MENLO PARK, Calif. (AP) — Geron Corp. shares tumbled 21 percent in after-hours trading Monday after the company said that it will end development of an experimental cancer drug and eliminating 43 jobs.
The company will stop working on GRN1005, a drug that was designed to deliver a chemotherapy agent to the brain to treat brain tumors. It is also terminating its licensing agreement on that drug. Geron said it decided to stop development of GRN1005 based on an unsuccessful analysis of a mid-stage clinical trial. The company also said it was unable to enroll patients in a lung cancer trial.
The company will cut 40 percent of its staff, which will leave it with 64 employees. Geron expects to have about $33 million in cash operating expenses in 2013, down from $65 million in 2012. Expenses include $3 million in restructuring costs and $3 million in costs related to the discontinuation of clinical trials. The company said it will have about $90 million in cash and investments at the end of 2012.
Geron shares rose 7 cents, or 5 percent, to close at $1.48. The stock has lost about half its value since early September on setbacks for imetelstat. In aftermarket trading Geron shares lost 31 cents, or 21 percent, to $1.17.
Geron said it will continue studying its drug imetelstat as a treatment for blood cancers and certain types of tumors. In September Geron said imetelstat would not meet its goals in studies involving breast and lung cancers.
The company said it will report promising results from a study of imetelstat on Dec. 9. Based on those results, Geron said it is studying the drug as a treatment for myelofibrosis and will conduct studies in other hematologic cancers in 2013.
The company pioneered the development of embryonic stem cell therapies and ran the first human trials of treatments based on embryonic stem cells. However in 2011 the company ended a trial of a stem cell therapy for spinal cord injuries and said it would focus on its cancer drugs.