Cleveland BioLabs shuffled its top management Tuesday, including a change in chief executive officers at the Buffalo biotechnology company.
ir,4l,0p,150,5p Michael Fonstein, who held dual roles as both president and chief executive officer at the drug development company, stepped down as CEO, although he will remain in the president's role.
Yakov Kogan, the company's chief operating officer, was named Fonstein's interim replacement as chief executive officer.
As president, Fonstein will focus on the development of Cleveland BioLabs' Protectan drug as a treatment for radiation sickness, especially in military and homeland security situations. Fonstein also will be involved in business development efforts and the operation of the company's joint ventures in Russia, which focus on developing Cleveland BioLabs' drugs as potential cancer treatments.
"We believe that these strategic changes best leverage the talents and expertise of our executives and will optimally position the company for success," said Dr. Bernard Kasten, Cleveland BioLabs' chairman.
Kogan "has demonstrated outstanding leadership and managerial skills as chief operating officer," said Andrei Gudkov, Cleveland BioLabs' founder and its chief scientific officer. "His appointment as interim CEO will ensure progress and strategic continuity."
Gudkov said Fonstein's "creativity and proven talent as a business developer" will be best focused on the company's efforts to develop Protectan as an emergency treatment for radiation sickness on the battlefield or other situations, such as a terrorist attack or severe nuclear accident.
Dr. David C. Hohn, a Cleveland BioLabs director and the former head of Roswell Park Cancer Institute, said the board has no plans to conduct a search for a new CEO. Instead, it views Kogan's interim appointment as a bridge to his assuming the post on a permanent basis.
"This is optimizing the use of the team that we have," Hohn said. "This is a company that is expanding, that has joint ventures to manage" and drugs to develop.
Cleveland BioLabs shares have plunged since last March, when a federal agency that has been a significant funding source requested additional clarification of the path the company is taking to gain approval of its Protectan drug from the U.S. Food and Drug Administration. Company executives have met twice with FDA officials since then.
Cleveland BioLabs shares, which fell 6 cents to $3.29 Tuesday, traded as high as $9.60 in mid-March of last year, before the FDA inquiry was disclosed.
"I'm not going to comment on the stock," Hohn said. "The market has its own cycle, as does the business."
The company also continues to lose money, which is typical for a business that is still developing a product that is not yet ready for commercial sales. Cleveland BioLabs is burning through about $1.2 million to $1.4 million a month in cash, although C. Neil Lyons, who became Cleveland BioLabs' chief financial officer last year, has said the company has enough cash to fund its operations through the first quarter of next year.