NEW YORK (GenomeWeb News) – Vermillion today announced a restructuring program to reduce headcount and expenses.
The Austin, Texas-based molecular diagnostics firm said that it currently has about $22.5 million in cash and intends to reduce its cash-based operating expenses in 2012 to $12 million. Cash use is expected to fall between $3 million and $4 million in the first quarter of 2012 as remaining claim activities related to its exit from Chapter 11 Bankruptcy protection conclude.
Vermillion filed for Chapter 11 in March 2009 and emerged from bankruptcy protection a year ago.
Operating activities in 2012 will focus on commercializing its OVA1 triage test for ovarian cancer, including building market awareness of OVA1, expanding payer coverage, supporting the reimbursement activities of Quest Diagnostics — Vermillion's marketing partner for the test — and growing test volumes.
Vermillion said that pipeline development during the year will concentrate on the OVA2 next-generation ovarian cancer test, as well as on Vasclir, a test for peripheral artery disease. The company also intends to further develop its IP portfolio.
Vermillion added that it is exploring partnerships for its product pipeline to accelerate development and to build up resources for its commercial efforts.
It did not provide details about its plans to reduce its head count.
"Given the short-term challenges in both our business and the industry, the company will sharpen its operational focus resulting in an extended [cash] runway," Gail Page, Vermillion's chief executive officer, said in a statement. "The company will place greater focus and priority on those activities that it can deliver upon and explore partnerships which can accelerate the development and commercialization of the oncology and cardiovascular programs."
In November, Vermillion reported revenues dropped 23 percent year over year in the third quarter. Last month, it completed its purchase of the assets of Correlogic for $435,000 in cash.