Renaissance RX, a New Orleans startup company that performs genetic testing to help tailor medications for individual patients, confirmed Monday that it has laid off staff after the federal government froze much of its funding while the government reviews a study the company was leading.
Renaissance spokeswoman Amy Dye said in a statement Monday that the company’s “policies, procedures and training are all in accordance with accepted industry standards.”
In 2014, “we restructured our company and Medicare initiated a review, which regrettably resulted in layoffs that we do not believe will continue in 2015,” she said.
Local economic development leaders and public officials have been watching closely to see what happens to Renaissance, a company that once was lauded locally as a standout among a crop of homegrown startups that local officials hope to cultivate and promote to help diversify New Orleans’ economy.
A local legal journal, The Louisiana Record, reported last month that the company was laying off staff and experiencing financial disarray after Medicare suspended funding of its main study, a 250,000-patient registry designed in part to determine whether using pharmacogenomic data results in a meaningful change of a patient’s dose regimen.
Ultimately, the company’s testing attempts to show how a patient responds to specific medicines based on his or her genetic makeup. That knowledge would allow physicians to prescribe medications and dosages that are best suited for each patient.
The Record’s report cited unnamed employees.
Last week, Tony Salters, a spokesman for Medicare, told The New Orleans Advocate that he couldn’t comment on “proprietary concerns” and said the Centers for Medicare and Medicaid Services would “not comment on provider entities, alleged suspicion of fraud or any active or ongoing investigations.”
Renaissance, which started with five employees in the New Orleans BioInnovation Center in 2012, performs pharmacogenetic testing to show how individual patients respond to specific medications based upon their genetic makeup. The company takes a swab from inside a patient’s cheek to gather the genetic information needed to evaluate whether the patient is being prescribed the right dosage of a medicine.
In September, the company said it planned to spend $8 million on a new headquarters in the Central Business District and to add 425 workers to the 80 it already had working in the city. The local investment was backed by $925,000 in grant money from the state.
The company said it would consolidate its operations into a 30,000-square-foot building at 301 St. Charles Ave. from smaller spaces at the New Orleans BioInnovation Center and offices on La Salle and Poydras streets.
Two months later, Renaissance founder Dr. Tarun Jolly announced that TPG Growth, part of the global investment firm TPG, had made “a significant investment” in the company, although terms of that deal were not disclosed.
Meanwhile, a former Renaissance interim CEO, David Guzan, filed a civil suit last month alleging that Jolly owes him potentially more than $1 million in compensation, including unpaid wages, management fees, ownership interests in companies and damages.
Follow Richard Thompson on Twitter, @rthompsonMSY.