Progenity To Close Genetics Lab To Conserve Cash
Progenity Inc. (San Diego, CA) says it will close its genetics lab in Ann Arbor, Michigan, to conserve cash and will now focus on its drug delivery technologies and therapeutics.
Progenity’s Michigan lab specializes in noninvasive prenatal testing (NIPT) to determine the risk that a baby will be born with certain genetic abnormalities. Closing this lab and laying off its 374 employees will result in about $130 million in annualized cost savings, according to Progenity.
In addition, Progenity says it’s evaluating the potential to raise capital by selling its Avero Diagnostics anatomic pathology laboratory in Texas. Avero Diagnostics is nearing operating profitability with projected revenue of $35-$40 million for 2021, according to Progenity.
The decision to restructure comes less than one year after Progenity’s IPO (see LE, July 2020).
As of March 31, 2021, Progenity had cash and cash equivalents of $65 million and had accumulated losses totaling $574 million since being formed in 2012. For the three months ended March 31, 2021, the company reported a net loss of $32 million on revenue of $24.5 million.