InterMune to Fire 40% of Workers After Drug Rejected
InterMune Inc. (ITMN) said it will fire about 60 employees, or 40 percent of its workforce, to reduce costs after the U.S. Food and Drug Administration rejected the company’s lung drug earlier this month.
The firings will save the biotechnology company about $12 million a year, InterMune said today in a filing with the U.S. Securities and Exchange Commission. The Brisbane, California-based company said it expects to take a one-time charge of $2.4 million in the second quarter to pay for the cuts, which are expected to be completed by the end of June and will leave InterMune with about 85 employees.
The FDA rejected InterMune’s drug Esbiret as a treatment for idiopathic pulmonary fibrosis, a lung-scarring disorder. Analysts had forecast Esbiret would generate more than $1 billion in annual sales. The agency asked InterMune to conduct a new clinical trial to prove the medicine delays the progression of the disease, the company said in a statement on May 4.
InterMune tumbled 75 percent to $11.38 the day after the FDA rejection, the biggest drop since the company began trading on the Nasdaq Stock Market in March 2000. InterMune fell 3.5 percent to $8.57 at 5:55 p.m. New York time in extended trading after gaining 3 cents earlier today to close at $8.88.
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