BioWorld International Correspondent
Underlining the current fashion for all things RNA-related, Exiqon A/S, a specialist in mRNA and microRNA (miRNA) analysis, raised DKK347.6 million (US$62.7 million) in an IPO on the Copenhagen Stock Exchange that was seven times oversubscribed.
The Vedbaek, Denmark-based firm issued 8.69 million new shares, priced at DKK40 per share, which was close to the top of its previously published indicative range of DKK32 to DKK42 per share. The stock, which trades under the symbol "EXQ," opened at DKK43 last Tuesday and ended its first day of trading at DKK45, a gain of more than 12 percent on the IPO price.
The lead manager and bookrunner on the transaction, the Danske Markets division of Copenhagen, Denmark-based Danske Bank A/S, executed the greenshoe option of 1,303,500 shares two days later, adding another DKK52.1 million to the total proceeds.
Interest from both domestic and international investors was strong. "We had to close the book two and a half days early, actually," Exiqon CEO Lars Kongsbak told BioWorld International. "It's because we are a biotechnology company, and we have products on the market."
Exiqon has doubled its turnover each year over the last four years, and it will post revenues of about $10 million this year, he said. The company's product portfolio of life science research tools is based on Locked Nucleic Acid (LNA), a synthetic, highly stable analogue of DNA and RNA with high-binding affinities for both. It was invented simultaneously, but independently, by Jesper Wengel at the University of Copenhagen (now at the University of Southern Denmark in Odense) and Takeshi Imanishi at Osaka University in Japan.
Exiqon holds exclusive worldwide rights to research and diagnostic applications of LNA. Rights to therapeutic applications are held by Horsholm-based Santaris Pharma A/S, formed through the merger between Cureon A/S - formed as an Exiqon spinout in 1999 - and Pantheco A/S. (See BioWorld International, March 12, 2003.)
Two years ago, when it raised $20 million in a third funding round, Exiqon said it eventually would seek a sale to provide its investors with an exit. However, the explosion of interest in miRNA research has shifted its outlook. "We now see a significant potential in the miRNA business. We're not the only ones to see that," Kongsbak said.
So far, Exiqon has focused on the research market and has built its two main lines of business, in mRNA and miRNA analysis, around its respective alliances with Austin, Texas-based Luminex Corp. and the Roche Diagnostics arm of Basel, Switzerland-based F. Hoffmann-La Roche Ltd.
The company plans to enter the clinical arena as well, initially by using its LNA probes to stratify clinical trial participants on the basis of differing patterns of miRNA biomarker expression. It aims to conclude partnerships with pharmaceutical firms to commence the first such projects next year. In the long term, it also wants to develop molecular diagnostic products based on the linking altered patterns of miRNA expression to disease states - in areas such as cancer, metabolic disease and neurological conditions.
The company plans to spend between a third and half of its IPO proceeds on expanding its present business - on both the sales and marketing front and on the manufacturing front. It will spend the remainder on developing its future clinical strategy. The company is not ruling out making acquisitions, but such a move is not on the immediate agenda. "First of all, it's important that we can demonstrate to all our new investors that we can run the business we are running," Kongsbak said.
The company has 80 employees, 11 of whom are based in the U.S. By the year-end, its headcount will be more than 90 people, Kongsbak said.
Handelsbanken Capital Markets, a division of Stockholm, Sweden-based Svenska Handelsbanken AB, was co-lead manager on the offering.