By Mary Welch
Rosetta Inpharmatics Inc. joined the initial public offering (IPO) bandwagon as the Kirkland, Wash., company filed to raise $115 million to expand its informational genomics platform.
Rosetta, which develops DNA microarray gene expression technologies and information systems, plans on expanding its genomics platform to include other data types and analysis tools. It also intends to use the proceeds for increased marketing and sales efforts and research and development purposes.
Warburg Dillon Read LLC, of New York, is lead manager of the offering. Lehman Brothers and Prudential Vector Healthcare Group, both of New York, are co-managers.
The proceeds should last Rosetta until December 2001, according to the prospectus. The company did not disclose how many shares would be offered or at what price.
Founded in 1996 with $37.9 million in private equity, Rosetta is an informational genomics company with a focus on gene expression technology. Informational genomics is the acquisition and analysis of information gathered from throughout the cell to identify a majority of the medically important drug targets and gene functions. By combining informatics and genomics, Rosetta's technologies are designed to allow researchers to explore the causes and consequences of changes in gene expression, and to focus on those cellular processes that are specifically affected by pharmaceuticals, chemicals or genetic engineering.
The platform can speed the transformation of drug discovery by converting the rapidly growing amount of gene expression profiling data into organized, statistically driven, information-based solutions, the company said.
According to the company, its technologies are the first to allow for a comprehensive knowledge of a compound's target activities within any cell type.
The company's technology platforms are Resolver Expression Data Analysis Stem, FlexJet DNA microarrays and Coherent Expression Profile Data Sets.
Last year the company deployed its first bioinformatics product, the Resolver system, which allows for the storage, retrieval and high-level analysis of massive volumes of gene expression data. The company has a development and investment partnership with Agilent Technologies, of Palo Alto, Calif., to further develop the system. Agilent purchased 2.2 million shares of stock and later bought another 459,792 shares in Rosetta's Series E preferred stock round. Rosetta has the option to sell Agilent another $10 million in common stock up to the time of this public offering, the prospectus said.
The FlexJet DNA microarrays are a next-generation DNA microarray platform. With it Rosetta can design and produce customized oligonucleotide arrays representing thousands of genes per array in a matter of hours or days, the company said.
The Coherent Expression Data Sets are libraries of high-quality gene expression data.
The company reported 1999 year-end revenues of $983,000, a net loss of $19.8 million and $19.3 million in cash. As of Thursday, there were 21.5 million shares outstanding.
Among the company's largest institutional shareholders are Vulcan Ventures Inc., of Bellevue, Wash., which owns about 3.3 million shares, followed by Lombard Odier & Cie Ltd., of Geneva, Switzerland, which owns about 1.2 million shares and Olympic Venture Partners, of Kirkland, which owns about 1.2 million shares.
Rosetta's proposed Nasdaq symbol is RSTA.