Ariad Pharmaceuticals said it will lay off about 40% of its U.S. staff—160 workers—a week after withdrawing its leukemia treatment Iclusig from the market, and almost a month after the company halted a Phase III trial.

The job cuts will be made across all major departments, Ariad said, as part of a cost-cutting program designed to extend its cash position. The layoffs will shrink Ariad’s workforce to about 295 employees in the United States and Europe.

The company said it would furnish additional details on Tuesday when it releases third-quarter results.

“This reduction in our workforce is a very painful and difficult action in which we are losing highly talented and dedicated employees, many of whom have worked for Ariad for a number of years, but it is a necessary step in strengthening the company financially,” Harvey J. Berger, M.D., Ariad’s chairman and CEO, said in a statement.

Ariad said it expects to complete the layoffs by the end of the year, and generate pre-tax savings of about $26 million in 2014. Restructuring charges associated with the layoffs are expected to be about $5 million in the fourth quarter of this year, the company added.

None of the jobs to be eliminated are based in Europe.

The layoffs cap a convulsive month for Ariad, which troubles beginning October 8, when the FDA placed a hold on the company’s Phase III EPIC or “Evaluation of Ponatinib vs. Imatinib in Chronic Myeloid Leukemia” trial of Iclusig for patients with newly diagnosed CML. On October 18, Ariad said it mutually agreed with the FDA to terminate the trial after patients treated with Iclusig experienced increased blood clotting.

Ariad disclosed an 11.8% rate of serious arterial thrombosis in Iculsig-treated patients after 24 months of treatment, vs. the 8% rate after 12 months disclosed on its prescribing label.

Iclusig won FDA accelerated approval for resistant or intolerant chronic myeloid leukemia and Philadelphia-chromosome positive acute lymphoblastic leukemia patients in December 2012, based on Phase II data. Ariad began marketing the $115,000-a-year drug, while continuing clinical trials designed to add indications allowing wider use of Iclusig.

Ariad has publicly discussed the possibility of changing its U.S. prescribing label to include a stronger warning—something European regulators may soon require. Earlier this month, the European Medicines Agency’s Pharmacovigilance Risk Assessment Committee (PRAC) recommended that Iclusig’s label be revised with strengthened warnings on the cardiovascular risk and guidance on optimizing the patient’s cardiovascular therapy before starting treatment.

The EMA’s Committee for Medicinal Products for Human Use (CHMP) will review the recommendation, with the agency saying in a statement that the CHMP will issue an opinion during its next meeting, set for November 18–21.

Previous articleFNIH, Geoffrey Beene Foundation Name Winner of Alzheimer’s Challenge
Next articleCancer Mutation Prediction Challenge Launched