CytRx puts idle assets to use

In a move to manage its risk profile, CytRx Corp. (CYTR) established Proceutics Inc., a preclinical research organization that will use CYTR's preclinical facilities to generate revenues. Proceutics will provide pharmaceutical development services to supplement the pre-IND activities of certain compounds.

The Atlanta company, which is focused on vascular and infectious diseases and cancer, decided to create the subsidiary when most of its projects began to move into the clinic, which left the company with a state-of-the-art facility for preclinical formulations work, but essentially no new preclinical candidates. "A lot of our projects were at the tail end of preclinical work, and we didn't have the resources to start a fresh pipeline," said CFO James Yahres. "So we could look at the facility as either a cash drain or a great opportunity."...