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Roswell Biotechnologies Slashes Workforce, Says Commercialization Roadmap Stays Unchanged

NEW YORK – Roswell Biotechnologies has laid off almost half of its workforce as the firm is struggling to raise new funds for the commercialization of its molecular electronics technology.

The cuts, first reported March 4 by Stat, occurred on Feb. 18, just a few months after the firm unveiled its molecular electronics chip and a few weeks after it published a paper on the technology in the Proceedings of the National Academy of Sciences.

Roswell nearly halved its workforce, from 44 to 24 employees. Cofounder and CEO Paul Mola said the layoffs were the result of difficulties raising the firm's Series C financing round.

"This was essential to align and focus our operating team on our commercialization roadmap," Mola told GenomeWeb. "This roadmap remains unchanged, which is to continue forming strategic partnerships … followed by phased commercialization for applications in basic research, drug discovery, molecular diagnostics, proteomics, and sequencing."

Cuts were "across the board," but Mola said the firm is "preserving the team that is going to help us advance these partnerships and industry collaborations."

Roswell raised $32 million in Series A financing in 2019 to support development of its chip and an undisclosed amount in a Series B round. In November, the firm took out full page ads in major newspapers across the country, including the New York Times, to announce the chip, which it envisions as a platform for interrogating binding properties of biomolecules.

Mola, who is Black, suggested race may be a factor in his struggles to secure venture capital investment. "Since the beginning of the company, we've tried to secure VC dollars," he said, however most of the company's funding has come from other sources. "I can't definitively say race is a factor, but when you look at all the factors, it’s hard to imagine it isn't. I know that I'm not in the club," he said.

The early absence of VC participation has only made it harder to court them now, he said. "Because we don't have VCs in the organization, that's showing up as a negative. VCs offer a sense of validation for new investors. They also tend to get in at the beginning rather than come in as the company ramps up for commercialization, which requires a large amount of capital. Without existing venture capital, it's all the more challenging."

"We're working through it. I believe we'll get through it, and existing investors will support us to get to where we get the next round done," Mola said.