Medical firm axes half its workforce

REGENERATIVE medicine maker Intercytex is to axe half of its workforce in a move to “reduce cash burn” at the group.

The company said following the success of phase three trials of its leading product to treat chronic wounds, it now needs fewer employees and has started consultations with its 76-strong workforce, around 60 of whom are based at its Manchester headquarters. It other employees at based at labs in Boston, USA.

Intercytex, which in the six months to June 30 made losses of £6.59m, said the move will extend the company’s existing cash resources to fund operations until around the end of 2009.

It added that in the current economic turmoil, the company will not commence any new projects. However, it is making good progress in developing a skin replacement product to teat extensive burns and loss of skin on soldiers who have been injured in battle. That project is being funded by the United States Armed Forces Institute of Regenerative Medicine (AFIRM).

Chief executive officer Nick Higgins said: “Despite the very positive progress being made on each of our clinical programmes, with the markets in their current state it has become all too evident that these restructuring actions now need to be undertaken.

“We very much regret their impact on employees, but the measures being taken will enable us to preserve the fundamental capabilities of the company and, in addition to extending our cash, will give us the time and flexibility to explore fully the optimal partnering options for our key products.”