Palatin Technologies announces reduction of workforce

Source: Technology Digital

Date :26/09/2007 11:32:46

Palatin Technologies, Inc. has taken steps to reduce its workforce by 30%, resulting in annual savings of $4 million.

The downsizing, which leaves the Company with 64 employees, will provide the Company with the greatest opportunity for near-term success of its priority programs. Palatin will take an estimated $500,000 charge for severance payments in the quarter ending September 30, 2007.

"Though it is regrettable to have to reduce our work force, concentrating our efforts on value drivers and matching our resources to those projects with the highest potential for near-term value is our immediate priority," states Carl Spana, Ph.D., president and chief executive officer of Palatin.

The downsizing decision follows recent responses from representatives of the U.S. Food and Drug Administration (FDA), which raised serious concerns about the acceptable benefit/risk ratio to support the progression of bremelanotide, a drug under development for male sexual dysfunction, into Phase 3 studies for erectile dysfunction as a first-line therapy in the general population.

Palatin has engaged the FDA in discussions in order to determine next steps related to the further development of bremelanotide for the treatment of male sexual dysfunction. Regarding the development of bremelanotide for the treatment of female sexual dysfunction, Palatin has completed an exploratory at-home Phase 2 clinical trial in pre- and post-menopausal women, and the Company will be releasing the results later this month.

In addition to bremelanotide, Palatin will continue to focus on its pipeline programs, primarily a collaboration with AstraZeneca for the development of compounds to treat obesity, and the advancement of a lead clinical candidate for the treatment of congestive heart failure, for which the Company anticipates an effective Investigational New Drug (IND) Application with the FDA by the end of this calendar year.