Precipio Secures a short-term $500K Credit Facility
NEW HAVEN, Conn., May 06, 2024 (GLOBE NEWSWIRE) -- Specialty cancer diagnostics company Precipio, Inc. (NASDAQ:PRPO), announces it has secured a short-term loan facility of $500K to deal with any delays in cash collections due to the recent cybersecurity attack on Change Healthcare, a healthcare billing company used by a significant part of the healthcare market.
Many healthcare businesses, including Precipio's Diagnostic Services division, rely on Change Healthcare (CH) to submit bills and collect cash from various payors and insurance companies for the services they provide. CH experienced a widely publicized cybersecurity attack in early 2024 that impacted the daily flow of cash receipts to the company and, as discussed at the shareholders' call on April 1, 2024, has impacted its cash reserves.
As mentioned on the call, payments from customers of Precipio's Products division are not processed through CH and were not impacted by the cybersecurity event. Additionally, no cybersecurity attack affected Precipio's own IT infrastructure.
Under the terms of the facility, the company will draw down the first $250K immediately; and can access an additional $250K in a future time, at its discretion. The company can repay any amount of the loan at any time without prepayment penalties; and it will only pay interest on amounts actually borrowed.
"We are addressing a short-term operational situation with the appropriate financing tool to remedy the problem, and ensure the company maintains adequate operating liquidity," said Ilan Danieli, Precipio's CEO. "We believe this is a short-term situation rather than a material change to the business, and therefore we felt that a loan facility that the company can access and pay back at its discretion is a suitable vehicle. We are committed to the continued path towards profitability, and believe this is a temporary bump in that road."
About Precipio
Precipio is a healthcare biotechnology company focused on cancer diagnostics. Our mission is to address the pervasive problem of cancer misdiagnoses by developing solutions in the form of diagnostic products and services. Our products and services deliver higher accuracy, improved laboratory workflow, and ultimately better patient outcomes, which reduce healthcare expenses. Precipio develops innovative technologies in our laboratory where we design, test, validate, and use these products clinically, improving diagnostic outcomes. Precipio then commercializes these technologies as proprietary products that serve the global laboratory community and further scales Precipio's reach to eradicate misdiagnosis. For more information, please visit www.precipiodx.com.
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