Genetic testing company Invitae has officially filed for Chapter 11 bankruptcy but plans to continue its operations uninterrupted. Despite facing financial challenges, the San Francisco-based company aims to use its available cash and explore potential business sales to navigate through the bankruptcy process.
Invitae is seeking approval from the U.S. Bankruptcy Court for the District of New Jersey to utilize its existing cash reserves to support its ongoing operations during the bankruptcy proceedings. According to the company’s bankruptcy petition, it reported assets ranging from $500 million to $1 billion, while its liabilities were estimated between $1 billion and $10 billion.
Ken Knight, President and CEO of Invitae, emphasized the company’s efforts over the past year and a half to strengthen its financial position by focusing on key business areas. Despite progress in achieving positive cash flow, addressing the company’s debt through the Chapter 11 process has become necessary.
The bankruptcy filing marks a significant development for Invitae, which went public in 2015 on the NASDAQ exchange. Despite experiencing growth, including acquisitions like that of health records startup Ciitizen in 2021, the company faced challenges in turning a profit. Layoffs and divestments were implemented to cut costs, but the company’s stock price continued to decline, prompting the New York Stock Exchange to consider delisting Invitae’s shares due to low trading levels.
Despite these financial setbacks, Invitae remains committed to its mission of providing genetic testing services. The bankruptcy filing represents a strategic move to address financial obligations and position the company for future growth and sustainability in the rapidly evolving healthcare industry.
