Sequenom, beset by meager share prices and a rapidly evolving marketplace, will lay off around 30 percent of its workforce, or 44 staffers, in a large-scale restructuring aimed at cutting costs and redirecting resources.
The step is expected to save the San Diego company between $7 million and $9 million in cash burn next year after recording a $1 million charge in severance and other costs.
Sequenom, which will receive a Nasdaq delisting warning letter tomorrow if its stock closes below $1, also said it will "consider additional steps to raise capital including accessing financial markets and advancing strategic partnerships."
"Currently, we are in the process of stabilizing the core genetic analysis business and focusing on initiatives with high growth prospects," Harry Stylli, Sequenom's new president and CEO, said in a statement today. "In parallel, Sequenom has prioritized key product and service initiatives that, in due course, are expected to drive growth and create value.
"Further, Sequenom's core technology is demonstrating emerging utility in the molecular diagnostics market," he continued. "We expect to capitalize on our promising potential in this large and fast growing market primarily through key strategic partnerships."
As part of the restructuring, Sequenom intends to focus on its flagship MassArray platform and its iPlex multiplexing assay. It also said it plans to launch several new applications for use with its MassArray system within the next year.
Specifically, the company said it plans to offer products and services for quantitative gene expression and methylation services; launch a series of applications that will "significantly" reduce cost per genotype beginning with the iPlex multiplexing assay; develop multiplexed quantitative methylation and multiplexed QGE for "fine mapping and molecular diagnostics; launch a "cost effective" MassArray product for lower-throughput users; and take advantage of internally developed biomarkers in hopes of sparking developmental partnerships.
Among other steps, Sequenom said it plans to "evaluate opportunities to license IP to more broadly enable the analysis of nucleic acids by mass spectrometry." The company's MassArray platform is based on mass spec.
In addition, Sequenom said chief financial officer Steve Zaniboni will step down during the fourth quarter because the company plans to consolidate the CFO position with that of the vice president of finance. That position is currently held by John Sharp.
Lastly, Sequenom said it has negotiated a rent deferral of approximately $3.2 million over two years for its corporate headquarters, and continues to explore subleasing options for this facility. The company is also taking steps to lower costs by reviewing its key supplier relationships.