Accelerate Diagnostics: $718M in Losses Ends in 97-Day Credit Bid Sale

Accelerate Diagnostics spent nearly four decades developing rapid infectious disease diagnostics aimed at identifying pathogens and antibiotic resistance in hours rather than days. The Tucson, Arizona-based company developed the Accelerate Pheno system, an FDA-cleared platform that reduced time to antimicrobial susceptibility test results by more than 40 hours compared to traditional culture-based methods. Clinical studies validated its accuracy—95.6% identification rates and 96.4% agreement with conventional testing. Accelerate never achieved profitable operations. By December 2024, the company had accumulated $718.9 million in losses since inception, with revenue around $11-12 million annually while competitors introduced four new FDA-cleared rapid AST systems in a single six-month period. When Accelerate filed for chapter 11 bankruptcy on May 8, 2025, in the District of Delaware, it entered with a stalking horse bidder already in place: Indaba Capital Management, the company's largest secured creditor, would credit bid $36.9 million to acquire substantially all assets. The case moved from petition to confirmation in 97 days, and Indaba sold the acquired assets to Bruker Corporation about three months after the new company launched.

Company Background: Product Development and Commercialization

Accelerate Diagnostics' origins trace back to 1987, when the company was founded to research microbiology solutions. For its first quarter-century, the company operated as Accelr8 Technology Corporation, trading on the NYSE while pursuing various research initiatives. In late 2012, the company began trading on the Nasdaq Capital Market under the new name Accelerate Diagnostics and ticker symbol AXDX.

The Accelerate Pheno system. The Accelerate Pheno system is a fully automated test system that uses automated fluorescence in situ hybridization technology combined with morphokinetic cellular analysis to provide rapid species identification and antimicrobial susceptibility testing results. The system provides results directly from positive blood cultures within approximately seven hours—faster than traditional methods. Pathogen identification occurs within two hours, with phenotypic resistance results available after an additional four to five hours.

A multicenter evaluation published in the Journal of Clinical Microbiology found that the Accelerate Pheno system correctly identified 95.6% of organisms, with performance sensitivity and specificity of 95.6% and 99.5%, respectively. Overall category agreement between the system and culture-based AST was 96.4%, with minor, major, and very major discrepancy rates of 1.4%, 2.3%, and 1.0%, respectively. The system accurately identified 14 common bacterial pathogens and two Candida species. Another study in the same journal documented that the Pheno system reduced time to identification results by 27.49 hours and time to AST results by 40.39 hours compared to culture-based methods.

Clinical context. Sepsis—a condition caused by the body's response to infection—kills approximately 270,000 Americans annually and remains one of the leading causes of hospital mortality. When a patient presents with suspected sepsis, clinicians initiate broad-spectrum antibiotics and later narrow therapy once the causative organism and its antibiotic susceptibilities are identified. Traditional culture-based methods require 48-72 hours for this identification, during which patients may receive antibiotics that are broader than necessary or ineffective against resistant organisms. The Accelerate Pheno system can provide susceptibility data within about seven hours.

Commercial performance. Despite the technological validation, Accelerate Diagnostics never achieved profitable operations or positive cash flows since inception. The company's accumulated deficit totaled $718.9 million as of December 31, 2024. Revenue remained flat: $11.2 million in 2020, $11.8 million in 2021, $12.1 million in 2023, and $11.7 million in 2024.

The 2021 financial results showed net sales of $11.8 million (up 5% from 2020) and a net loss of $77.7 million. That loss included $22.0 million in non-cash stock-based compensation expense and a $4.5 million non-cash inventory write-down. Net cash used was $47.2 million. By the time the company reported its 2024 results in early 2025, full-year revenue was $11.7 million (down from the prior year), the net loss was $50.0 million ($2.15 per share), cash and equivalents were $16.3 million, and working capital was negative $9.0 million.

Market Competition and Capital Position

The antimicrobial susceptibility testing market was growing. According to industry research from MarketsandMarkets, the AST market was expected to grow from $4.45 billion in 2024 to $5.68 billion by 2029, a compound annual growth rate of 5.0%. Prominent players included BioMérieux, Becton Dickinson, Thermo Fisher Scientific, and Bruker—companies with extensive distribution networks, existing customer relationships, and diversified product portfolios. Accelerate was a single-product company competing against larger incumbents.

Wave of new competition. According to MDC Associates' industry analysis, four novel AST technologies received FDA clearance over a six-month period. The new competitors included Affinity Biosensors' LifeScale AST, BioMérieux's VITEK REVEAL, Q-Linea's ASTar System, and Selux Diagnostics' platform. Each new test could obtain minimum inhibitory concentration (MIC) values in as little as four hours.

Financial position. With $28.6 million in assets against $84.6 million in liabilities as of December 31, 2024, liabilities exceeded assets. Secured debt was approximately $87 million against $11.7 million in annual revenue, a ratio of roughly 7.5x. As one industry analysis noted, shareholders faced near-total wipeout and secured creditors were positioned to acquire the company's assets.

Prepetition Capital Structure

The company's capital structure included equity and debt financing while operations did not generate positive cash flow.

According to the First Day Declaration, the Prepetition Super Priority Notes holders received stepped-up interest rates and first-lien status through a pre-filing exchange agreement, subordinating the convertible noteholders and elevating the Super Priority Notes' lien position ahead of the credit bid.

The $71 million in convertible notes represented financing as the company pursued commercialization. With Indaba Capital Management holding a significant portion of the secured debt, Indaba later served as DIP lender and stalking horse bidder.

Chapter 11 Proceedings

Filing and stalking horse arrangement. Accelerate Diagnostics filed chapter 11 petitions on May 8, 2025, in the U.S. Bankruptcy Court for the District of Delaware before Judge Karen B. Owens. Accelerate entered bankruptcy with a stalking horse bidder already in place and a DIP financing commitment that would fund the case through an expedited sale process.

Indaba Capital Management, the San Francisco-based investment firm founded and led by Derek Schrier, served in multiple capacities: DIP lender, stalking horse bidder (through its affiliate AST Revolution), and largest secured creditor.

The purchase price consisted of a credit bid of $36.9 million of Indaba's existing secured notes plus its DIP financing commitment. The chapter 11 process was designed to facilitate the sale, confirm a liquidating plan, and exit bankruptcy within 90 days.

DIP financing structure. The DIP facility totaled approximately $36.9 million in aggregate. Only $12.5 million was "new money" capital injected into the estate. The remaining $24.4 million was a roll-up of prepetition debt, converting existing secured claims into superpriority DIP claims.

The DIP draw schedule was structured to provide liquidity in tranches tied to case milestones:

The court entered the Interim DIP Order on May 12, 2025, just four days after the petition date, providing immediate liquidity for operations. The Final DIP Order followed on June 5, 2025, completing the DIP approval process.

Sale process and bidding procedures. The Sale Motion was filed simultaneously with the petition on May 8, 2025. The Bidding Procedures Order entered on June 5, 2025 established the framework for any competing bids.

No competing bidder emerged.

The court entered the Sale Order on July 14, 2025, authorizing the sale to AST Revolution. The asset purchase agreement transferred substantially all of Accelerate's assets, including the core technology, intellectual property portfolio, equipment, and inventory, to the Indaba-affiliated purchaser.

Liquidating Plan and Confirmation

Accelerate's chapter 11 proceeded under a Combined Disclosure Statement and Chapter 11 Plan of Liquidation.

Plan development. The plan evolved through multiple iterations as the sale process progressed:

The timeline was 97 days from petition to confirmation.

Plan classification and treatment. The liquidating plan classified claims in the standard hierarchy, and equity interests were cancelled with no distribution:

Liquidation trust. Following confirmation, Ankura Trust Company, LLC was appointed as Liquidation Trustee, with Young Conaway Stargatt & Taylor, LLP serving as trustee counsel. The trust's purpose is to administer remaining assets, resolve disputed claims, and make distributions to creditors—a process that continues as of late 2025.

Post-confirmation activities have included omnibus rejection of executory contracts, abandonment of certain property with limited value, and ongoing stipulations with American Type Culture Collection regarding administrative expense treatment. The ATCC stipulations—eight separate agreed orders entered between September and December 2025—address administrative expense treatment.

The treatment of general unsecured creditors (Class 5) under the liquidating plan depends on the recovery achieved from any remaining assets after satisfaction of administrative, priority, and secured claims. The securities law claims class (Class 6) covers existing securities law claims; recoveries, if any, would be made under the plan alongside general unsecured claims.

Post-Sale Outcome: AST Revolution and Bruker Acquisition

AST Revolution launch. AST Revolution, LLC officially launched in September 2025 following the court-approved acquisition of select assets from Accelerate Diagnostics. The new company acquired the Accelerate WAVE and Arc Systems and the associated intellectual property portfolio—the core technology developed over decades at Accelerate.

Leadership at AST Revolution came from Accelerate's technical team: Lawrence Mertz, formerly Chief Technology Officer of Accelerate Diagnostics, led the new company. Derek Schrier, Indaba Capital's founder, served as Chairman of the AST Revolution Management Committee. Indaba provided funding to support product development during the initial post-acquisition period.

Sale to Bruker. On November 24, 2025—approximately three months after AST Revolution's launch—Indaba Capital announced the sale of AST Revolution to Bruker Corporation. Financial terms were not disclosed.

Bruker Corporation (Nasdaq: BRKR) is a provider of advanced scientific instruments and analytical solutions for life sciences and materials research. The acquisition expanded Bruker's diagnostics portfolio.

Post-confirmation IP dispute. The sale left a dispute over intellectual property rights. Following the closing, a dispute emerged between imec vzw—a Belgian research institution with an intellectual property portfolio—and AST Revolution regarding which IP rights were transferred in the sale versus retained by imec.

In September 2025, imec (the Interuniversity Microelectronics Centre, an R&D organization in nanoelectronics and digital technologies) filed a motion to interpret and enforce the Sale Order. AST Revolution objected in late September, and imec filed a reply brief in December 2025. The dispute centers on the interpretation of Sale Order provisions regarding intellectual property interests.

The litigation remains pending in the Liquidation Trust administration, with Ankura Trust Company managing the estate's response while AST Revolution (now under Bruker's ownership) defends its position on the scope of acquired IP rights.

Professional Retentions and Fees

Accelerate Diagnostics retained restructuring professionals for the chapter 11 case. Fried, Frank, Harris, Shriver & Jacobson LLP served as lead counsel, with Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel. SOLIC Capital Advisors, LLC provided financial advisory services, while Perella Weinberg Partners LP acted as investment banker. Stretto, Inc. served as claims and noticing agent.

Final professional fee applications were filed in fall 2025, with Fried Frank submitting its Fourth Monthly and Final Application in late September, Morris Nichols and Perella Weinberg filing final applications in October, and Stretto filing its final application the same month. Perella Weinberg Partners earned a $1,750,000 Sale Transaction Fee upon consummation of the sale.

Key Timeline

Frequently Asked Questions

What was Accelerate Diagnostics?

Accelerate Diagnostics was a Tucson, Arizona-based medical diagnostics company focused on rapid pathogen identification and antimicrobial susceptibility testing (AST). Its flagship Accelerate Pheno system could provide results in approximately seven hours—more than 40 hours faster than traditional culture-based methods. The company was founded in 1987 and relaunched in 2012 to commercialize its diagnostics platform.

Why did Accelerate Diagnostics file for bankruptcy?

The company accumulated $718.9 million in losses since inception and never achieved profitable operations or positive cash flows. Despite clinical validation, revenue remained flat around $11-12 million annually while the company faced competition from four new FDA-cleared AST systems that entered the market in 2024. With assets of $28.6 million against liabilities of $84.6 million, liabilities exceeded assets.

Who acquired Accelerate Diagnostics' assets?

AST Revolution, LLC, an affiliate of Indaba Capital Management, acquired substantially all assets through a credit bid. Indaba served as both the DIP lender and stalking horse bidder, effectively using its secured debt position to acquire the company's core technology and intellectual property.

What was the credit bid structure?

Indaba credit bid $36.9 million of its existing secured notes plus provided up to $12.5 million in new DIP financing. The DIP facility also rolled up approximately $24.4 million of prepetition debt ($16.9 million in Super Priority Notes and $7.5 million in Convertible Notes), converting those claims into superpriority DIP claims that would be satisfied through the credit bid.

What happened after the sale closed?

AST Revolution launched in September 2025 under the leadership of Lawrence Mertz, former Chief Technology Officer of Accelerate Diagnostics. About three months later (November 2025), Indaba sold AST Revolution to Bruker Corporation, a provider of scientific instruments and analytical solutions.

Did shareholders receive anything?

No. Class 7 equity interests were cancelled with no distribution under the liquidating plan. With $718.9 million in accumulated losses, liabilities exceeding assets by more than $55 million, and secured creditors credit bidding their debt, there was no residual value for equity holders.

How long did the bankruptcy take?

Only 97 days elapsed from the petition date (May 8, 2025) to confirmation (August 13, 2025). The effective date followed one week later on August 20, 2025.

What is the status of the imec vzw dispute?

Belgian research institution imec vzw filed a motion to interpret the Sale Order regarding intellectual property rights in September 2025. AST Revolution objected, and the litigation remains pending in the Liquidation Trust administration. The dispute centers on which IP interests were transferred to AST Revolution versus retained by imec.

Who is the Liquidation Trustee?

Ankura Trust Company, LLC serves as Liquidation Trustee, with Young Conaway Stargatt & Taylor, LLP as counsel. The trustee is administering remaining assets, resolving disputed claims, and making distributions to creditors.

What was Perella Weinberg's role and fee?

Perella Weinberg Partners LP served as investment banker, advising on the sale of substantially all assets. The firm earned a $1,750,000 Sale Transaction Fee upon consummation of the sale to AST Revolution.

Who is the claims agent for Accelerate Diagnostics?

Stretto, Inc. serves as the claims and noticing agent. The firm maintains the official claims register and distributes case notifications to creditors and parties in interest.

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