Activist investor Altai Capital Management has urged sweeping changes at OraSure Technologies, Inc. (NASDAQ:OSUR), arguing the diagnostics company's prolonged underperformance and governance issues are eroding shareholder value.

In a letter to the board, Altai outlined a five-point case for reform and called for the appointment of its nominees to help realign strategy and incentives.

Activist Flags OraSure Long-Term Underperformance

Altai, which owns roughly 5% of OraSure's outstanding shares, criticized the company's stock performance over five- and ten-year periods, noting it has lagged peers and broader market benchmarks.

The investor attributed the weak returns to repeated operational and strategic missteps under the current leadership.

It also raised concerns about continued cash burn tied to what it described as speculative diagnostics investments, arguing these decisions have come at the expense of shareholder returns.

OraSure reported a fourth-quarter adjusted loss of 19 cents, beating the consensus loss of 20 cents. Sales of $26.76 million marginally surpassed the Wall Street estimate of $26.44 million.

Governance Concerns And Incentive Misalignment

The letter aimed at board structure and executive pay, highlighting that independent directors collectively own less than 1% of outstanding shares despite earning more than $250,000 annually.

Altai argued that limited ownership reduces accountability, especially as investors have borne the financial impact of declining share value.

The firm also questioned CEO compensation, stating that more than 90% of Carrie Eglinton Manner's pay is not linked to stock performance.

According to Altai, she has earned about $15 million during her tenure, while shareholders have seen a roughly 60% decline in value since 2023.

Push For Strategic Review For OraSure, Board Representation

Altai is advocating for a broader strategic review, including a potential sale of the company, alongside its current operating plan.

It said such a process is necessary to ensure the best outcome for shareholders.

The firm is seeking board representation through the appointment of Rishi Bajaj and John Bertrand.

OraSure Expects To Return To Growth In 2026

The diagnostic test maker issued a statement on Tuesday highlighting its significant operational progress and value creation initiatives.

The company stated that Altai has rejected all settlement proposals, mainly aiming to secure board representation for its founder.

OraSure also said it is expected to return to revenue growth in 2026 as core end-markets stabilize and precision medicine adoption improves.

Growth should be further supported by the commercial launch and scale-up of key products, including the Sherlock rapid molecular self-test for CT/NG and the Colli-Pee at-home urine collection device, targeting a combined $2 billion market opportunity.

The company expects first quarter 2026 sales of $26 million-$29 million versus the consensus of $28.599 million.

OSUR Stock Price Activity: OraSure shares closed 4.79% lower at $2.98 on Tuesday, according to Benzinga Pro data.

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