A Diagnostics & Imaging Week
Genoptix (Carlsbad, California) reported the pricing of its initial public offering of 5 million shares of common stock at a price of $17 per share — about $85 million before expenses — $1 higher than the company’s initial estimated range of $14-$16.
Shares of the diagnostic services provider climbed more than 50% in their first day of trading Tuesday.
Shares jumped $8.51, or 50.1%, to $25.51 in midday trading before closing up $8.35, or 49.1%, to $25.35.
The company offered 4,285,714 shares, and 714,286 shares are being offered by certain selling stockholders. In addition, Genoptix and the selling stockholders have granted to the underwriters a 30-day option to purchase up to an additional 750,000 shares of common stock.
The company’s stock is trading on the Nasdaq Global Market under the symbol GXDX.
The offering was made through an underwriting syndicate led by Lehman Brothers acting as sole book-running manager. Banc of America Securities is acting as joint lead manager and Cowen and Co. as co-manager.
Genoptix is a specialized laboratory service provider focused on delivering personalized and comprehensive diagnostic services to community-based hematologists and oncologists, aiding physicians in making decisions concerning the treatment of malignancies of the blood and bone marrow and other forms of cancer.
The company said it plans to use proceeds from its portion of the offering to grow its work force, establish a second laboratory facility, expand its backup systems, repay all outstanding debt and pursue new collaborations or acquisitions.
• Nanosphere (Northbrook, Illinois) reported that it has priced its previously disclosed initial public offering of 7 million shares at between $14 and $16, to raise proceeds of $95 million if the shares price at the midpoint of the offering.
The company, which makes a genetic-testing system, and is developing diagnostic tests for a variety of medical conditions, including cancer, cardiovascular and neurodegenerative diseases, first filed for its IPO back in August.
The company, which will list its shares on the Nasdaq Global Market under the symbol NSPH, will offer its underwriters an option to purchase an additional 1.05 million shares to cover any over-allotments.
The company said it plans to use about $50 million of the net proceeds to finance ongoing research and development in connection with the development of additional genomic and protein tests and the next generation Verigene system and the continued investments in and development of its product manufacturing infrastructure, including purchasing manufacturing equipment, tooling and facilities leasehold improvements, as well as increased manufacturing personnel. It said it will use about $40 million to fund additional sales, marketing and service personnel and marketing initiatives in connection with future test and system product launches; and the remainder for additional working capital and other general corporate purposes, such as business development, financial and administrative support services, the employment of additional personnel and the costs of operating as a public company.
The company received FDA clearance for the Verigene system, a random access, molecular diagnostics workstation for nucleic acid and protein diagnostics in September. The company also reported FDA clearance of the Verigene system’s first test to determine an individual’s ability to metabolize the anti-coagulant medication warfarin, information critical to determining safe and appropriate dosing.
Verigene uses gold nanoparticle technology to detect nucleic acid targets in a multiplex format. The system is comprised of two core instruments, the Verigene Reader and the Verigene Processor, and a single use disposable test cartridge. The company designed the Verigene system to allow for the simultaneous detection of multiple genetic targets in the same Verigene Test Cartridge format.
Founded nine years ago, Nanosphere said it has raised more than $100 million in private money, including a $57 million venture capital investment last year from a group led by Boston-based Bain Capital. Chicago-based Lurie Investments, Nanosphere’s founding investor, is a major shareholder in the company.
The company has incurred significant losses in each fiscal year since its inception, including net losses attributable to common stock of $18.8 million, $45.7 million, and $18.9 million in the years ended Dec. 31, 2005 and 2006, and the six month period ended June 30, 2007, respectively. As of June 30, the company had an accumulated deficit during the development stage of $124.8 million.
Underwriters for Nanosphere’s planned IPO are Credit Suisse, Piper Jaffray, Leerink Swann, and Allen & Co.
In other financing activity: OpGen (Madison, Wisconsin), a provider of microbial genome analysis, said that it has made an investment, along with a development agreement, in In-Q-Tel (Arlington, Virginia) for enhancement of new optical mapping systems. The investment amount was not disclosed.
“OpGen’s microbial genome analysis technology has been used by commercial, academic, and governmental organizations worldwide, on a service basis, since the company’s inception,” said Colin Dykes, OpGen’s chief scientific officer. He said the agreement “provides further validation of our technology and dovetails perfectly with OpGen’s move towards delivering stand-alone instruments and disposables for microbial analysis.”
OpGen is commercializing a single molecule DNA analysis technology, “Optical Mapping”, for rapid identification and analysis of microorganisms. The system can be used to obtain detailed genetic information with no requirement for prior sequence data, PCR, cloning, or probes. Applications of the new commercial systems include clinical microbial analysis, forensic microbiology and the development of novel molecular diagnostic products.