On Friday, ZymoGenetics Inc. CEO Bruce Carter arrived at The Nasdaq Stock Market with the honor of officially launching the day’s trading trading that for the first time would contain shares of ZymoGenetics and was able to watch the reaction of the employees back in Seattle through a live, two-way video feed that stayed up through ZymoGenetics’ first trade at 11:00 a.m. EST.

His employees were so pleased they were nearly unruly.

“I think they were drinking champagne at eight in the morning [PST],” he said. “Maybe that’s why they were so raucous.”

They have reason to be. ZymoGenetics has had a long but productive road to its $120 million initial public offering. Founded in 1981, the company was bought by Novo Nordisk, of Bagsvaerd, Denmark, in 1988. It operated as a research arm for Novo until it was spun back out through a $150 million private placement in October 2000 that reduced Novo’s stake in ZymoGenetics to less than 50 percent of voting shares. (See BioWorld Today, Oct. 24, 2000.)

Once independent again, ZymoGenetics filed for its initial public offering late in 2001’s third quarter, having the unfortunate timing of filing a day before the events of September 11 hammered the markets shut. Since then, the company has patiently waited for things to turn around. (See BioWorld Today, Sept. 11, 2001.)

“We’re thrilled to get it through now,” Carter told BioWorld Today. “We’re thrilled that the investors stuck with us.”

The joint book-running managers are Lehman Bros. Inc., of New York, and Merrill Lynch & Co., also of New York. Co-managers are Bear, Stearns & Co. Inc., of New York, and Pacific Growth Equities Inc., of San Francisco. Underwriters have an overallotment option on 1.5 million shares.

The 10 million shares at $12 apiece give ZymoGenetics funds “primarily for the development of [its] drugs and to build up our infrastructure,” Carter said. Its 45 million-plus shares outstanding reduced Novo’s stake in ZymoGenetics to “just under 48 percent,” although because of a standstill agreement, Novo is not allowed to have more than 49 percent of voting shares at any point.

For its more than 20 years of operation, ZymoGenetics has had a hand in discovering and developing five protein products now on the market. Carter said ZymoGenetics sees about $10 million annually in royalty payments from those products, although it receives nothing from NovoSeven (a product used to control bleeding in hemophiliacs), which Novo retained when the companies separated. ZymoGenetics stands alone, public and productless now, but has a strong intellectual property portfolio of 225 issued U.S. patents and a bundle of preclinical compounds. Its focus has been, and continues to be, therapeutic protein-based products, Carter said, and human trials loom for 2002.

“I think that is what is really attractive to investors we were only looking at protein therapeutics,” Carter said. “We have everything in preclinical, but we will put recombinant Factor XIII in the clinic this year.” Rh Factor XIII is designed to prevent blood loss with major cardiac surgery and to treat congenital Factor XIII clotting deficiency.

At $120 million, ZymoGenetics’ IPO is not only the first of 2002 in the biotechnology sector, but also beats any biotech IPO completed in a rather dry 2001. Its stock (NASDAQ:ZGEN) closed up 5 cents Friday, ending the day at $12.05.

Carter, speaking between live feeds the second when ZymoGenetics closed the market at the end of trading spoke about a day rife with feelings not only for himself, but also the company’s 305 employees.

“I think [the IPO] simply continues on from the spinning out,” he said. “There was a lot of pent up energy that we managed to release by spinning out from Novo and that continues here.

“It’s terrific fun,” he added. “When you arrive [at Nasdaq] in the car and then you see that huge electric board that says Welcome ZymoGenetics,’ it’s a thrill.”