NEW YORK – SomaLogic said on Tuesday that CEO Roy Smythe is stepping down, effective immediately. He is also one of three people departing the firm's board of directors.
The changeover came as the Boulder, Colorado-based firm reported an 18 percent decrease, year over year, in fourth quarter revenues. For the three months ended Dec. 31, SomaLogic tallied revenues of $18.8 million, compared to $23.0 million in the year-ago quarter, beating the consensus Wall Street estimate of $16.6 million.
Assay services revenues were $15.7 million, down from $19.7 million a year ago, while product revenues were $2.0 million, up from $547,000 a year ago. The firm's collaboration revenues were flat at $763,000, and other revenues were $308,000, down from $2.0 million a year ago.
Adam Taich, formerly executive VP of life sciences, has been promoted to interim CEO. He will be joined on the board by new Chairman Jason Ryan, Tycho Peterson, Kathy Hibbs, and Tom Carey. Former Chairman Troy Cox will remain on the board as an independent director, while Chuck Lillis and Ted Meisel are stepping down.
The firm did not provide any explicit reasoning for the changes to its board and management. However, on a conference call with investors following the release of the financial results, Taich highlighted a few areas of the business where he and his predecessor disagreed.
For one, SomaLogic appears to no longer be seeking to spin off its diagnostics business, a move announced earlier this year. "We were going to explore options, and we did that," Taich said, adding that it was a "key differentiator for us," especially for its customers in pharma.
The firm said in a statement that it is "working with advisors to pursue offensive strategic options including transformational opportunities," but company officials did not elaborate on these.
Taich also said he plans to put more emphasis on global expansion, especially by increasing the number of authorized service sites around the globe. The firm has eight now and should have twice that many by the end of the year.
In addition, he seeks to make the firm's products easier for customers to use. "I think we were underestimating the work required to get customers up and running and confident on the platform," he said.
Key product development programs remain on track, SomaLogic officials said. The SomaScan 10,000 proteins assay is still scheduled to launch by the end of the year, and the firm's collaboration with Illumina to produce a kit for a next-generation sequencing-based readout of its proteomics assays is on track for commercialization in 2024.
That said, executives suggested that they would rein in spending and reduce the firm's cash burn rate.
SomaLogic's net loss for the quarter totaled $49.3 million, or $.26 per share, compared to a net loss of $23.3 million, or $.13 per share, in Q4 2021, missing the consensus Wall Street estimate of a loss of $.21 per share.
The firm's R&D expenses in Q4 doubled to $22.6 million from $11.2 million the year before. Its SG&A expenses rose 27 percent to $37.8 million from $29.7 million.
For full-year 2022, SomaLogic reported revenues of $97.7 million, up 20 percent from $81.6 million in the prior year, in line with its preliminary estimate and beating analysts' average estimate of $95.4 million.
The firm's assay services revenues were $63.0 million in 2022, down from $68.0 million the year before, while product revenues were $4.2 million, up from $1.3 million. Its collaboration revenues were flat at $3.1 million, while other revenues were $27.3 million, up from 9.3 million the year before.
SomaLogic's net loss for the year totaled $109.2 million, or $.59 per share, compared to a net loss of $87.5 million, or $.64 per share, in 2021, missing the consensus Wall Street estimate of a loss of $.54 per share. The number of weighted average shares of common stock used to compute net loss per share was approximately 184 million in 2022 compared to approximately 137.2 million in 2021.
The firm reported $73.4 million in R&D expenses for the year, up 69 percent from $43.5 million in 2021. Its SG&A expenses more than doubled to $156.6 million from $78.0 million in the prior year.
For 2023, SomaLogic expects total revenue in the range of $80 million to $84 million, representing 12 to 17 percent growth over 2022 revenues.
CFO Shaun Blakeman told investors that the firm plans to halve its quarterly burn rate this year, from $40 million to about $20 million.
As of Dec. 31, SomaLogic had $421.8 million in cash and cash equivalents, and $117.8 million in investments.
In Wednesday morning trading on the Nasdaq, shares of SomaLogic were down 10 percent at $2.12.