Reditus Laboratories to cease operations
PEKIN (25 News Now) - Pekin-based Reditus Laboratories, the company of former CEO Aaron Rossi, will close its doors this coming Friday, November 4.
Founded in 2019, Reditus was first started as a handful of testing labs, evolving into a broader operation to respond to the growing needs of the pandemic in 2020. Since then, it’s performed millions of COVID-19 PCR tests over the past three years, receiving millions in federal grant money to help run its operation. In the release issued Monday, the company says along with its dissolution, they expect to liquidate its assets in the coming months. The lab now has a court-ordered receivership related to Reditus’ previous owners since April, which has managed and run the company since.
Reditus originally partnered with Tri-County Pathology, a provider for pathologists hired to work at testing facilities since the law dictates a laboratory cannot hire other physicians on its own to manage operations. After lengthy negotiations, Tri-County was notified they would no longer need to provide services to Reditus after November. According to its president, Dr. Larry Rossi, who is also Aaron’s father, the receivers hadn’t paid for the services of a lab medical director for six months. At the same time, the receivers had the option to bring in a different pathology group if re-negotiating with Tri-County wasn’t an option. Rossi claims the receivership was averse to company growth, seeing it as a chance to force parties into a settlement. According to him, they weren’t the right entity to grow a business.
“If we had...a working relationship, then it would be a different story,” he says. “But it has not been made evident to me, and has never been made evident to me, that this was the intent.”
As for what will happen to the facility, Rossi says that’s to be determined, with the building owned by a separate LLC. But he says at some point in the future, he wants to bring the lab services back, accomplishing the same tasks Reditus originally set its sights on when it was founded.
“I would like to see another laboratory doing the same thing that we started out doing,” he notes. “My dream would be to have all the people working there working for us at the new laboratory.”
At peak, the company employed 300 people, with that number now down to 160. According to the release, the remaining staff have received a ‘legally-required advance notice of the closing of the company’ from the receivership, allowing them the chance to explore other positions elsewhere. Rossi expressed gratitude for the work of those in the company’s employ, and expressed his remorse that affairs had gotten to this point.
“Leaving it where it is, I pray that people understand this was not done with disregard or malcontent,” he says.
The company has been in an ongoing dispute between owners, with the court-ordered receivership appointed as a result of that dispute since April 14. That case involved Larry Rossi’s son Aaron, the former CEO of the company surrounded by legal difficulties over the course of the past year. Litigation includes business partners like Dr. Jim Davie suing Rossi for allegedly pushing them out of Reditus, misuse of company funds (including over $200 million in state COVID testing contracts), and multiple counts of mail and tax fraud in separate cases. He has been the target of controversy for writing prescriptions without a full medical license.
We reached out to Jim Keane, the acting CEO of Reditus appointed by the receivership, for comment. He told us that he’s limiting his comments at this time, but will have more information in the near future. We also reached out to Harney Partners, who are handling the receivership, and are waiting to hear back.
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