By Mary Welch
Genaissance Pharmaceuticals Inc., a population genomics and informatics company, filed for an initial public offering to raise $115 million.
The company intends to use the proceeds to purchase consumables and equipment for the discovery of its haplotype (HAP) markers, hire additional informatics personnel to improve the capabilities and features of the DecoGen informatics system, and fund its internal Mednostics program.
Deutsche Banc Alex Brown Inc., of New York, is the lead underwriter. Bear Stearns & Co. Inc., Salomon Smith Barney Inc. and Warburg Dillon Read LLC, all of New York, also are participating.
The New Haven, Conn.-based company raised $60 million last month in private equity financings, with the proceeds going to further integrate gene variation information into the drug development process using the HAP technology. At the time, Genaissance CEO Gualberto Ruano said it was one of the largest private financings in the history of genomics. (See BioWorld Today, March 15, 2000, p. 1.)
The HAP technology consists of gene-based HAP Markers - or genetic "bar codes" - and the DecoGen Informatics platform. The HAP Markers encompass all the gene variations that exist in a particular drug target and provide for a comprehensive analysis of genetic variation, the company said.
The DecoGen platform is an intuitive search engine for correlating genetic markers with a drug response. It contains a proprietary computational tool that facilitates the use of HAP Markers for HAP Typing. HAP Typing measures which of the HAP Markers are present in a patient's clinical blood sample.
Founded in 1997, the company already has validated the predictive power of its HAP technology with a study on respiratory disease that showed the HAP Markers are more powerful in predicting therapeutic response to beta 2 receptor agonists than are single nucleotide polymorphisms, or SNPs, Ruano told BioWorld Today at the time of the private financing round.
The company is marketing its technology to the pharmaceutical industry as a fully integrated genomics solution for developing smarter clinical trials and for increasing the sales of approved drugs. The technology combines an informatics system, proprietary genomic markers and a high-throughput process for analyzing clinical samples to correlate drug response with patients' genomic variations.
Using its HAP Technology, the company has discovered HAP Markers for 604 genes and filed patent applications for HAP Markers for 365 of them. Genaissance is capable of discovering HAP Markers for about 50 genes per week and intends to increase this number to approximately 160 genes per week by the fourth quarter of this year, it stated in the registration filing.
The Mednostic program focuses on finding HAP Markers that confer a marketing advantage to approved drugs. In a way, the Mednostic program is a fine-tuning of the drugs and the tailoring of them to various human populations based on genetic differences.
The program's goal is to identify individuals who will respond better to a particular drug within a competitive class than to other drugs, identify individuals who are prone to side effects and adverse reactions, and identify individuals who currently are not undergoing therapy for a given disease, yet who are at risk and will respond well to a given drug.
The company, as of March 31, had $55 million in cash. It posted 1999 year-end revenues of $600,000, and a net loss of $11.4 million. For the first quarter of 2000, it had revenues of $2 million and posted a net loss of $4 million. The company has deals with Visible Genetics Inc., of Toronto, and Telik Inc., of South San Francisco.
Among the principal institutional shareholders are International BM Biomedicine Holdings Inc., of Basel, Switzerland; Connecticut Innovations Inc., of Rocky Hill, Conn.; Kleinwort Benson, of New York; CB Capital Investors LLC, of New York; A&A Geinvest LLP, of Frankfurt, Germany; and Sofinov Societe Financiere D'Innovation Inc., of Montreal.
The proposed Nasdaq ticker symbol is GNSC.