NEW YORK (GenomeWeb News) – Complete Genomics is laying off 55 employees in order to reduce its cash burn and has hired a financial advisor to explore strategic alternatives, the company said today.
The layoffs, which will affect employees in its field service and sequencing factory, both in Mountain View, Calif., and other US locations, will be substantially completed by June 30. The company expects restructuring costs of approximately $1.5 million, mostly in termination benefits, that will be recorded this quarter.
As part of the cost-cutting measures, Complete Genomics will delay a previously planned expansion of its sequencing capacity until demand for clinical-grade human genomes increases. For now, its monthly capacity will remain about 1,000 genomes at 40x coverage or 500 genomes at 80x coverage.
Going forward, the company plans to focus on the development of clinical applications for its whole-genome sequencing service while it will continue to provide genomes to research customers.
In addition, the firm has hired Jefferies & Company as a financial advisor to assist it in reviewing strategic alternatives, which could include a merger, business combination, equity investment, or sale. As of now, it has not made a decision to enter into a transaction.
Complete Genomics' restructuring follows a 43 percent revenue drop in the first quarter, compared to the first quarter of 2011, which it attributed to production delays.
At the end of the first quarter, the company had $63.1 million in cash, cash equivalents, and short-term investments.
In Tuesday morning trade on the Nasdaq, shares of Complete Genomics were up 7 percent at $2.19.