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Progenics Cuts Jobs, Says CFO Mckinney Will Leave

From Associated Press (September 20, 2012)

TARRYTOWN, N.Y. -- Progenics Pharmaceuticals Inc. said Thursday it has eliminated about a quarter of its staff positions and is cutting back on research to save money.

The company terminated 27 jobs and said it will focus on an experimental prostate cancer drug while eliminating other programs.

Progenics also said Chief Financial Officer Robert McKinney and Benedict Osorio, the company’s senior vice president of quality, will leave the company Sept. 30. The moves come about two months after the Food and Drug Administration said it was not ready to grant a new marketing approval to Relistor, a constipation drug Progenics licensed to Salix Pharmaceuticals Ltd.

Progenics said now has 77 employees, down from 104. It said the cuts will reduce its annual spending by $8 million excluding severance costs.

With McKinney’s departure, Treasurer Angelo Lovallo will become Progenics’ principal financial officer and principal accounting officer.

McKinney has worked for Progenics since 1992, and he has been CFO since March 2005. Osorio has been with the company since July 2005.

Progenics said the job cuts stem from its licensing agreement with Salix and two other drug development programs it has discontinued and plans to divest.

Progenics said it will focus its resources on an upcoming mid-stage trial of its PSMA antibody drug conjugate. The trial will evaluate the drug as a treatment for prostate cancer. The company will also continue development of experimental treatments for solid tumors.

Relistor is a treatment for constipation caused by opioid pain drugs. It is currently approved in patients with advanced illnesses who are receiving palliative care. On July 27, Salix said the FDA wanted additional data about Relistor for use by adults with chronic pain that is not caused by cancer. Progenics said it will get a $40 million payment from Salix if the FDA grants the new approval.

Shares of Progenics gained a penny to $3.46 Thursday. The stock lost a penny to $3.45 in aftermarket trading.

Posted: September 2012