As Grail finally leaves the Illumina nest, taking flight as a public, independent company for the first time, the cancer blood test developer said it would shed as much as 30% of its staff and narrow its focus to help it gain altitude on a single, primary objective.
Grail will now devote itself toward completing the clinical studies of its anchor product—the multi-cancer, early detection screening test Galleri—while pursuing FDA approval and then, ultimately, Medicare reimbursement coverage and a steady stream of revenue.
That means pausing R&D work on a separate liquid biopsy test designed as a diagnostic aid for clinicians, for when they need to pin down tumors hidden among patients who are already showing signs and symptoms of cancer—as well as a blood test meant to monitor previously treated patients for minimal residual disease or recurrence.
Meanwhile, the 30% reduction includes cuts to the company’s headcount in addition to a freeze on the hiring it had planned for the remainder of 2024. In a filing with the SEC, Grail said it would equate to about 350 current full-time employees.
Commercial sales and medical affairs teams will shrink as Grail limits its outreach to the most active prescribers of Galleri—which is available to the public as a lab-developed test, at a cost of about $950 a pop, with more than 215,000 sold by the end of June.
Grail will also pull back efforts in its enterprise businesses, aimed at offering tests to large employers and life insurance companies; it does, however, plan to continue its precision oncology work with biopharma developers. The changes will take effect immediately.
“We haven’t set a timeline for reinvesting in those areas at this point—the focus is to drive our MCED test through the key inflection points,” Grail CEO Bob Ragusa said on the company’s inaugural quarterly earnings call with investors.
In the split with its once-and-then-former corporate parent, Illumina was obligated to supply Grail with two-and-a-half years’ worth of operations funding—a condition of its divestiture plan with the European Union, which had blocked the DNA sequencing giant’s planned acquisition of the cancer testmaker.
That amount reportedly approached about $1 billion, give-or-take; Grail said that with its latest budget cuts, the company now aims to extend its cash runway from late 2026 through to 2028—while reducing its projected 2025 cash burn to about $325 million, as it continues its work in large clinical studies based in the U.S. and the U.K.
Grail will also be consolidating its CLIA-certified laboratories, centralizing its operations in Menlo Park, California, and Research Triangle Park, North Carolina, to solely within the latter.
At the same time, the company will continue to develop a second-generation Galleri test, with an eye on scalability. Hoping to one day provide a national cancer screening test for people ages 50 and up, Grail said it expects to drop the cost-per-test by focusing on fewer genomic markers.
“One of the benefits of being in the market has been the ability to collect a lot of real-world data, which really helped us train for the new version of the assay,” President Josh Ofman said on the earnings call. “It gives us a lot of confidence in our ability to produce a scalable version of our assay… with comparable performance to our existing assay using a smaller panel.”
“We’re working through our clinical validation plan with the FDA, and we believe we are going to be able to complete our filing in the first half of 2026—with the data from our registrational studies, including the bridging to the new version,” Ofman said.
For the second quarter of this year, Grail reported $32.0 million in revenue, including $28.2 million in screening sales, for 43% year-over-year growth. Total business expenses added up to about $252.3 million—but the company also took a $1.42 billion impairment charge, resulting from the Illumina acquisition and subsequent divestiture, dating back to August 2021.
The split has also cost Grail $21.9 million in legal and EU regulatory compliance costs during the first six months of this year.