Cell Genesys to Shutter Plant

Cell Genesys Inc., which develops cancer vaccines, said Tuesday that it was closing a San Diego plant and scaling back operations in Memphis, Tenn., to focus on vaccines for prostate cancer, leukemia and pancreatic cancer.

The restructuring would eliminate 95 jobs and reduce the company’s annual operating expenses by 15%, excluding $1.9 million in one-time costs for the job cuts, the South San Francisco-based company said. It also will discontinue its vaccine programs for lung cancer and myeloma, a cancer of the bone marrow, because competing therapies have been developed recently.

Cell Genesys, which has never made money, said it expected to end the year with about 285 employees.

“Anytime investors see the word ‘restructuring’ in a biotech company, they think it’s a disaster,” New York-based Adams Harkness analyst Joseph Pantginis said. “It’s a misperception. They’re essentially focusing their pipeline on the products they think have the most promise.”

Shares of Cell Genesys fell 71 cents to $4.79. The stock had fallen 48% in the 12 months before Tuesday.