About three years after withdrawing its first proposed initial public offering, Xenogen Corp. has decided to try it again - this time aiming to raise $51.75 million.
The Alameda, Calif.-based company attempted to take advantage of the open-armed public markets of 2000, filing to raise $86.25 million that September. It pulled the IPO in April 2001 due to market volatility.
With several IPO pricings late last year and during the first quarter of this year, many biotech companies seem to be counting their blessings - happy to get an IPO through, even at a lower pricing. The last few years were bleak at best for those eyeing the public markets. In fact, all of the biotech IPOs conducted in the U.S. since January 2001 until now do not equate to even half of the number - 68 - of the IPOs conducted in 2000.
Xenogen officials could not comment Tuesday due to SEC-imposed quiet-period rules. In its prospectus, Xenogen did not specify the number of shares to be offered or the expected price range. However, it did say that net proceeds would be used to expand its sales and marketing organization, continue its research and development efforts and expand its manufacturing capacity for IVIS Imaging Systems. The company also plans to use funds to expand its portfolio of technologies and reagents, as well as to cover working capital and other general corporate purposes.
Thomas Weisel Partners LLC, of San Francisco, is serving as lead underwriter for the IPO, while CIBC World Markets Corp., of New York, and JMP Securities LLC, of San Francisco, are serving as co-managers.
Xenogen expects to list its shares on the Nasdaq National Market under the ticker symbol "XGEN."
Throughout the U.S. and Europe, Xenogen sells instruments and equipment, software and reagents that improve the productivity and efficiency of drug discovery and development.
Its products include the biophotonic IVIS Imaging Systems, the reagents Bioware and the LPTA (light-producing transgenic animals) models.
The IVIS Imaging System, its living animal models and research services speed up in vivo data collection and analysis. The company genetically engineers cells and animals to emit light, enabling them to display a tumor, disease, pathogen, organ or a biochemical reaction. Xenogen uses its products to validate predictive animal models for preclinical work.
Xenogen gets revenue from one-time sales fees, long-term service contracts and multiyear licensing fees for its biophotonic imaging technologies and the sale of light-producing transgenic animals, cell lines and reagents.
In addition to its products, the company offers contract research services for production of transgenic animals and knockout animals, as well as custom animal production and phenotyping services for target validation and compound screening.
The company's technology allows researchers to observe the disease and molecular mechanisms of living organisms in a noninvasive manner. The researchers can observe the spread of a disease or cancer, as well as the effects of a drug. That should help reduce the costs of drug development failures, the company said.
In April 2003, Xenogen entered a two-year collaboration with Charles River Laboratories Inc., of Wilmington, Mass., to market Xenogen's genomic services. Xenogen also has a similar agreement with Taconic Farms Inc., of Germantown, N.Y., for LPTA models.
As of Dec. 31, the company had cash, cash equivalents and short-term investments of $13.5 million. It also had about $20.8 million of revenue backlog for its products, licenses and services. Since its 1995 inception, the company has incurred $145.9 million in net losses.
Xenogen raised $22 million in July, bringing the total private funds raised by the company to more than $100 million.
As of the end of February, the company had 73.2 million shares of common stock outstanding.