A Medical Device Daily
CCS Medical Holdings (Clearwater, Florida) expects to raise $137.8 million after expenses from its initial public offering of 10 million shares, according to its filing with the Securities and Exchange Commission.
CCS said in the filing that it expects the offering to price between $14 and $16 a share.
If the underwriters exercise their option to buy additional shares in full, the company expects to raise $158.8 million, based on an assumed offering price of $15 a share.
The company provides mail-order delivery of medical supplies to treat diabetes, pulmonary disease, incontinence, and respiratory illnesses. CCS distributes a variety of pharmaceutical products and medical supplies including blood glucose meters, catheters, insulin pumps, nebulizers, and ostomy and wound care supplies. According to the company, it is one of the largest providers of respiratory medications and diabetes testing supplies to Medicare customers. CCS was formed in 2005 by the merger of Chronic Care Solutions and Mp TotalCare and is majority-owned by venture capital firm Warburg Pincus (Medical Device Daily, Oct. 4, 2005).
CCS also said in the filing that it would use the proceeds from its IPO to repay a portion of its debt.
According to the SEC filing, for the three months ended June 30, CCS expects to report earnings between $2.2 million and $2.5 million on a revenue range of $136.3 million to $139 million. In the same period of 2006, the company reported losses of $10.6 million on revenue of $103.3 million.
Also listed as a risk factor in the filing, the company said it is highly dependent on payments from third-party healthcare payors, including Medicare, Medicaid and other government-sponsored programs and the uncertainty of third-party reimbursement could adversely affect its business.
In other financing activity:
• NeoStem (Melville, New York) reported completion of the second closing of its public offering generating $1 million in gross proceeds. Together with the gross proceeds of the first closing of the public offering last week, the company said it has raised an aggregate of about $6.3 million.
The public financing was comprised of 1.27 million units with each unit consisting of one share of common stock and one-half of a five year Class A warrant to purchase one-half a share of common stock at a price of $6 a share.
Last Thursday NeoStem’s common stock and units began trading on the American Stock Exchange (MDD, Aug. 10, 2007).
The underwriter for the offering was Mercer Capital, members of the National Association of Securities Dealers.
NeoStem is a biotechnology services company enhancing the delivery of adult stem cell therapeutics to health-conscious consumers. The company is developing a nationwide network of adult stem cell collection centers, enabling people to donate and store their own stem cells with NeoStem for personal use years or decades later in times of critical medical need.
• Isolagen (Exton, Pennsylvania) said it has obtained commitments to buy shares of its common stock in a registered direct offering for gross proceeds of $13.8 million.
Isolagen will sell about 6.76 million shares of its common stock at $2.04 a share to institutional investors. The closing of the offering is expected to take place tomorrow, subject to the satisfaction of customary closing conditions. These shares are being offered under an effective shelf registration statement previously filed with the SEC.
Yesterday the company submitted an application with the SEC to voluntarily withdraw the registration statements filed in July (MDD, July 12, 2007) relating to a proposed exchange offer involving holders of its currently outstanding 3.5% subordinated convertible notes due 2024 and a proposed offer to the public of an additional $30 million in principal amount, of new senior convertible notes due 2024.
Isolagen is an aesthetic and therapeutic company. Its technology platform includes the Isolagen Process, a cell processing system for skin and tissue rejuvenation which is currently in clinical development for a broad range of aesthetic and therapeutic applications including wrinkles, acne scars, burns and periodontal disease. Isolagen also commercializes a line of skincare systems through its majority-owned subsidiary, Agera Laboratories (Wilmington, Delaware).
• Patient Safety Technologies (PST; Los Angeles) reported that it entered into agreements restructuring all of its debt held by Ault Glazer Capital Partners. Prior to the restructuring, the company owed about $2.95 million in principal and accrued interest, which was advanced under three separate agreements: a revolving credit facility of $420,000; a secured promissory note of $780,000; and a secured promissory note of $1.75 million.
The revolving credit facility, which was in default, was converted into 337,439 shares of the company’s common stock at a conversion price of $1.25 a share. The other two secured promissory notes, one of which was in default, were combined into a single convertible secured promissory note in the principal amount of $2.53 million with an effective date of June 1, 2007. The promissory note bears interest at the rate of 7% per annum and is due Dec. 31, 2010, or the occurrence of an event of default, whichever comes earlier. In the event that the average closing price of the company’s common stock is in excess of $5 a share for 30 consecutive trading days, PST will have the right to redeem thromissory note in shares or in cash. If that happens, the principal is convertible into shares of the company’s common stock at a conversion price of $2.50. The promissory note is secured by all of the company’s assets.
PST focuses on the acquisition of controlling interests in companies and the research and development of products and services in the healthcare and medical products field, particularly the patient safety markets. Its wholly-owned subsidiary, SurgiCount Medical (Temecula, California) makes patient safety products.