This story has been updated from a previous version.
NEW YORK, Oct. 3 – Beleaguered microarray and proteomics company Genomic Solutions announced Wednesday that it had sold off its proteomics contract services business to a newly formed company, Proteomic Research Services, in an effort to trim costs.
"This action will significantly reduce our cost structure with minimal lost revenue impact," Jeffrey Williams, CEO of Genomics Solutions, said in a statement. "Our 2000 revenue associated with proteomic contract services was less than 5% of sales."
The Ann Arbor, Mich.-based company had revenues of about $19 million last year.
Genomic Solutions sold some of its proteomic research assets to PRS, which is headed by former Genomic Solutions employees. Genomic Solutions will retain a minority interest in PRS and will also continue to partner with the new company.
Kathleen Murphy, vice president of corporate communications at Genomic Solutions, said the company could not disclose the size of the stake it would retain in PRS or the amount of money it received for the assets.
Last month Genomic Solutions announced that it intended to either sell the unit outright or to maintain a minority stake in a newly formed company as part of an overall restructuring plan designed to lead the company to profitability by the first quarter of 2002.
At the time of the announcement, Genomic Solutions said it would trim its overall workforce of 170 people by 25 percent. The company also decided to close a research and development and manufacturing facility in Lansing, Mich.
Genomic Solutions is now planning to focus its proteomics efforts on developing proteomic products that can be commercialized.
“We felt that based on our expertise it would be better if we focused proteomics R&D on systems, including instruments, consumables, and software,” Murphy said.
Murphy said, however, that company would continue to operate its genomic contract services business.
“That kind of microarray research is not as complex and long-term as proteomics research,” Murphy said.
The announcement helped boost Genomic Solutions share price, which closed up 27 cents, or 16.6 percent, at $1.90 in trading on the Nasdaq on Wednesday.