Shares in Genmab have fallen to a four-year low after the Danish biotechnology firm announced plans to cut 300 jobs and lowered its 2009 earnings guidance as a result of restructuring costs.

The company said it is planning to “reorganise to build a sustainable business that will match resources with workload now and in the future”. It is therefore selling a manufacturing facility in Minnesota, USA and reduce headcount by 300 jobs. The facility, “which is ready for sale”, will operate on “a maintenance-only mode with a small staff” until a deal is agreed.

The plant, based in Brooklyn Park, was bought from the USA’s PDL BioPharma for $240 million in February last year but Genmab says that given the environment, now its “fair value”, less the cost of selling the facility, is about $145 million and the company will recognise a non-cash impairment charge of about $83 million in the fourth quarter related to the sale.

Genmab is reducing staff across its international locations in an effort to “work in as cost effective a manner as possible”. Specifically, the Copenhagen-based firm said that the workload for development employees, in particular, has decreased “and is expected to remain low as partners take on increasing responsibility for upcoming studies”.

As part of the strategy “to build a more flexible model”, Genmab is going to work with contract manufacturers as it anticipates “limited short-term internal demand”. The company did note, however, that it does not intend to discontinue any of its ongoing development programmes and is looking forward to data from a study of zalutumumab, an antibody in late-stage development for head and neck cancer. The findings are now expected in 2010, “as overall patient survival is longer than anticipated”.

Chief executive Lisa Drakeman said “it is vital that we refocus our energies on what Genmab is best at and what the pharmaceutical industry needs most – innovation". She added that “the challenging demands on our industry require Genmab to take a hard look at our organisation and continue to prioritise spending”.

The restructuring is estimated to yield savings of 300 million Danish kroner (about $60 million). However, costs associated with the move mean that Genmab now expects to report a full-year operating loss of 1.16 billion kroner, compared to its previous guidance of a 650 million kroner loss.

The move comes less than a month after the US Food and Drug Administration approved Arzerra (ofatumumab) for chronic lymphocytic leukaemia as a treatment for patients who have not responded to Genzyme Corp’s Campath (alemtuzumab) or the chemotherapy fludarabine. The drug was developed with GlaxoSmithKline.