A Diagnostics & Imaging Week

Luna Innovations (Roanoke, Virginia), which develops molecular and sensing technologies, has amended its previously disclosed initial public offering (IPO) reducing the deals value by about 27% to $32 million.

The IPO will now consist of 4 million shares offered at $6 to $8 apiece, down from $11 to $13, previously, the company said in a filing with the Securities and Exchange Commission. The $32 million figure assumes that the offering prices out at the high end of the new range.

Managers of the offering have received an option to sell up to 600,000 additional shares to cover any over-allotments.

The company said that proceeds from the offering will be used to pay for further development and expansion of Luna's products and product candidates, and for general working-capital purposes.

Among the risks listed by Luna is its plan to develop and commercialize "multiple products . . . across many industries, technologies and markets" and the possibility that it cannot manage this "simultaneously." It said that as of Dec. 31, 2005, it had "68 research contracts covering a broad range of technologies . . ." and that "expanding our operations into new geographic areas and relying on multiple facilities to develop and manufacture different products concurrently pose additional challenges."

The shares are expected to trade on the Nasdaq Stock Market under the symbol LUNA.

Luna's technologies have a range of uses, including MRI testing, solar cells, protective coatings, and wireless and fiber-optic monitoring systems.

Asuragen (Austin, Texas), an oncology molecular diagnostic company and molecular biology service provider, reported that it has secured $49 million in Series A funding.

Asuragen is a new company resulting from the sale, in March 2006, of the Research Products Division of Ambion (Austin) to Applied Biosystems Group (Foster City, California) in a deal valued at $273 million, with the company then formed in March.

Asuragen said it will dedicate the funds towards general operating needs and to pursue strategic licenses relating to the development of its cancer diagnostic and therapeutic programs.

The initial A-round of investment was led by Telegraph Hill Partners (San Francisco), included Growth Capital Partners (Houston) and other firms that invested in Ambion.

"We believe Asuragen's proven capabilities in molecular technologies have the potential to support major advances in the diagnosis and treatment of oncological diseases," said Matt Mackowski, managing director of Telegraph Hill.

Matt Winkler, founder and CEO of Asuragen, said, "We have a solid foundation of compelling technologies that set us apart from other companies. With this level of funding, combined with our expertise in miRNAs and pending patents, we are in a strong position to develop highly effective early cancer detection tools.

Appointed president of Asuragen is Rollie Carlson, coming from Abbott Laboratories (Abbott Park, Illinois) with experience in molecular diagnostic and pharmaceutical business areas. He managed the worldwide Vysis molecular diagnostic business following its acquisition by Abbott Laboratories.

Asuragen is comprised of two of Ambion's former divisions, Diagnostics and Services, along with the formation of a new Discovery group for developing new technologies that the company said "will become cutting edge clinical products" and expand Asuragen's product portfolio, which consists of Signature Genetic Testing and Oncology Testing products, as well as controls and standards engineered using its patented Armored RNA technology.

Asuragen recently formed a partnership with Digene (Gaithersburg, Maryland) to market its Signature cystic fibrosis screening products.

Asuragen defines its vision as becoming "a fully integrated, diagnostic reagent company focused on molecular oncology and early detection of cancer, with emphasis in microRNAs. It defines its expertise as in assay development, business infrastructure and an established cGMP manufacturing facility that allow it to span the spectrum of discovery, production and commercialization.

• AFP Imaging (Elmsford, New York) reported that it has closed on the sale of 2.78 million shares of its common stock in a placement to selected institutional and other accredited investors. The offering was priced at $1.80 per share.

In conjunction with the placement, the company granted the investors certain rights with respect to the resale of the shares acquired.

David Vozick, chairman of AFP, said the funding will support growth in the company's imaging product line. "AFP continues to invest in new technologies to support the clinical transition from analog to digital imaging, and to maintain its competitive advantage in the rapidly expanding human and veterinary dental imaging markets."

AFP manufactures digital radiography and other imaging equipment, reporting its branded products used in more than 100,000 dental, veterinary and medical facilities. Its new product initiatives include the Digi-Vet Equine system and an OEM agreement with the Easy Dental subsidiary of Henry Schein (Melville, New York) for the sale of its intra-oral digital X-ray sensor.

• PBI Technology (PBI Tech; Seattle) reported entering an agreement with Evergreen Innovation Partners (Evergreen), granting Evergreen an exclusive, license to patents and know-how for its SalivaSac technology for use in consumer and over-the-counter markets. SalivaSac is a device that collects a sterile filtrate of saliva.

Evergreen's efforts will focus initially on saliva-based screening for elevated glucose levels but said it may extend this to screening for cholesterol and certain hormones. If successful, PBI Tech and Evergreen IP will share royalties on sales of future products derived from the SalivaSac.

Mario Ehlers, MD, PhD, president and COO of PBI Tech, said: "We believe we have an opportunity to address a significant unmet need, namely development of a home-based screening device for assessing risk for diabetes and associated complications . . . An estimated 41 million individuals in the U.S. alone who are pre-diabetic and at high risk of developing diabetes."

PBI Tech develops molecular diagnostic technologies, non-invasive diagnostic devices, and early-stage, targeted drug candidates for cardiovascular, bone and joint, and metabolic disorders.

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