OvaScience shares lose more than half their value on news of layoffs, exit of top executives
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OvaScience Inc.’s stock price plummeted by more than half Thursday after the Waltham biotech company, which develops fertility treatments, said it would cut its nearly 100-person workforce by about 30 percent following the abrupt departure of two top executives.
The restructuring is aimed at allowing five-year-old OvaScience to stretch its cash into next year as the company scales back the rollout of its Augment treatment, limiting OvaScience’s revenue ramp-up. Augment is available at some clinics in Canada, Japan, and four other countries, but it has yet to be approved in the United States and most European countries. The treatment works to improve the health of weaker eggs fertilized with sperm.
Harald Stock, an OvaScience board member who was tapped during the summer to succeed cofounder Michelle Dipp as chief executive, will be stepping down, along with chief operating officer Paul Chapman, the company said in a statement. Both executives, who were hired to lead the global expansion of Augment, will “seek new opportunities,” the statement said.
Shares of OvaScience plunged 55.2 percent to $1.33, losing $1.64 on the Nasdaq exchange. Company officials did not respond to a request for comment.
Dipp, the company’s executive chairwoman, said in a statement that OvaScience remains confident in the potential for Augment. But she said, “The near-term financial return has not been sufficient for us to continue to invest at the levels we believe are necessary for a large commercial expansion.”
OvaScience last month widened its quarterly loss to $19.3 million for the three months ending Sept. 30, from $17.9 million in the corresponding period last year even as its sales increased to $197,ooo from $75,000 in the same period.