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French drugmaker Valneva to cut 20%-25% of workforce in revamp

Biotech firm Valneva works on an inactivated whole-virus vaccine against COVID-19 in Vienna

By Dina Kartit and Valentine Baldassari

(Reuters) -French drugmaker Valneva said on Thursday it plans to reduce 20% to 25% of its existing workforce as part of a revamp strategy and an attempt to repair its balance sheet.

The group, which develops, manufactures and distributes vaccines against infectious diseases, said that post restructuring its workforce would be around 25% above pre-COVID levels.

The company expects the resizing to result in annualised savings of approximately 12 million euros ($12.04 million).

"The re-sizing of our operations will allow us to increase efficiency and focus on achieving our operational and strategic business objectives," Chief Executive Officer Thomas Lingelbach said in the earnings statement.

The firm based in southeast France also cut expenses for research and development between 95 million euros and 110 million euros against a range of 120 million to 135 million euros it previously anticipated, citing the phasing of clinical trial expenses and accelerated wind-down of COVID-vaccine-related activities.

Valneva has won regulatory approval in the European Union and some other countries for its first-generation COVID-19 vaccine, but previously said it had suspended manufacturing in light of low order levels.

The French vaccine developer maintained its total revenue forecast for 2022 between 340 million euros and 360 million euros.

End-September revenue amounted to 249.9 million euros, climbing 257.8% from a year earlier, and product sales, including Covid-19 vaccine sales, were 63.7% up year-on-year, at 74.4 million euros.

($1 = 0.9968 euros)

(Reporting by Dina Kartit and Valentine Baldassari; Editing by Muralikumar Anantharaman and Sherry Jacob-Phillips)