SiliconBeat

AP Pharma, the Redwood City specialty pharmaceutical company, has begun rationing its resources to ensure its survival “in response to the deterioration of the overall economic environment and the financial markets”, the company said in a release early Wednesday.

The steps include putting development activities on hold for all of its drug candidates except the one for treatment of chemotherapy-induced nausea and vomiting that recently completed its Phase 3 trial, along with a 35 percent reduction in its workforce. That translated into 18 layoffs that will cost the company an estimated $300,000 in fourth quarter charges.

“In light of the current economic uncertainties and volatile capital markets, we are taking these timely and meaningful actions to ensure the company’s ongoing viability,” said AP Pharma’s chief executive, Ronald Prentki, in a statement. “The decision to reduce our workforce was a difficult yet necessary one. On behalf of the A.P. Pharma Board of Directors, I would also like to express a sincere ‘thank you’ to our colleagues who are affected by this decision. We wish them well in their future professional endeavors.”

No word of any pay cut for Prentki, who makes $450,000 a year and has a bonus opportunity targeted at half that amount, and who also got a huge option grant when he joined the company back in July.