Targeted Genetics, a Seattle biotech company that is struggling to survive, said it has terminated a 76,000 square foot lease for a Bothell manufacturing facility that it never built or occupied. As part of the deal, the company will be released from about $12 million in payment obligations in exchange for a $500,000 termination fee.
"This settlement reduces our monthly expenses and, more importantly, enables us to record a non-cash entry that reverses approximately $7 million of restructuring charge liabilities from our balance sheet," said B.G. Susan Robinson, president and chief executive officer in a statement. "This significantly increases our net worth and removes a considerable impediment to charting our path forward."
After laying off staff, cutting executive pay and reducing other expenses, Targeted Genetics remains on the brink. And despite the renegotiated lease, the company still must raise more cash if wants to survive.
At the end of March, the company had just $3.9 million in cash and cash equivalents on the books. Its working capital balance was $185,000.
At the time, Targeted said that it only had enough cash fund operations into August.
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