Shares in Oxford BioMedica have fallen on the news that chief executive Mike McDonald has left the company less than two months since he assumed the position.

The company has not given any reason for the departure of Mr McDonald, who took over as chief executive from the position of chief medical officer on July 1. Oxford BioMedica added that non-executive director John Dawson will serve as acting CEO.

Mr Dawson is described by The Times as a “mergers and acquisitions specialist” as he served as chief financial officer at the US biotechnology firm Cephalon and was also head of business development in Europe. Immediately before joining Oxford BioMedica, he was at Ardana, the Scottish biotechnology firm that went into voluntary administration in July.

News of Mr McDonald’s departure came as the company posted a net loss of £1.1 million for the first half of 2008, down from a loss of £9.3 million for the like, year-earlier period. Revenues shot up to £13.4 million from £2.0 million and Oxford BioMedica ended the reporting period with cash of £27 million.

However the firm’s chairman Alan Kingsman noted that despite being in a strong financial position, “we recognise the need to prioritise our resources”. As such, a restructuring has been announced following the failure, in July, of the vaccine TroVax in the late-stage TRIST trial in renal cancer.

Prof Kingsman said that the restructuring will reduce cash burn “by concentrating on development opportunities that may provide the greatest near-term return”. As well as TroVax, the company will now focus on ProSavin for Parkinson's disease which is in Phase I/II and RetinoStat. Oxford BioMedica hopes to begin a Phase I/II trial of the latter in 2009 as a treatment for neovascular age-related macular degeneration.

The chairman noted that severance and related costs to the move will come in at less than £100,000 (around 10% of its 90-strong workforce will be cut) and the restructuring means that the company will have enough cash to fund operations through June 2010. Oxford BioMedica also said that it is looking at possible acquisitions, having itself been the subject of a recent takeover bid, which was rejected, from the USA’s GeneThera.

Prof Kingsman also expressed his confidence in TroVax, saying that a preliminary analysis suggests that the independent data safety monitoring board’s recommendation to stop further dosing in the aforementioned trial “leaves open the possibility that a positive survival advantage may be demonstrated in the overall TRIST population or in a subset of patients”. He added that “we eagerly await the maturing data and we believe they will be important in defining the clinical development and regulatory path for TroVax”.