Cue Health to cease operations, lay off all employees

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Following a series of layoffs and a warning from the U.S. Food and Drug Administration (FDA) to discontinue use of its COVID-19 diagnostic test, Cue Health will shut down its operations and lay off its remaining staff this week.

The layoffs involve all of Cue's U.S. employees, including its upper management, according to reports. CEO Ayub Khattak resigned in March; chief financial officer Aasim Javed tendered his resignation this month.

At the beginning of May, the company had filed a form with the U.S. Securities and Exchange Commission (SEC) saying it intended to cut 230 jobs -- 49% of its workforce -- as part of its cost-restructuring plan.

Cue received FDA de novo clearance for its COVID-19 test in 2023; with the COVID-19 testing market stagnating, the company saw its sales plummet. The company implemented restructuring plans, including waves of job cuts.

On May 13, the FDA issued a warning to consumers and healthcare providers not to use Cue Health's COVID-19 over-the-counter and point-of-care tests. In a letter to the company, the FDA said that because Cue had made changes to the tests without the FDA's authorization and changed the quality measures being used, the agency was concerned there could be an increase in false-positive results. The FDA instructed consumers and providers to throw away all unused Cue Health tests.

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