Halozyme Therapeutics, Inc. (Nasdaq: HALO), a biopharmaceutical company developing and commercializing products targeting the extracellular matrix, today announced a focusing of its resources on advancing its core proprietary programs through key clinical inflection points in 2011 and 2012, and supporting strategic alliances with Roche and Baxter such as validation of Halozyme's commercial scale manufacturing process to produce kilogram quantities of enzyme. Halozyme will continue full development of its Phase 2 Ultrafast Insulin, Phase 1 PEGPH20, and preclinical HTI-501 programs, but will decrease research relating to the discovery and preclinical assessment of new compounds, resulting in a reduction in the workforce of approximately 25 percent. The company expects to incur a one-time charge in the fourth quarter related to the workforce reduction that will be mostly offset by reduced payroll expenses during the quarter. The implementation of this strategy is not expected to impact previous net cash burn guidance, and management reiterates its guidance of $40 to $45 million of net cash burn for 2010.
"A decade's worth of investment in discovery and preclinical research from 2000 to 2010 has resulted in two FDA approved products, three late stage product candidates with Roche and Baxter, and three exciting proprietary programs with best-in-class or first-in-class potential," stated Jonathan Lim, M.D., president and CEO. "This development focused strategy combined with our partners' achievement of their publicly stated launch timelines, could enable Halozyme to achieve cash flow breakeven by as early as 2013. I want to express my deepest appreciation to everyone for their hard work, passion, and commitment to help Halozyme reach this advanced stage of development."
Focusing resources on driving core programs through clinical inflection points will enable Halozyme to invest in the following compounds in parallel, while managing net cash burn:
- Ultrafast Insulin is a potential best-in-class rapid acting insulin product for the treatment of diabetes. Data from seven clinical studies to date have been supportive of an attractive product profile relative to standard of care analogs that could result in less mealtime hyperglycemia, less hypoglycemia, and the potential for improved glycemic control and HbA1c levels. Ultrafast Insulin is undergoing two Phase 2 treatment trials in Type 1 and Type 2 diabetes, with clinical data anticipated in 2011.
- PEGPH20 is a first-in-class pegylated enzyme with a unique mechanism of action that eliminates hyaluronan (HA) containing halos produced by many tumor cells to protect themselves. The product candidate has been shown preclinically to shrink such tumors and reduce their interstitial fluid pressure which can be a barrier to penetration by other anticancer agents, including chemotherapy and monoclonal antibodies. Approximately 20% to 30% of all solid tumors are HA positive, leading to a substantial potential market opportunity for Halozyme in the field of oncology alone. PEGPH20 is undergoing repeat dose safety and proof of concept trials in oncology, with clinical data anticipated in 2011.
- HTI-501 is a first-in-class injectable recombinant human enzyme that has been shown preclinically to locally break down the collagen fibrils that can cause disfiguring scars, contractures and cellulite. If this unique mechanism of action is successfully recapitulated in the clinic, HTI-501 could represent another potential blockbuster opportunity for the company. HTI-501 will undergo ex-U.S. first-in-human safety and proof of mechanism studies in aesthetic medicine, with clinical data anticipated in late 2011 or early 2012.
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