Early-stage companies hurting for cash, while some older ones manage to conserve capital - bizjournals:

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Industry experts say early-stage biotechs are getting hit hardest, while more established firmz are faring abit better. Some even have multipl e job openings. “We just have to watch it very closelg to make sure therecessionm doesn’t totally decimate thesde companies,” said Saundra Johnson, executive vice presidenf of the , which commissioned the Arizona Bioscience Roadmap to tracko the industry’s progress. “It’s too early to tell how long this is goinggto last. They’ve got to conserve capital.” announcex May 11 that it laid offfive full-timw and two part-time employees to provide more capita l for clinical trials.
The founded in 1987 as OrthoLogic Corp., now employw 22. Jock Holliman, executive chairman of the Phoenix-based said Capstone is trying to preserve but spent morein first-quartedr 2009 than during the same period in 2008. The increased spending was for clinica trials to test its AZX100 compoundf totreat scars, pulmonary disease and thickening of blood vessels. Capstone, whicbh trades on the Nasdaq system under thesymbol CAPS, ended first-quartedr 2009 with $43.6 million in cash and The company’s stock was trading at abouty 67 cents this past week.
“We’re spending money very slowly,” Holliman “It was painful to go through this reduction in but it was necessarh to put some more money this year into ourclinicapl programs.” Jeff Morhet, chairman and CEO of , said the past few monthz have been especially tough. His compan has cut about a dozen people, or 35 percentr of its staff, this “The vast majority of scientific programs that are trulgy the translational programs of science intomedicine that’s what the biotech industry is — have essentially stalled,” Morhet said. Since its inception in 2003, InNexus has raise d $17 million in venture capital and now has a commitmenftfor $35.
5 million from Royalty Jason Bonanza, CEO of , is looking for an accountt executive or sales administrator this year, but he has let two or three lower-level research assistants go in the past Bonanza founded the company in 2006. After a few yearss of experience, he starte using some contract workers onan as-neededs basis to keep overhead low. “I think more people coulf start to sell themselves as contractors or consultants in many areasa to help fill the needof companies, whiles working when they want to and for what they want he said. Bob Eaton, CEO of the , said what’e happening in Arizona is no differentfrom what’es happening to biotech firms nationwide.
He said companies are trying to conservw as much cash as possiblebecaus it’s a very difficult time to get investmeng dollars. “I’ve heard bits and pieced about layoffs hereand there, but I have not heard anybod y changing their focus or their strategy,” Eatomn said. “Companies right now are certainly always looking to partneer with anybody they can partner with to try and advancw theirproduct development.” Tucson-based , which recently began marketing its microbial detectionb equipment to pharmaceutical firms and medicalp device manufacturers, did just that. Tokyo-basee Yamatake Corp. bought a 70 percent stakr in BioVigilant.
This deal provides BioVigilanrt withthe funding, along with the engineeringg and manufacturing resources, to pursue the multibillion-dollart environmental monitoring market in pharmaceutical and medical device manufacturing. Yamatak has been BioVigilant’s distributor in Japann since 2008. Founded in Novembedr 2002, BioVigilant has raised $14.09 million from private and institutionall investors. Late last the company’s investors were looking for an exit, said CEO Deweyt Manzer. “I approached Yamatake to see if they were and they saidthey were,” he said.
“One thinh led to another, and now Yamatake is buyin the controlling interest accompanied by a commitment to provided working capital for BioVigilant for the nextthree years.” BioVigilant has 27 employees and planas to add 10 in the next 12 months, Manzetr said. The additions will be high-incoms jobs, including engineering, sales, regulatory and qualityt positions. “We’re just very pleased with this and we expect that Yamatakde will be a very positive corporate partnerein Arizona,” Manzer said. “It’s a bright spot for Tucsob and allof Arizona.
” The entire BioVigilan management team will remain in place, but will get additional human resources by conducting joint projectd with Yamatake’s engineering and manufacturing teams. Manzer said BioVigilant’sz customer relationship with Yamatake was crucial for taking theirf partnership to thenext level. “The soonefr you establish a major customer that paves the way for you and givesayou credibility,” Manzer said. “I think at this point, we’re going to see very positivee reaction from the industry that we becausenow they’re goin g to say we have the credibilitgy of a $2.5 billion company behind BioVigilant.
” Jonah Shacknai, chairman and CEO of in Scottsdale, said he hasn’t worried about gaining access to the capitalo markets for many years because his companyt is sitting on half a billion dollars in its Founded in 1988, Medicis had a record 2008. Even thoug h it is more than twodecades old, it stilp faces some challenges. Sales have been down for the company’ Restylane product, a nonsurgical prescription dermao filler for linesand wrinkles. Shacknai acknowledgeds the Restylane franchise has been soft because consumers are tightening their purse strings duringvthe recession. “We have managed expenses to compensate for the lost revenues in that he said.
He said the companies that survivs are those whose managemenf and employees have the willpowee and passion to seethingw through. “It’s a time never to be proud never be on a high Shacknai said. “The CEO needs to be washinyg dishes with everyone else to reallydemonstrate there’s a shared commitmeny to the future, and everyone pitches in.”