Conformis Inc. is planning to reduce its workforce by 10% in order to streamline operations and save costs.
The Billerica, Mass.-based medical device maker said the expense reductions — which will be companywide, impacting sales and marketing, research and development, and general and administrative expenses — will help strengthen its focus on specific areas of opportunity that it believes will enable it to achieve profitability in 2021.
Conformis, which develops and sells joint replacement implants, plans to focus on new product development programs that include Conformis Hip System, iTotal G3 and cementless Press Fit knee. The company is planning to expand its distribution into other international markets to offset weak sales in Germany.
The company expects a full commercial launch of its Conformis Hip System in the second half of 2019.
Conformis said it will reduce cash usage to about $4 million per quarter in 2019 from about $10 million per quarter in 2018. The 10% reduction in workforce will cost the company about $700,000, in the form of employee severance charges and other costs, in the fourth quarter. Annual personnel expense savings are expected to be more than $4 million in 2019.
In addition, the company amended a debt agreement with Oxford Finance LLC and paid back $15 million of its $30 million debt facility by using cash on hand.