NEW YORK (GenomeWeb News) – Helicos BioSciences said after the close of the market on Monday that it has cut 40 jobs this quarter as part of a consolidation and reorganization of its business.
The Cambridge, Mass.-based maker of a single-molecule sequencing platform said that around half of the company's remaining 40 employees are supported by National Institutes of Health funding for research aimed at improving its technology.
In a filing with the US Securities and Exchange Commission, Helicos said that the restructuring, including employee-related costs and other restructuring costs, will be in the range of $550,000 to $650,000. Of that total, around $550,000 is tied to employee severance benefits. It said that the restructuring payments will begin to be reflected in its second-quarter 2010 results and continue through the first quarter of 2011.
Helicos expects its restructuring plan to yield $6.8 million in annual savings, it said in the SEC filing.
Following on suggestions that it made last month in its Form 10-K, Helicos said today that it plans to shift its focus to the diagnostics market.
Ron Lowy, president and CEO of Helicos, said in a statement that the firm had "engaged a variety of consultants in the genomic research, services and diagnostics industries to evaluate available alternatives and, as a result of this evaluation, we believe that our proprietary technology is uniquely suited for the diagnostics markets.
"In particular, our technology's ability to sequence DNA and RNA directly is well positioned for applications in molecular diagnostics, as it provides a direct path from patient specimen to result, and minimizes sample preparation costs," said Lowy. "Furthermore, we believe the large opportunity for diagnostics sequencing applications is in its infancy, with relatively limited competition from major sequencing companies, which we believe are less capable for diagnostics applications."
In addition to the layoffs, Helicos noted in today's SEC filing that its board of directors had terminated the Corporate Officer Severance Plan, which was implemented on Dec. 11, 2008.
It also said that as part of the restructuring J. William Efcavitch, its chief technology officer, has transitioned into an advisory role as senior advisor to the CEO beginning on May 13, 2010. He is expected to remain with the firm on a full-time basis until June 30, 2010, but will no longer serve as an executive officer of Helicos.