UPDATE 1-Idenix to stop selling hepatitis B drug; cuts 100 jobs

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Sept 28 (Reuters) - Idenix Pharmaceuticals Inc (IDIX.O) said it will cut about a third of its workforce and stop developing and commercializing hepatitis B drug, Tyzeka/Sebivo, as it tries to focus its resources on its hepatitis C and HIV programs.

The company said it also amended its collaboration agreement with Swiss drugmaker Novartis AG (NOVN.VX) related to the drug.

Novartis, which owns 56 percent of Idenix, will have full responsibility for ongoing and future clinical trials and regulatory filings related to Tyzeka/Sebivo, the company said in a statement.

Shares of Cambridge, Massachusetts-based Idenix fell more than 7 percent to $2.80 in morning trade, making them one of the top percentage losers on the Nasdaq.

Idenix said it is reducing its workforce by 100 positions, the majority of which support the development and commercialization of the drug in the United States and Europe.

Following this reduction, the company said it will have about 200 employees.

The biotechnology company will incur between $5 million and $10 million in charges, and expects the restructuring to result in savings of $40 million to $45 million annually.

The company expects cash burn rate to reduce by about 40 percent to 50 percent following the restructuring.

It also expects to end 2007 with cash, cash equivalents and marketable securities of about $100 million to $110 million.

Idenix, which is engaged in the discovery and development of drugs for the treatment of human viral and other infectious diseases, said it will receive a royalty on worldwide product sales of Tyzeka/Sebivo. (Reporting by Avishek Mishra and Dhanya Skariachan in Bangalore)