Tetraphase announces corporate reorganization, CEO Guy Macdonald to leave
Tetraphase announced a corporate reorganization in order to maximize the commercial opportunity for Xerava, the company's tetracycline antibacterial indicated for the treatment of complicated intra-abdominal infections, or cIAI, in patients 18 years of age and older. This reorganization will include elimination of the company's internal research function and an exploration of out-licensing opportunities for the company's pipeline of early-stage antibiotics and oncology product candidates. As part of the reorganization, Larry Edwards, who currently serves as COO, will succeed Guy Macdonald as president and CEO following a transition period that will last through August 1. Edwards will join the Tetraphase board in August, and Macdonald will remain a director and, in addition, serve as a consultant to the company into December. In addition to the promotion of Edwards, Maria Stahl, senior VP and general counsel of Tetraphase, has been promoted to chief business officer, or CBO. In this new role, her responsibilities will include overseeing other corporate functions, including finance, business development and investor relations. The reorganization will also include the departure of Tetraphase's chief medical officer, Larry Tsai and chief scientific officer, Jacques Dumas. Tsai has been a contributor to Tetraphase's development programs. Tsai is resigning his position effective June 24. Dumas' position is being eliminated effective July 19. Dumas is expected to enter into a consulting relationship with the company in order to support the out licensing of TP-2846, the company's drug candidate for acute myeloid leukemia. Elimination of the company's research function and certain corporate support functions will result in a reduction in force of approximately 20%, or 24 employees. The company expects that the reorganization and other cost-saving efforts will result in an approximate $8.2M reduction in net cash required for operating activities on an annualized basis. Tetraphase estimates that the reorganization will be substantially completed by Q3 and that the company will incur approximately $2.4M of pre-tax charges for severance and other costs, primarily during Q2 and Q3.