Cue Health gets the clue to shut down operations. It will be a Memorial Day to remember for the 480 remaining US employees of the San Diego-based company. Come Tuesday, none of them will be returning to work. The 230 scheduled earlier this month to wind up in July, plus the remaining 250, have their last day and paycheck on Friday 24 May, according to the WARN Act paperwork filed with the state of California. Notices were doled out to employees by the chief human resources office. The notice includes company leadership, presumably also including the new (since March) CEO Clint Sever. Cue has overseas operations in Hyderabad, India; it is unknown whether that will be affected.
Update 28 May: Cue Health filed for Chapter 7 today in the District of Delaware to formally wind down its business. The press release stated that the board attempted to pursue additional financing or a strategic transaction. The next steps will be a bankruptcy trustee appointment to sell the Company’s assets. This will be used to pay creditors in accordance with the provisions of the Bankruptcy Code. Release
Cue Health’s collapse follows the news on 15 May that the US Food and Drug Administration (FDA) invalidated Cue Health’s main business in Covid-19 Tests for Home and OTC Use and for the authorized lab test version, advising that the tests be tossed in the trash. Their remaining test is one for Mpox on an EUA. Two other tests developed for flu and RSV are still under FDA review. At its peak, it had over 1,500 employees and was valued at $3 billion. Undoubtedly, none of this is a surprise to Cue’s employees who’ve been hanging on. Presumably the released employees will be lucky to receive their final paychecks and can forget about severance or health insurance via COBRA since that requires an existing business. Our best wishes to all of them. San Diego Union-Tribune, Becker’s, MedTechDive
Another unsurprising layoff is that of 74 workers at Walmart Health Virtual Care located in Phoenix. Last month, Walmart announced the closing of Virtual Care along with its 51 Health Centers for primary and urgent care, having never scaled its model. The WARN Act notice was filed with Arizona on 17 May. Employees were offered severance of 90 days if they were unable to close another Walmart position. This is on top of Walmart relocating most positions, including remote, to Bentonville, with some in the San Francisco and NYC areas. Becker’s, FierceHealthcare The Health Centers are closing on 28 June per an update from Walmart. Walmart is also ending its Walmart Flex Medicare Advantage plan through UnitedHealthcare which was available solely in Georgia. There is no word about other Georgia and Florida programs in conjunction with Centene’s Ambetter and Orlando Health. TTA 30 April
Walgreens Boots Alliance (WBA) cashed in another $400 million sale of Cencora stock. The funds will be used for debt paydown and general corporate purposes. Their share of Cencora, a drug distributor formerly known as Amerisource Bergen, is now at 12% from 13% as recently as February. In that month, they sold 2% for $992 million in shares [TTA 14 Feb]. There is no change to their board representation (Ornella Barra, COO International) nor the partnership. WBA release
And to wind up with a little bit of good news, Expressable raised a $26 million Series B, for a total of $45.5 million since 2019. The virtual speech therapy provider will be using the funds for further development of their care delivery platform, expansion of their clinical network of W2-employed speech-language pathologists, and acceleration of their growth in health plans and provider partnerships. The round was led by HarbourVest Partners, with participation from Digitalis Ventures and existing investors F-Prime Capital and Lerer Hippeau. Release Hat tip to past colleague Amy VanStee, VP of content and marketing.
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