chief executive officer and director of Peregrine and president of Avid Bioservices.  “I would like to personally express my appreciation to the affected employees for their commitment and meaningful contributions to the Peregrine and Avid businesses. We remain committed to capitalizing on long-term opportunities available to our CDMO business and pursuing the best path forward for our R&D business.”

Last month, Peregrine announced that as part of its strategic review it intends to expand its board of directors to add new members with CDMO and biologics experience and to commence a search for a dedicated president to head its Avid CDMO business.