AVNR News AVANIR Announces Cost Reduction Initiatives and Provides Update on Zenvia for IEED
SAN DIEGO--(BUSINESS WIRE)--AVANIR Pharmaceuticals (NASDAQ:AVNR) announced today that it has taken
several steps intended to significantly reduce ongoing operating
expenses. Effective immediately the Company has suspended all commercial
initiatives focused on Zenvia™ for the
treatment of involuntary emotional expression disorder (IEED) and has
reduced research and development expenses including placing on hold
activities associated with the selective cytokine inhibitor clinical
development program. These actions have led to a 16% reduction in the
Company’s current workforce. The Company has
implemented these changes to reduce its cash burn rate to a goal of
approximately $10 million per quarter, before estimated severance costs
of approximately $800,000.
These actions were taken following receipt of an Approvable Letter from
the U.S. Food and Drug Administration (FDA) for Zenvia. Since that time,
the Company has assembled a team of professionals dedicated to
addressing the Agency’s concerns. The Company
has added to Dr. Randall Kaye’s
responsibilities by appointing him as the new head of clinical
development. Dr. Kaye, Vice President of Medical Affairs, and his team
are dedicated to developing a comprehensive plan intended to address the
concerns expressed by the FDA in its Approvable Letter. Once prepared,
the Company will request a formal meeting with the FDA to ascertain the
appropriate next steps required to pursue marketing approval for Zenvia.
The Company currently believes that this meeting will most likely take
place within the next 60 days.
“Over the last few days we have had to take
steps to improve the cash position and reduce the cash burn rate for the
Company. The decisions we had to make were difficult but necessary.
These cost reduction actions and the recently announced financing will
provide financial flexibility for the Company while determining the
future opportunity for Zenvia,” said Eric K.
Brandt, President and Chief Executive Officer of AVANIR. “We
believe in the therapeutic potential of Zenvia to provide relief for
this unmet medical condition. I have personally had the pleasure of
talking to IEED patients and their caregivers about the life-changing
effect the drug candidate Zenvia has had on patients’
lives in our clinical trials. We will provide an update on this program
once we process the feedback from our planned meeting with the FDA.”
About Zenvia
Zenvia is a combination of two well-characterized compounds, the active
ingredient dextromethorphan, and the enzyme inhibitor quinidine, which
serves to increase the bioavailability of dextromethorphan. The
first-in-class drug candidate is believed to help regulate excitatory
neurotransmission in two ways, through presynaptic inhibition of
glutamate release via sigma-1 receptor agonist activity, and through
postsynaptic glutamate response modulation via uncompetitive,
low-affinity NMDA antagonist activity.
About AVANIR
AVANIR Pharmaceuticals is focused on developing, acquiring and
commercializing novel therapeutic products for the treatment of chronic
diseases. AVANIR’s products and product
candidates address therapeutic markets that include the central nervous
system, cardiovascular disorders, inflammation and infectious diseases.
AVANIR currently markets FazaClo®,
the only orally disintegrating formulation of clozapine for the
management of severely ill schizophrenic patients who fail to respond
adequately to standard schizophrenic drug treatments. FazaClo is also
indicated for reducing the risk of suicidal behavior in patients with
schizophrenic or schizoaffective disorder. For full prescribing
information and important safety information regarding FazaClo, please
visit www.fazaclo.com. Zenvia™,
AVANIR's lead product candidate for the treatment of involuntary
emotional expression disorder, is the subject of an approvable letter
from the FDA and future development plans for this product candidate are
under consideration. Additionally, AVANIR has initiated a Phase III
clinical trial with Zenvia as a potential treatment for patients with
painful diabetic neuropathy. AVANIR has active collaborations with two
international pharmaceutical companies: Novartis International
Pharmaceutical Ltd. for the treatment of inflammatory disease and
AstraZeneca for the treatment of cardiovascular disease. The Company's
first commercialized product, abreva®,
is marketed in North America by GlaxoSmithKline Consumer Healthcare and
is the leading over-the-counter product for the treatment of cold sores.
Further information about AVANIR can be found at www.avanir.com.
Forward-Looking Statement
Statements in this press release that are not historical facts,
including statements that are preceded by, followed by, or that include
such words as "estimate," "intend," "anticipate," "believe," "plan" or
"expect," or similar statements, are forward-looking statements that are
subject to certain risks and uncertainties that could cause actual
results to differ materially from the future results expressed or
implied by such statements. There can be no assurance that the Company
will continue the clinical development of Zenvia after meeting with the
FDA or that Zenvia will receive FDA regulatory approval. If such
regulatory approval is received, there can be no assurance that AVANIR
will be able to market Zenvia successfully. Final review decisions made
by the FDA and other regulatory agencies concerning clinical trial
results are often unpredictable and outside the influence and control of
the Company. Risks and uncertainties also include the risks set forth in
AVANIR's most recent Annual Report on Form 10-K and subsequent Quarterly
Reports on Form 10-Q, in the Company’s
Current Report on Form 8-K filed with the SEC on November 3, 2006, and
from time-to-time in other publicly available information regarding the
Company. Copies of this information are available from AVANIR upon
request. AVANIR disclaims any intent to update these forward-looking
statements.
