This week's shake-up at EntreMed Inc. goes beyond a rejiggering of management. As John W. Holaday relinquished his title of chief executive officer, the company was sharply narrowing its focus to save money.

As clinical trials of its marquee drugs Angiostatin and Endostatin continue, EntreMed has signaled that it is putting further development of the two anti-cancer drugs on the back burner.

It is instead pinning its hopes on Panzem, an anti-cancer drug that is cheaper and easier make than Angiostatin and Endostatin. Since it is a pill, Panzem also is easier to take than the other drugs, both of which must be injected.

"We're going to continue Endostatin and Angiostatin in current clinical trials, but we will not be expanding them," EntreMed President Neil Campbell said yesterday.

Campbell, the company's president and chief operating officer, is - as of this week - the undisputed head of its business affairs.

The Rockville biotech announced Tuesday that Holaday had stepped aside as CEO and taken the title of chief scientific officer, a step he took after a board meeting last week.

Holaday, who had been CEO since shortly after founding the company in 1991, retains the title of chairman. Both Campbell and Holaday now report directly to the board.

"I'm running the company," Campbell said yesterday, adding that Holaday is a scientist and performs admirably in that role.

Holaday did not return calls seeking comment.

But the changes have been in the works since earlier this year, when some members of EntreMed's board became more involved in its day-to-day affairs as its cash dwindled, said a company insider who declined to be identified.

The company had $11.4 million at the end of June.

With the fall in EntreMed's stock price and in the market overall, selling more shares became an untenable option.

Simultaneously, big pharmaceutical companies were becoming more reluctant to back development of biotech drugs since Bristol-Myers Squibb got burned over a decision to co-develop the cancer drug Erbitux with ImClone Systems.

Bristol-Myers' decision was cast in doubt after the Food and Drug Administration said it wouldn't approve Erbitux without more clinical trials.

In recent weeks, EntreMed's board became even more concerned after the resignation of Edward R. Gubish as president and chief operating officer.

A former FDA employee, he had been overseeing the company's research and development efforts.

Worried that the company was financially foundering while no top executive was concentrating solely on its scientific side, EntreMed directors pressed for a solution.

Under pressure, Holaday suggested to others that he relinquish the role of CEO and become chief scientific officer, the company insider said.

Running out of cash

Holaday has stepped aside at a time when the company has only enough cash to take it "toward the end of the year" - even after cutting 60 employees, or more than half of its work force since July, Campbell acknowledged.

"The problem was we were trying to do too many things," Campbell said.

He said the company will first focus on reorganizing to concentrate on Panzem and the other, earlier-stage non-protein therapies to which EntreMed has rights.

All are known as "small-molecule" drugs. They include variations of Panzem and thalidomide, a drug that is approved for leprosy but is prescribed increasingly for cancer.

EntreMed has rights to compositional variations of the two drugs, known as analogs.

Simultaneously, Campbell must find ways to both raise and save money --- and in a hurry.

"We're looking at all options, including the capital markets and reassessing expenses," Campbell said yesterday.

Previously, Holaday and the company's vice president for finance, Steven Goldfarb, were handling contacts with investment bankers.

But some on Wall Street privately have said the two were not well received.

With his smooth delivery, Holaday was seen as too slick while Goldfarb's role was confusing to investors: He was based in New York and was not the company's chief financial officer.

EntreMed has not had a CFO for months.

Rights for sale

The company will look at ways to spend even less money while seeking cash by finding a pharmaceutical company to acquire rights to Endostatin and Angiostatin, Campbell said. The company has enough of both drugs to handle current clinical trials into 2004.

Such a licensing deal, if typically structured, should result in upfront cash and future payments to EntreMed.

It is also looking for another company willing to co-develop Panzem, which is in clinical trials as a cancer treatment, Campbell said.

All three drugs are non-toxic therapies designed to treat diseases that are characterized by abnormal blood-vessel growth.

Campbell counts 80 such ailments that fit that bill, from cancer to psoriasis.

EntreMed's shares fell 25 cents yesterday to $1.30. The company already is fighting a Nasdaq effort to delist the stock.

With yesterday's stock-price decline, EntreMed's market capitalization - a measure of its total stock value - is about $28.5 million.

The Nasdaq National Market requires a minimum market capitalization of $50 million.