On July 26, 2018, Achaogen, Inc. announced a strategic update and corporate restructuring to focus resources on the successful commercialization of ZEMDRI in the United States, the filing of a Marketing Authorization Application for ZEMDRI in the European Union and continued development of C-Scape program. The company expects the restructuring to result in an elimination of approximately 80 positions, or approximately 28% of workforce. Company's commercial and medical affairs teams are excluded from the restructuring. The company estimates that it will incur a one-time employee benefits and severance charge of approximately $6.0 million in the third quarter of 2018 in connection with restructuring, of which approximately 85% is expected to result in cash expenditures. The company expects to substantially complete the restructuring by October 15, 2018. These estimates are subject to a number of assumptions, and actual results may differ.

In connection with corporate restructuring, the company announced the departures from executive management team: Kenneth Hillan, M.B., Ch.B., President, R&D, will leave the company on October 15, 2018, however he will continue to serve on our Board of Directors; Tobin Schilke, Chief Financial Officer, will leave the company on September 30, 2018; and Lee Swem, Ph.D., Chief Scientific Officer, will leave the company on September 24, 2018. Dr. Hillan, Mr. Schilke and Dr. Swem will receive certain severance payments and benefits pursuant to the terms of the Change in Control Severance Agreements previously entered into with the company. In addition, the company announced the appointments: Zeryn Sarpangal, Chief of Staff, will assume the role of Chief Financial Officer (as well as the role of Principal Financial Officer and Principal Accounting Officer) on October 1, 2018; and Liz Bhatt, Chief Business Officer, will assume the role of Chief Operating Officer on July 26, 2018 and will assume oversight of the company's technical operations in addition to her current corporate development responsibilities. The compensation for Ms. Sarpangal and Ms. Bhatt currently remains unchanged after our corporate restructuring but may be reevaluated by Board of Directors and/or Compensation Committee at a later date. Ms. Sarpangal joined Achaogen in October 2009 and has served as our Chief of Staff since January 2018. She has previously served as our Senior Vice President of Corporate and People Strategy (February 2017 to December 2017), Vice President of Human Resources and Corporate Affairs (October 2015 to January 2017), Principal Financial and Accounting Officer (December 2015 to July 2016), Senior Director of Human Resources (January 2015 to September 2015), Senior Director of Financial Planning and Analysis (May 2014 to December 2014), Senior Director of Finance & Operations (December 2010 to August 2012) and Director of Strategic Marketing (October 2009 to December 2010). She also served as a finance consultant to the Company from July 2013 to May 2014. Ms. Sarpangal has prior experience as Vice President of Finance & Operations at Identified, an HR data analytics company, as an engagement manager at McKinsey & Company. Ms. Bhatt joined Achaogen as Chief Business Officer in September 2017. Ms. Bhatt brings to Achaogen more than 20 years of experience in corporate development and strategy in the biopharmaceutical industry. Most recently, Ms. Bhatt held the positions of Vice President of Corporate Development (January 2016 to September 2017) and Senior Director of Corporate Development (May 2011 to December 2015) at Gilead Sciences, a biopharmaceutical company, where she was responsible for executing licenses, acquisitions and collaborations across all of Gilead's therapeutic areas. While at Gilead, she also led long-term global commercial and strategic planning for Gilead's antiviral and respiratory franchises. Before Gilead, Ms. Bhatt held corporate development and strategy roles at Eli Lilly and Company.