By Matthew Willett

Wall Street's resurgent appetite for new biotech issues shows no sign of being sated yet. The latest beneficiary of investor interest in young genomics companies, Genaissance Pharmaceuticals Inc., grossed $78 million in an initial offering of 6 million shares of common stock at $13 per share.

CEO Gualberto Ruano said the $72 million the company is netting from offering will take the pharmacogenomics company to another level.

"I think the key point here is the stature of the company. Sure, we can use the financing, but to me it's an instrument to cement the company as leaders in looking at genetic variety in people," Ruano said.

New Haven, Conn.-based Genaissance applies population genomics and informatics to drug development and marketing. Founded in 1997, the company uses its HAP technology, focused on haplotype marker identification, and its DecoGen informatics system to find correlations between genetic variance and drug responses.

The company completed a private placement financing in March, raising $60 million from investors including Johnson & Johnson Development Corp., A&A Actien Bank, Caanan Partners, Alta Partners, Chase Capital Partners, Lombard Odier & Cie and Sofinov.

Deutsche Banc Alex. Brown, Bear Stearns & Co. Inc., Solomon Smith Barney and UBS Warburg LLC acted as underwriters for the IPO, and Genaissance offered the financiers an additional 900,000 shares to cover overallotments.

Ruano said the offering will fund operations within the company's mednostics and informatics programs.

"The proceeds are going to be utilized to ramp up the mednostics program. We do comparative analysis of drug effectiveness and find markers of variability that predict response to compounds," he said. "We do trials of all our genomics analyses and generate intellectual property, and a large part of the proceeds will go to that."

Ruano added that the offering will fund expansion of informatics programs, which account for about 40 percent of the company's revenue.

In the nearer term, Ruano said alliances and licensing will probably generate revenue more readily than expansion.

Genaissance currently collaborates with Gene Logic, of Gaithersburg, Md., for shared access to gene expression and gene variance data.

The company's stock (NASDAQ:GNSC) jumped 23.5 percent in its first day of trading Wednesday, closing at $16.063.

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