UPDATE 1-ALexza cuts jobs, has sufficient cash till Q2 2010

Jan 29 (Reuters) - Alexza Pharmaceuticals Inc (ALXA.O) said it will cut about 33 percent of its workforce, and has cash resources to maintain its currently planned operations into the second quarter of 2010.

The company also agreed to terminate a development agreement with Endo Pharmaceuticals Inc (ENDP.O) for pain drug AZ-003, and said it does not intend to commit additional resources to AZ-003 during 2009.

The company said it will focus its resources on AZ-004, which is in late-stage development for the acute treatment of agitation in patients with schizophrenia or bipolar disorder.

With the workforce reduction of 52 employees, Alexza expects to cut expenses by about $21.5 million, net of severance costs, for 2009, and by about $11.1 million for the 2010 financial year.

As of Sept. 30, 2008, Alexza had $78.0 million in cash and investments.

Alexza shares closed at $2.88 Thursday on Nasdaq. (Reporting by Jennifer Robin Raj in Bangalore; Editing by Pratish Narayanan)