Progenics cuts jobs, replaces CFO

Thu Sep 20, 2012 5:29pm EDT

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(Reuters) - Progenics Pharmaceuticals Inc cut 26 percent of its workforce and replaced its chief financial officer to focus on its cancer programs after U.S. health regulators did not approve its constipation drug for use in a wider population.

Chief Financial Officer Robert McKinney and Senior Vice President Benedict Osorio will step down on September 30. Treasurer Angelo Lovallo will become principal financial officer and principal accounting officer, Progenics said.

Progenics's only marketable injection, Relistor, treats opioid-induced constipation in patients with advanced illnesses.

The company licensed Relistor to Morrisville, North Carolina-based Salix Pharmaceuticals Inc last April. Both companies have been trying to get Relistor approved in the United States to treat opioid-induced constipation in adults with chronic, non-cancer pain.

U.S. health regulators denied in July approval to Relistor for use in this wider population asking the companies to provide more data. If approved, Progenics would be entitled to a $40 million milestone payment from Salix.

Progenics said on Thursday it is terminating several early-stage research projects, but did not list them.

Progenics, which has 77 employees after the job cuts, expects to reduce about $8 million in annual cash expenditures after accounting for the restructuring costs.

Global net sales of Relistor for April-June more than doubled to $10.8 million, but were down 12 percent from the previous quarter.

New York-based Progenics had cash, cash equivalents and securities of $51.1 million on June 30.

The company dropped its virology and infectious diseases programs and cut about 26 percent of its workforce in September 2011 to reduce costs and focus on its cancer treatments.

Progenics's shares closed at $3.46 on Thursday on the Nasdaq. The stock is down 36 percent since FDA's rebuff in July.

(Reporting By Pallavi Ail and Zeba Siddiqui in Bangalore; Editing by Don Sebastian)

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