Sirtex Medical (ASX:SRX) saw shares jump today after revealing plans for a major restructuring as the company looks to cut its headcount and focus on its “profitable core business.”
The company said it underwent an “extensive review of the business” to identify where it could improve efficiencies. The review led to an initial $7 million reduction in R&D in February.
Sirtex said that as part of the restructuring, it now plans to reduce its headcount by approximately 15%, saving approximately $5.3 million.
“Sirtex’s core business, based on selective internal radiation therapy with targeted doses of SIR-Spheres Y-90 resin microspheres into the liver is clinically proven technology with regulatory approvals across key global markets, which produces positive outcomes for patients with liver cancer. Our goal is to achieve expanded use within our existing markets which covers over 40 countries globally and gaining utilization in new geographies. While the reduction in headcount across a number of business functions is regrettable, it must be noted that these structural changes in the business are designed to optimize the way we engage with our key clinician stakeholders and more effectively target new users, while ensuring as many patients receive our innovative therapy through new or expanded reimbursement,” CEO Andrew McLean said in a press release.
The company said that by focusing on its core business, it will be better positioned to “grow within its under-penetrated salvage market.”
An immediate priority under the restructuring will be finalizing submission for expanded coverage with the FDA, Sirtex said, with a slated submission date in the 1st half of 2018.
Sirtex shares jumped 17.1% yesterday, closing at AUD $15.80.