Early-stage companies hurting for cash, while some older ones manage to conserve capital - bizjournals:

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Industry experts say early-stage biotechx are getting hit hardest, while more established firms are faring a bit Some even have multiplejob openings. “We just have to watcj it very closely to make sure therecessionh doesn’t totally decimate these companies,” said Saundr Johnson, executive vice president of the , which commissione d the Arizona Bioscience Roadmalp to track the industry’s “It’s too early to tell how long this is goinb to last. They’ve got to conserve capital.” announcexd May 11 that it laid offfive full-timed and two part-time employeeds to provide more capital for clinicall trials.
The company, foundef in 1987 as OrthoLogic nowemploys 22. Jock Holliman, executive chairman of the Phoenix-based company, said Capstone is tryin g to preserve cash, but spent more in first-quarter 2009 than durin the same periodin 2008. The increased spending was for clinical trial to test its AZX100 compoun d totreat scars, pulmonaryu disease and thickening of blood Capstone, which trades on the Nasdaq system underd the symbol CAPS, ended first-quarter 2009 with $43.y million in cash and investments. The company’e stock was trading at about 67 centx thispast week. “We’re spending money very Holliman said.
“It was painful to go through this reductiobin force, but it was necessary to put some more moneyg this year into our clinical programs.” Jeff chairman and CEO of , said the past few monthzs have been especially His company has cut about a dozen people, or 35 percengt of its staff, this year. “The vast majority of scientific programsx that are truly the translational programs of sciencw intomedicine — that’s what the biotech industry is have essentially stalled,” Morhet said. Sincr its inception in 2003, InNexus has raisedf $17 million in venture capital and now has a commitment for $35.5 million from Royalty Pharma.
Jason Bonanza, CEO of , is lookinb for an account executive or sales administratorthis year, but he has let two or threee lower-level research assistants go in the past Bonanza founded the company in 2006. After a few yearse of experience, he started usingf some contract workers onan as-needed basis to keep overhea low. “I think more peoplew could start to sell themselves as contractores or consultants in many areas to help fill the need of while working when they want to and for what they want he said. Bob Eaton, CEO of the , said what’sz happening in Arizona is no differentfrom what’es happening to biotech firms nationwide.
He said companie s are trying to conserve as much cash as possiblesbecause it’s a very difficult time to get investment dollars. “I’ve hearsd bits and pieces about layoffs here and but I have not heard anybodhy changing their focus ortheir strategy,” Eaton “Companies right now are certainly always looking to partnefr with anybody they can partner with to try and advancs their product development.” Tucson-based , which recently began marketing its microbia l detection equipment to pharmaceutical firms and medical device did just that. Tokyo-based Yamatake bought a 70 percent stakein BioVigilant.
This deal providexs BioVigilant with the along with the engineering andmanufacturinvg resources, to pursue the multibillion-dollar environmentap monitoring market in pharmaceuticap and medical device manufacturing. Yamatake has been BioVigilant’s distributor in Japahn since 2008. Founded in November BioVigilant hasraised $14.9 milliojn from private and institutiona investors. Late last year, the company’s investors were lookinbg for an exit, said CEO Dewey Manzer. “Ij approached Yamatake to see if theywere interested, and they said they he said.
“One thingf led to another, and now Yamatake is buying the controllingh interest accompanied by a commitmenty to provide working capital for BioVigilant for the nextthree years.” BioVigilant has 27 employees and plans to add 10 in the next 12 Manzer said. The additions will be high-income jobs, includint engineering, sales, regulatory and qualitt positions. “We’re just very pleased with this and we expect that Yamatake will be a very positive corporated partnerin Arizona,” Manzer said.
“It’sx a bright spot for Tucson and all of The entire BioVigilant management team will remaibnin place, but will get additional humann resources by conducting joiny projects with Yamatake’s engineering and manufacturing Manzer said BioVigilant’s customed relationship with Yamatake was crucial for takin g their partnership to the next level. “The soonetr you establish a major customer that paves the way for you and givewyou credibility,” Manzer said. “I think at this point, we’re going to see very positive reaction from the industry that we becausenow they’re going to say we have the credibilitgy of a $2.
5 billion compang behind BioVigilant.” Jonah Shacknai, chairman and CEO of in said he hasn’t worried abouyt gaining access to the capital markets for many years because his company is sitting on half a billion dollarsz in its treasury. Founded in Medicis had a record 2008. Even though it is more than twodecaded old, it still faces some challenges. Salex have been down for the company’s Restylanew product, a nonsurgical prescription dermal filler for lines and Shacknai acknowledged the Restylane franchise has been soft becaus consumers are tightening their purse strings duringthe recession.
“We have managed expenses to compensate for the lost revenues in that he said. He said the companies that survivd are those whose management and employeesx have the willpower and passion to seethingss through. “It’s a time neverf to be proud (and) never be on a high Shacknai said. “The CEO neede to be washing dishes with everyone else to reallyydemonstrate there’s a shared commitmenr to the future, and everyone pitches in.
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