Sema4 cuts 500 jobs, closes Stamford laboratory
The biotech company Sema4 (NASDAQ:SMFR) has announced it is laying off 500 employees and closing the 70,000-square-foot laboratory in Stamford that it opened less than two years ago.
CEO Katherine Stueland revealed the company”™s plans during Monday”™s third quarter earnings conference call with investment analysts. A company spokesperson later confirmed that the majority of lost jobs are in Connecticut, although Sema4 will retain its Stamford headquarters.
This marks the second time in three months that Sema4 announced layoffs and a facility closure ”“ in August, the company laid off 250 workers and announced it was moving its hereditary cancer testing operations from Stamford to Gaithersburg, Maryland. At that time, company founder Eric Schadt resigned as president and chief research and development officer and also stepped down from the board of directors.
Sema4”™s shedding of Connecticut jobs and closing of its state facilities ”“ which also include the shuttering of a laboratory in Branford ”“ creates a distinctive problem because the company received loans from the state”™s Department of Economic and Community Development (DECD) that were tied to the company”™s ability to maintain state-based jobs and operations over a specific time period, with penalties incurred if it fails to main the job level and/or relocates operations to another state.
According to CTMirror, Sema4 received $9.5 million in 2015 when it was still part of the Icahn School of Medicine at Mount Sinai in New York and another $6 million in 2018. To date, state has forgiven $4.5 million of Sema4”™s loans and the company owes $11 million in principal, although it is currently making interest-only payments on the loans.
DECD Commissioner David Lehman said in an emailed statement that his office was “in the process of reviewing internally how today”™s announcement impacts the financial contract between DECD and the company.”
Connecticut Innovations, the state”™s quasi-public venture capital arm, invested roughly $2 million in Sema4 across 2019 and 2020, but the agency expressed support for Sema4”™s situation.
“We never want to see Connecticut lose jobs, but it is a challenging time in the public markets and Sema4 is making changes to become more profitable, which we understand,” said Lauren Camody, a spokesperson for the agency. “We do know our portfolio companies are actively looking to hire, and we hope the ecosystem can absorb some of this talent.”
Photo courtesy of Sema4