Item 1A. Risk Factors
Item 1A. Risk Factors
There have been no material changes to the risk factors described in our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on March 1, 2022, except for the addition of the following risk factor:
We may fail to achieve the expected cost savings and related benefits from our Restructuring and Re-alignment Plan.
In August 2022, we announced a plan of restructuring and strategic re-alignment, which includes the elimination of approximately 130 current positions, or 25% of our workforce and other cost-savings measures (Restructuring). We expect to incur expenses of approximately $7 million to $10 million related to the Restructuring, substantially all of which will be cash expenditures for severance and other costs relating to the Restructuring through the third and fourth quarter of 2022.
Overall, we expect to realize estimated annualized operating expense savings of approximately $25 million. These estimates are subject to a number of assumptions, and actual results may differ. There is no guarantee that the Restructuring will achieve its intended benefits. For example, our cost restructuring and business re-alignment efforts may not result in the anticipated savings or other economic benefits, or could result in total costs and expenses that are greater than expected, which could require us to seek potentially dilutive financing alternatives, disrupt or restrain the scope of our business activities and make it more difficult to attract and retain qualified personnel, each of which could have an adverse effect on our business. We may implement other cost savings measures as part of the Restructuring, and may incur termination and other costs in connection with such measures, which could be material. As part of the Restructuring, we are also reviewing our alternatives with respect to additional facility space that we currently lease in Bedford, Massachusetts. These alternatives may include the termination of the lease or the sub-lease of all or a portion of the leased facility. We are currently unable to estimate facility-related charges, which may be material.
We may fail to effectively execute on the Restructuring. The Restructuring may cause disruption to our business operations. For example, the Restructuring will result in the loss of a number of long-term employees, may result in the loss of institutional knowledge and expertise and the reallocation and combination of certain of roles and responsibilities across our organization, all of which could adversely affect our operations. In addition, we may not be able to effectively realize all the cost savings anticipated by the Restructuring and we may incur unanticipated charges or make cash payments that were not previously contemplated, which could result in an adverse effect on our business or results of operations. In connection with the Restructuring, we have set in motion an assay improvement program with the ultimate objective of improving our ability to manufacture and deliver high-quality assays at scale. We expect to make initial progress toward this initiative in 2022 and that the program will be completed in 2023. We may be unable to obtain the anticipated product and quality-related benefits from these efforts in the timeframe anticipated, or at all, which could have an adverse effect on our business.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Not applicable.
Item 3. Defaults Upon Senior Securities
Not applicable.
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Item 4. Mine Safety Disclosures
Not applicable.
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