ViaCell Inc. priced its latest effort at an initial public offering, selling 7.5 million shares of common stock at $7 a share, raising $52.5 million and making it the first biotech IPO in 2005.

And while the total haul is scaled down from previous proposals, and shares priced at the low end of its anticipated range of $7 to $9, the company's stock fared well on its first day of trading. ViaCell's shares (NASDAQ:VIAC) leaped $1.69, or 24.1 percent, to close at $8.69.

ViaCell in early 2002 filed for an IPO, estimating a take of $115 million. It withdrew the offer in December 2003, citing a weak market. (See BioWorld Today, Feb. 1, 2002.)

The company filed again in April, estimating raised funds of $92 million. (See BioWorld Today, April 8, 2004.)

The company has granted underwriters a 30-day option to purchase about 1.1 million shares to cover overallotments. The company has a product on the market and a second potentially rolling out this year.

ViaCell generates revenues from its Viacord product - nearly $31 million in 2003 - a system offering expecting families the option of collecting and preserving their baby's cord blood stem cells. Preserved umbilical cord blood is being considered increasingly important in treating cancer pediatric patients requiring bone marrow transplants, with that market potentially comprising 25 percent of all U.S. births.

The company also is awaiting FDA approval for a new product, Viacyte, used to preserve and store human eggs, potentially a way to extend fertility. ViaCell also is developing a stem cell-based alternative to bone marrow transplants intended to be more effective, have fewer side effects and provide faster patient recovery. The product, CB001, is a concentrated and purified population of stem cells used as a substitute for bone marrow and other transplants. It is being developed in collaboration with Amgen Inc., of Thousand Oaks, Calif.

ViaCell recently commenced enrollment of a Phase I trial for CB001 in 10 patients and plans to complete patient follow-up by mid-2005. If the data look promising, CB001 will be moved into Phase II, the company said. The company in general is addressing technologies to treat cancer, cardiac diseases and infertility.

CS First Boston is the lead underwriter and is assisted by UBS Warburg, Lazard and Leerink Swann & Co.

ViaCell also has a partnership with Genzyme Corp., of Cambridge, Mass., to create a hematopoietic stem cell transplant product.

The company was incorporated in 1994 under the name t. Breeders Inc., but changed its name to ViaCell in April 2000 after acquiring Viacord Inc., a private umbilical cord blood-banking business. Since its inception, the company has lost more than $128 million.

ViaCell and three other companies in the cord stem cell sector are embroiled in patent litigation with PharmaStem Therapeutics, of Larchmont, N.Y. ViaCell is appealing a ruling against it in the case, saying that failure to do so could result in the loss of revenue or the requirement to pay out royalties.

No Comments