Rigel Pharmaceuticals, Inc. (RIGL) recently announced that it has reduced its work force by approximately 18% (30 positions) in order to utilize its resources more efficiently. Further, Rigel Pharma stated that most of the effected employees were from its research and development wing. As a result of this move, Rigel Pharma expects to incur a substantial one-time charge in the third quarter of 2013.
Apart from trimming its workforce, Rigel Pharma also announced certain measures regarding its pipeline development. Rigel Pharma said that it will no longer pursue the development of its candidate fostamatinib for treating rheumatoid arthritis (:RA) or lymphoma. This decision followed the unsatisfactory performance of the candidate in studies for the above indications.
We remind investors that Rigel Pharma previously developed fostamatinib with AstraZeneca (AZN). However, AstraZeneca returned the rights to fostamatinib in Jun, 2013. AstraZeneca took this decision following the below par results of the candidate in the RA indication.
The company intends to continue developing fostamatinib for treating patients suffering from immune thrombocytopenic purpura, a blood disorder. Following encouraging results of fostamatinib in this indication in a phase II study, Rigel Pharma intends to evaluate the candidate in a phase III study. Rigel Pharma will initiate the study (n~150) following discussions with regulatory authorities. The study is expected to be completed by 2015.
Rigel Pharma also announced that it will continue to develop phase II candidates R333 (discoid lupus) and R348 (dry eye). Data from the studies on R333 and R348 are expected by year end and the second quarter of 2014, respectively. Rigel Pharma expects to advance one of the two candidates into phase III development by 2014/2015.
Rigel currently carries a Zacks Rank #3 (Hold). At present, companies like Biogen Idec (BIIB) and Gilead Sciences, Inc. (GILD) look attractive with both sporting a Zacks Rank #1 (Strong Buy).
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