San Diego's Sequenom (Nasdaq: SQNM), which scrubbed the launch of its diagnostics test for Down syndrome back in April 2009 over "mishandled data," says this week it's resuming development with a new testing schedule. Sequenom says it could launch a laboratory test "before the end of 2011" if everything goes as planned.
In announcing its financial results for the first quarter that ended March 31, Sequenom laid out a timeline that begins with the optimization of a DNA sequencing-based test to be completed by the fall of this year. By the end of 2010, the company said it expects to have collected a sufficient number of blood samples from high-risk pregnancies for its blinded clinical studies. "These blinded studies represent the pivotal validation studies to support launch of a noninvasive T21 test," the company says, using shorthand for Trisomy 21, the scientific name for Down syndrome.
In a surprise announcement last April 29, Sequenom postponed the long-anticipated debut of its flagship Trisomy-21 test, which screened a blood sample drawn from a pregnant mom for fetal DNA linked to Down syndrome-due to "employee mishandling of R&D test data and results." A subsequent internal investigation prompted a special committee formed by Sequenom's board to fire CEO Harry Stylli, senior vice-president of R&D Elizabeth Dragon, and three other employees. The CFO and another executive resigned.
The company, which is now headed by chairman and CEO Harry Hixson, still faces long odds on several fronts, including federal criminal and civil investigations as well as a looming shortage of cash. Sequenom did not say how much it will cost to restart development of its Down syndrome diagnostic test, but as of March 31, the company says it had total available cash and securities of $29.2 million -- with another $8.6 million due from in unpaid bills. The company says it used net cash of $13.4 million in its first quarter to support operations.
Sequenom is reporting a loss of $16.9 million, or $0.27 a share, for the first quarter of 2010. That compares with a loss of $17.5 million, or $0.29 a share, in the same period a year earlier. The company says total revenue amounted to $10.6 million in the first quarter, a 22% increase over the $8.7 million in revenue during the same quarter last year.
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Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at [email protected].
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