(AOF) – Genomic Vision announces that it has today filed a declaration of cessation of payments with the Nanterre Commercial Court, and requested the opening of a judicial recovery procedure. The Euronext-listed biotech developing products and services for the precise characterization of DNA sequences claims that given the evolution of its stock price and the liquidity of shares on the market, it “was no longer in a position to able to cover all of its cash flow needs.
To date, Genomic Vision “reports a liability due and does not have sufficient available resources to meet it”. This will involve “evaluating all solutions to perpetuate the activity, maintaining jobs as well as seeking investors as part of a recovery plan, through continuation or a sale plan”.
The Nanterre Commercial Court will rule on this request to open a judicial recovery procedure during a hearing to be held on November 15, 2023. It “could choose to open a procedure liquidation” if he considers that the financing of an observation period is not assured.
Genomic Vision has asked Euronext to suspend its share price from November 6 before the market opens.
The company warned at the end of September that the financial resources available in the short term should only allow it to finance its activities “until the end of October 2023”.
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Biotechs put to the test
These companies are suffering from a much less favorable economic cycle, which is reflected in particular by a drop in venture capital financing of start-ups. These companies are therefore obliged to carry out layoff plans. Added to this is a much more restrictive regulatory framework. First, in the United States, measures linked to the Inflation Reduction Act (IRA) could have a strong impact on the margins of stakeholders. Indeed, from 2026, the federal Medicare program will be able to renegotiate the price of drugs marketed for nine years (chemical) or 13 years (biological), with discounts that could range from 35 to 60% for biotechs. Likewise, in Europe, with the new drug regulations presented in Brussels in April, the duration of patent protection will be reduced if the innovative treatment is not marketed in all member countries within two years.