Great Basin Scientific Inc (NASDAQ:GBSN) a popular molecular diagnostics firm reported a cost reduction and restructuring plan that is designed to put resources on areas that will help to support the revenue growth of its prevailing commercial product line. As a considerable part of the restructuring program, the company has streamlined certain administrative and manufacturing processes and will reduce almost 50 employees countrywide.
Between these changes, together with other previously executed cost declines and added efficiencies, Great Basin anticipates to eliminate between $10 million and $12 million from its cash burn of the year. The firm reported that it has notably reduced the Convertible Note for the last year to $36 million. Ryan Ashton, the CEO of Great Basin, reported that since the firm’s inception, they have focused on establishing a pipeline of molecular diagnostics offerings that offer a unique and powerful combinations of low cost, ease-of-use and menu versatility.
This investment in operations infrastructure and R&D has resulted in prevailing product menu of 4 FDA-cleared tests and also panels with 2 additional assays in the FDA’s 510(k) process. Customer anticipation to expanding menu has been promising, and they are undertaking these changes to confirm that they are well-positioned to advance the firm sustainably and aggressively.
Great Basin does not project material pre-tax charges as an outcome of the cost reduction and restructuring plan. Numerous cost reduction measures will be commenced immediately, with all measures anticipated to be substantially closed by the close of the current quarter. The firm is continuing advancement of its previously reported assays and expects to begin new clinical studies later in 2017.
Great Basin has finalized a deal with 2016 Convertible Note holders to lessen the Note’s principal amount by $35.6 million to $36.3 million due as of February 9, 2017. In lieu, the cash amount in the firm’s restricted cash account will be lowered to $21.5 million from $57 million.