Opthea (ASX:OPT) has updated investors following the recent termination of its COAST (Combination of OPT-302 with Aflibercept Study) and ShORe (Study of OPT-302 in combination with Ranibizumab) Phase 3 clinical trials.
The company's board has decided to take additional steps to reduce its cost base, including reducing its workforce by approximately 65 per cent. It said a limited number of employees will remain in place to ensure compliance with the termination of clinical trial activities and to oversee administration.
“Following the negative Phase 3 trial results, and in consultation with the Company’s Development Funding Agreement (DFA) Investors, the Board has concluded that it is in the best interest of our investors to conserve cash,” said CEO Fred Guerard. “We are grateful for the numerous contributions of our colleagues leaving Opthea and wish them the best for their future endeavours.”
The company said the one-off costs associated with the reduction in force will be approximately US$4.5 million, resulting in a decrease in monthly employee costs of approximately US$1 million.
It said it remains in active negotiations with its DFA Investors and that "there remains material uncertainty as to Opthea's ability to continue as a going concern." Trading in the company's listed securities will be suspended "until Opthea is in a position to provide an announcement to the market providing more clarity on these issues and the impact on Opthea’s financial position."