Cortex announces corporate restructuring, workforce reduction
IRVINE, Calif. Cortex Pharmaceuticals announced a significant restructuring of its organization which involved a reduction of personnel by approximately 50%.
The workforce reduction is in addition to other capital preserving initiatives, including the reduction of salaries for the company’s executive officers.
The company said the initiatives are steps to reduce its monthly spending requirements, and align its current resources with its strongest near-term opportunities.
Cortex will focus its efforts on the development of its clinical programs. At the same time, it has significantly reduced basic research efforts in early, non-clinical stage programs.
“This restructuring is an absolute necessity in the light of the current financial climate,” said Mark Varney, Ph.D., president and CEO, Cortex. “I would like to express my gratitude for the contributions and commitment of our outstanding employees who were impacted by the workforce reduction. However, we need to ensure that Cortex can continue to advance its promising pipeline compounds. In the near term, these programs have the potential to address three very large markets of ADHD, sleep apnea and respiratory depression. Obviously, over the longer term we plan to continue to develop additional applications in Alzheimer’s disease, Parkinson’s disease, and other neurodegenerative disorders.”
Currently, Cortex has four programs in clinical or preclinical development representing diverse chemical structures and market opportunities. These programs include:
- CX717: one of Cortex’s Low Impact Ampakine drugs that achieved proof-of-concept in opioid-induced respiratory depression. Current efforts are focused on the development of an intravenous dosage form of CX717.
- CX1739: an Ampakine compound that is currently in a Phase II sleep apnea study, with expected completion around mid-2009. A Phase II study in ADHD in adult patients is planned to be initiated around mid-year in the United States.
- CX1942: a unique Ampakine pro-drug with enhanced water solubility which is approximately 5-6 times as potent as CX717 and has potential in both i.v. and oral respiratory depression applications and sleep apnea. Cortex plans to advance the compound into toxicology and Phase I clinical trials over the next year, when additional capital becomes available.
- CX2007: A compound in a new chemistry space, with a longer half-life than other compounds that will be advanced for the treatment of ADHD and Alzheimer’s disease, when additional capital becomes available.
“Given the current state of the capital markets, we will continue to evaluate all options for raising cash, including licensing, partnering, and other strategic options,” Varney said. “Cortex is currently working diligently to secure several out-licensing and partnering opportunities, which if and when completed, will provide a significant infusion of capital.”
Drug Fair files Chapter 11; Walgreens to buy the stores
SOMERSET, N.J. Another regional player has fallen by the wayside, as Drug Fair files for Chapter 11 and enters an agreement to sell substantially all of its assets associated with 32 stores to Walgreens.
Prior to the bankruptcy filing, Drug Fair sold various assets at 13 locations to third parties, including Walgreens, which purchased prescription files from 11 Drug Fair locations that are closing. Patients previously served by these 11 pharmacies now have access to their prescription histories at any nearby Walgreens.
“Drug Fair has been a respected pharmacy in this region for more than 50 years,” stated Walgreens market VP for the Northeast, Tim Anhorn. “We’re pleased to be able to keep most of the stores open and continue providing these communities with convenient access to high quality pharmacy services and basic needs. Customers will continue to see many of the familiar faces behind the counter they trust for their healthcare needs.”
It is unclear when the acquisition will be finalized but, during the transition period, the day-to-day operations are expected to be uninterrupted at the locations that are to be sold as part of the proposed transaction with Walgreens.
In connection with the Chapter 11 filing, Drug Fair has arranged a four-month secured debtor-in-possession financing in the amount of $40 million. If approved by the court, proceeds from the DIP financing will be used by Drug Fair to fund its operations during the Chapter 11 proceedings and should enable it to continue to satisfy its obligations associated with its remaining operations, including payment of employee wages and benefits and post-petition obligations to vendors.
In a March 17 memo, Drug Fair president, CEO Tim LaBeau sent to associates, he wrote, “These challenging economic times have affected all of our families, our friends and our patients in some manner. As you have been well aware, our company too has been struggling to maintain its viability. To this end, rather than close our doors like others, we decided to initiate a process to find a buyer for our business who is in a better position to continue the Drug Fair legacy.”
As previously reported by Drug Store News, the two stores in Rockaway and Raritan Borough in New Jersey have already closed. The sign at the Raritan Borough store directs pharmacy patients to a nearby Wegman’s, which, according to local news reports, has acquired the prescription files from that location. The sign at the Rockaway store reportedly directs pharmacy patients to a nearby ShopRite.
U.N. calls for coordinated global approach to runaway market for Internet drug sales
VIENNA The United Nations is weighing more forcefully into the tangled web of the Internet-based prescription drug market.
On Tuesday, the agency’s International Narcotics Control Board unveiled a set of guidelines on how governments around the world can better regulate Internet drug sales, according to a report from Reuters.
The move comes amid an explosion in the growth of illegitimate, web-driven drug sales, and the need for a more integrated, global solution to the problem, according to the head of the Narcotics Control Board, Hamid Ghodse.
Addressing a U.N. conference here on anti-drug efforts here, Ghodse called for a more coordinated strategy among governments to deal with unregulated Internet drug sales, Reuters reported.