On December 16, 2022 Oncocyte Corporation (Nasdaq: OCX), a precision diagnostics company, reported a reduction in force involving over 40% of Oncocyte’s workforce to realign its team towards key products that address larger markets (Press release, Oncocyte, DEC 21, 2022, View Source [SID1234625495]).
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Additionally, Oncocyte has entered into a Stock Purchase Agreement pursuant to which Oncocyte will transfer 70% of its ownership of Razor Genomics, Inc. to buyers who are leaders in the development of early stage lung cancer diagnostics and the provision of gene-expression-based prognostic tests. Oncocyte will retain a 30% stake in Razor. The transaction involves the transfer of all of the assets and liabilities related to DetermaRx. The closing of the transaction will occur at a later date, subject to the satisfaction of the closing conditions set forth in the agreement.
Additionally, the C-suite has been restructured and the positions occupied by Gisela Paulsen, President and Chief Operating Officer, and Douglas Ross, Chief Scientific Officer, will be eliminated. Oncocyte expects that Ms. Paulsen and Dr. Ross will serve as advisors during a transition phase over the next quarter.
"We expect the transfer of the Razor entity will allow us to eliminate development and commercialization costs with respect to DetermaRx while retaining 30% of any potential upside from the test, which is used to assess the risk of recurrence for patients with early-stage lung cancer," said Joshua Riggs, Oncocyte’s Interim CEO. "We believe this transaction, along with the reduction in force, will prepare us for a more focused strategy and further elongate our cash runaway as we prepare for key commercial and developmental milestones in 2023. We plan to keep shareholders updated with our enhanced focus and strategy in Q1 2023."