Since 2010 Enzon Pharmaceuticals, Inc. (OTC:ENZN) has been divesting itself of business units, discontinuing development of products in its pipeline, laying off approximately 80% of its workforce (ultimately), and even selling its proprietary technology - patents and all. Initially, this seemed to be an attempt to develop its two principle technologies - PEGylation and Locked Nucleic Acid (LNA) - without incurring excessive debt; it became clear, however, that its latest efforts may have been in response to pressure concerning its operations and planning.
The question now is: is there anything of value left in Enzon, and, if so, is it worth pursuing?
The Company
Enzon was founded in the early 1980s by Drs. Frank F. Davis and Abraham Abuchowski. As a researcher at Rutgers University Davis conceived of and developed the initial use of a polymer (polyethylene glycol - PEG) as a way of enhancing the efficacy of drugs; Dr. Abuchowski was, at that time, a graduate assistant to Dr. Davis, and did extensive research into the potential of PEG technology (eventually called PEGylation). (Dr. Abuchowski left Enzon in the mid-1990s and founded Prolong Pharmaceuticals, LLC, in 2002. He is currently CEO of Prolong.)
Enzon acquired the facilities and capacity to produce and commercialize pharmaceutical products for itself and other companies, income from which helped to offset costs for their research and development programs. At its peak, Enzon had three business units:
- Research and Development, which focused not only on its PEGylation technology, but also locked nucleic acid (LNA) technology to which it acquired the rights from Santaris Pharma A/S through a collaborative agreement reached by the two companies in 2006, as well as contract R&D it did for other companies;
- Production and Commercialization, through which Enzon marketed four products (Oncaspar, Adagen, DepoCyt, and
