54gene CEO steps down as the company looks to cut more jobs • TechCrunch
54gene Co-Founder and CEO Dr.. Abbasi In-Obong The African genome company confirmed to TechCrunch today, that he has resigned from his executive position.
The three-year-old company has appointed a general counsel Teresa L. Post as interim CEO. It will be supported by the Chief Operating Officer Denote AtiboThe company said. On the other hand, Ene-Obong will retain his position on the 54gene board as he transitions to a new position of senior advisor.
In-Obong’s resignation and post’s inauguration come after two months 54 Jin 95 employees laid off, or more than 30% of its workforce, in August. The layoffs have affected employees, most of whom are contract employees (in laboratories and sales departments) assigned to work on 54gene’s COVID business line launched in 2020 to complement its flagship product: an African Genome Biobank.
Founded in 2019 by Ene-Obong, 54gene addresses the gap in the global genome market where Africans make up less than 3% of the genetic material used in pharmaceutical research despite being more genetically diverse than any other population group. The venture has received more than $40 million from investors such as Adjuvant Capital, Y Combinator and the Cathay AfricInvest Innovation Fund (CAIF) and has partnered with organizations such as Illumina, Genentech and Parexel.
Biotech companies globally tend to take a long-term approach to making money; In fact, these companies can still be worth billions with little or no revenue. For 54gene, which is based in Washington but focused on Africa, its primary revenue path involves working with pharmaceutical companies to develop drugs and generics — and that takes time. The typical time frame for a new drug from creation to market entry can take up to a decade, so it made sense for 54gene to shift its lab capabilities to COVID testing as a new revenue source.
However, the decline in COVID testing has presented new challenges for the 54 gen: dwindling revenue and redundant roles. Although it has already laid off 95 employees, the company has confirmed that it will conduct a second round of layoffs after restructuring across several departments. According to the YC-backed company, it wants to focus resources on its core mission of African genome research and precision medicine equivalency. At the same time, the clinical diagnostic arm takes a back seat.
Here is more information about the company’s new direction:
Going forward, the primary focus will be on the unique genomic research initiated by the company by making greater use of genomic datasets drawn from the latest 54gene Biobank, which currently includes more than 130,000 unique patient samples and corresponding genomic data, all using the objective of developing The company to make contributions to precision medicine and drug discovery. This continues the purposeful business in which the company invested, while reducing the focus on the clinical diagnostics business line at the time.
It is unclear exactly why Ene-Obong is stepping down. However, it is not inconceivable to assume that the company’s recent suffering is a contributing factor. Also, when the company carried out its first round of layoffs, allegations of financial wrongdoing were brought against him and his executives from a group of employees. But such claims are unfounded, at least for the time being. Interestingly, the resignation of the former CEO also comes one month later Ogochukwu Francis OsevoThe company’s co-founder and vice president of engineering left the company in September.
In response to whether the company’s decision to let him go was performance-related or because the former CEO was moving into new projects, only 54gene said, “Abasi has decided to step down as CEO but will continue to support the company with plans going forward such as strategic partnerships and fundraising. No We can comment on other new interests he will pursue if any, but we wish him well and still consider him a key member of the team.”
With 54gene moving to a new stage, Ene-Obong, who has advised organizations like Gilead and IMS Health in the past, believes the startup is in good hands because Bost and Attipoe “have a deep insight into 54gene’s business.” Bost has more than 20 years of extensive knowledge and experience in the pharmaceutical, biotechnology, and healthcare fields with companies such as Celgene and Quartet Health while providing strategic support for securities, corporate governance and financial matters. On the other hand, Attipoe has more than 15 years of experience in the pharmaceutical sector by working with companies like Roche and Genentech.
Addressing his departure and relocation, In-Obong said in a statement:
I have always believed that the amount of genetic diversity in Africa and other highly diverse populations will materially impact our understanding of biology and lead to better medicines and interventions for the world’s population, and I am proud of what has been achieved in 54gene. I would like to thank the 54gene Board for their support over the years, and the many talented scientists and technology professionals I have had the pleasure of working with during my time at the company. I will continue to support the company and the scientific ecosystem, particularly the African Genomics ecosystem. Teresia and Delali bring decades of experience building and expanding high-impact global pharmaceutical companies, and they also have deep insight into the 54gene business. I’m excited to see them take the company to its next stage.