Premier Laser in Bankruptcy, Will Sell All Assets
Premier Laser Systems Inc., which recently shut down operations and laid off most of its 80 workers, filed for bankruptcy reorganization Friday as executives prepared to sell off various company assets.
Chief Executive Michael J. Quinn, who had joined the Irvine company three months ago to launch a recovery effort, said he has put the company on the block.
“I thought I would be able to fix this thing and live happily ever after,” he said. “Unfortunately, the circumstances were beyond my control.”
Quinn, a health industry veteran who helped steer Imagyn Medical Technologies in Irvine out of bankruptcy, said four companies have made offers to buy all or part Premier Laser but that he rejected the bids as too low.
Quinn said he would consider selling the entire business, Premier’s dental or vision divisions separately, or the company’s 75 patents and other technology.
To raise cash, Premier on Friday sold the rights to ophthalmological diagnostic technology to a Florida firm for $4 million. Part of the proceeds will go toward paying two lenders, Quinn said.
A week ago, Premier said it had only $200,000 in cash.
Regardless of the outcome, Quinn said he doubts Premier will continue to exist in its present form. “I think it would be in the interest of everybody involved if the name Premier floated off into the sunset,” Quinn said. “It has a stigma attached to it and never lived up to its expectations.”
In 1997, Premier became a Wall Street favorite after it received approval from the Food and Drug Administration to market a laser that could be used directly on teeth to treat tooth decay. Premier’s stock traded as high as $14 a share but spiraled downward when dentists failed to embrace the new technology. Supplier problems also plagued the company’s efforts.
The company has lost more than $100 million since its founding in 1991 and never had a successful commercial product, Quinn said.
Bankruptcy reorganization represents Premier’s best chance for attracting buyers or partners, Quinn said. Chapter 11 “gives us the opportunity to talk to investors on a better and cleaner playing field, because they don’t have to worry about lawsuits against the company or employees trying to sue us.”
Premier founder Colette Cozean, who was ousted as chairwoman, has filed a lawsuit alleging that Premier failed to pay her certain benefits and salary. The bankruptcy petition lists her as one of the company’s creditors.
Competitor Biolase Technology of San Clemente recently sued Premier, alleging that several of Premier’s products using lasers with water for dental procedures infringed on one or more of Biolase’s patents.
Premier now has six employees on the payroll, Quinn said. Two weeks ago, the company ended its relationship with turnaround specialist Crossroads Capital Partners in Newport Beach.
Quinn joined Premier in late November. At the time of his appointment, analysts said his sales and marketing savvy, combined with Cozean’s technical background, would help the company get back on track.
It was not to be. Cozean, who relinquished her chief executive and president positions in November, was replaced in early January as chairwoman and removed as chief technology officer. She later resigned from the board.
