A cancer treatment company now announces unexpected layoffs, part of a broader effort to “significantly reduce” expenses.
Dermtech will lay off about 100 employees, or 56% of its workforce, to preserve cash.
The San Diego-based company, which makes a skin patch to test for melanoma, is also exploring strategic alternatives, it said Thursday in a regulatory filing.
Strategic alternatives that may be considered include an acquisition or a sale of assets.
The staff reduction is part of a broader effort to “significantly reduce” operating expenses and maximize shareholder value, Dermtech said.
As a result of the announcement, the company said it will not hold a first-quarter earnings conference call.
Dermtech posted a net loss of $100.9 million in fiscal 2023 and reported its billable sample volumes fell 11% in the fourth quarter. It had cash and equivalents, restricted cash and short-term marketable securities of $59.3 million as of Dec. 31.
The company’s noninvasive test, which collects cellular material from the skin’s surface, is designed to detect genomic markers associated with melanoma and differentiate benign lesions from those at higher risk.
The test has a 99% negative predictive value, according to the company, which means that with a negative test result, there is a 99% probability that the lesion is not melanoma. The laboratory-developed test is not reviewed or approved by the FDA.
The company’s board of directors approved the restructuring plan on Thursday. The workforce reduction is expected to be completed by the end of the second quarter.
Dermtech will record one-time charges in the second quarter of about $1.6 million related to the job cuts, including severance payments, employee benefits, outplacement services and other costs.
A special committee of the board hired TD Cowen to conduct the strategic review process, and AlixPartners has been hired as a restructuring adviser.
On April 15, Dermtech received a written warning from Nasdaq that the company could be delisted from the stock index for falling below the required minimum of $1 per share.
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Other Economy News Today
A massive furniture store is now closing after 100 years in business with no plans to keep operations running, sources confirm.
Union Furniture Company first opened in 1912, four months after the sinking of the Titanic.
Despite shifts in ownership throughout the years, the Becker family was able to keep the store’s doors open in Macon, Georgia, just over 80 miles south of Atlanta, until recently.
Simon Becker, the grandson of the store founder and his namesake, told LOCAL CBS affiliate WMAZ that he has been with the company since 1984.
“I spent 40 years here,” Becker said.
“My father and my uncle before me, my grandfather before that.”
He revealed to the outlet that approximately nine months ago, he decided he would need to close the store.
“But I don’t have anybody following me, so it was going to happen either now or sometime in the relatively near future anyway,” Becker said.
For 112 years, the Union Furniture Company has sold couches, coffee tables, washers, and more.
Becker told the outlet that the store has had repeat customers that go back 20, 30, and even 40 years.
“We’ve had the grandchildren of people we’ve done business with, do business with,” he said.
He called the decision to close “difficult” and “very emotional”, reports The-Sun.
Becker is planning to host a closing sale at the Macon store starting on Wednesday, April 24.
Everything in store is set to be sold with discounts as high as 50% off.
Once everything is gone, Becker said the store will officially close.
He told the outlet that he and his family are grateful to the Macon community that has been their home for decades.
“So thankful to the community for everything that they’ve done for us and we’ve done for them as well,” he said.
“Providing furniture for generations of people in the Macon community.”
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Also Read: This Massive Mall Retailer Now Closes For Good
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