Response Genetics Inc. raised $21 million through an initial public offering of 3 million shares at $7 per share.
The Los Angeles-based company is developing pharmacogenomic cancer diagnostic tests. Its technologies are designed to enable extraction and analysis of genetic information from genes derived from tumor samples. RGI's revenue comes primarily from the sale of its analytical pharmacogenomic testing services of clinical trial specimens to the pharmaceutical industry.
Response Genetics had about $6 million in revenues in 2006, and $1.6 million in the first quarter of this year. The company had $2.2 million cash and equivalents March 31, with 10.14 million shares outstanding following the offering.
Part of its strategy is to leverage its existing pharmacogenomic services business, which entails a menu of fee-based services to support drug development and clinical trials with biomarkers, including gene expression analysis, statistics, molecular diagnostics and fluorescent in situ hybridization.
Response Genetics shares (NASDAQ:RGDX) closed at $7 in their debut Tuesday, unchanged.
Maxim Group LLC is lead underwriter for the IPO; Caris & Co. is co-manager. They have a 45-day option to purchase up to 450,000 additional shares to cover overallotments.
In other financing news:
• Amylin Pharmaceuticals Inc., of San Diego, priced a private placement of $500 million of 3 percent convertible senior notes due 2014. The notes would be convertible under certain circumstances at an initial rate of about $61.07 per share, a 40 percent premium to Monday's closing price. Purchasers have an option to buy up to $75 million more of the notes. Proceeds will be used for commercialization and development programs and to establish additional manufacturing sources, as well as for potential acquisitions or investments in complementary technologies or businesses and other corporate purposes.
• Austrianova Biomanufacturing AG, of Vienna, Austria, said it completed the first closing of what it expects to be a €35 million (US$47.3 million) financing round. Funding was provided by Ryan Group Holdings, though the amount of the initial investment was not disclosed. Austrianova focuses on cell encapsulation, a method of drug delivery with diverse applicability. The company said funds would enable it to complete Phase III trials of NovaCaps in pancreatic cancer, and to finance other projects.
• Resverlogix Corp., of Calgary, Alberta, entered into a bought-deal private placement as part of a follow-on option on the first financing, which closed in January. The definitive agreement provides for the sale of $25 million in 8 percent secured convertible promissory notes, which would be convertible into about 1.5 million of common shares (at C$17.50 per share) and accompanying warrants to purchase an additional 530,000 shares at C$20.63 per share.
• BioSurface Engineering Technologies Inc., of Rockville, Md., said it completed an $11 million equity financing. The privately held company is developing synthetic peptide growth factors as devices for bone and tissue-repair applications. The financing was led by PTV Sciences, which was joined by new investors Westfield Capital and Heron Capital. Existing investors participating in the funding included the Vertical Group, EDF Ventures, MB Ventures and New Markets Growth Fund.
• Quark Biotech Inc., of Fremont, Calif., set the proposed terms of its initial public offering at 5 million shares at $12 to $14 per share, which would gross $65 million at the midpoint of that range. Quark registered for an IPO of up to $86.3 million in March. The company is developing the siRNA agent RTP801i-14 in a Phase I/II trial, along with other clinical and preclinical programs. (See BioWorld Today, April 2, 2007.)