Effective immediately! Get the hell out! That’s what 44 employees at EPIX Pharmaceuticals heard today — maybe not in those words, but I’m sure it felt like that.

EPIX management said the reduction in staff will cost around $600,000 in one-time severance and benefits payments and should save the company around $4.4M annually.

Math time!!

A. 44 workers

B. severance = $600,000

C. = severance/worker = B/A = $600K/44 = $13,636.36

D. Annual savings = $4.4M

E. Annual salary/worker = D/A = $4.4M/44 = $100,000

The company says the cuts are coming as a result of scrapping an R&D deal with GSK, but we think there might be a few Vasovist researchers in there too (i.e. thanks for your help, thanks again, we’re approved now, bye!!)

EPIX CFO Kim Drapkin said this:

“The decision to take this corporate action was very difficult, but our management team and the Board of Directors believe that it is in the best interest of all EPIX stakeholders.”

Tough.

EPIX is loaded with debt. These guys have about $100M in red on the balance sheet that will become due if they can’t regain listing on the NASDAQ. They have until May 11th to do so.

Other bad times for EPIX? They have about $24M in cash and are burning $10M/quarter. They just got Vasovist approved after almost 8 years of setbacks, which is where the massive debt comes from.

This one MIGHT survive, but I don’t know who will save them. Go Vasovist?

Image from hrlegalnews

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