By Karen Pihl-Carey

Gene Logic Inc. raised net proceeds of $222.5 million, more than twice what was originally expected, in a public offering of common stock that will help the company expand development and marketing efforts of its database products.

While the Gaithersburg, Md.-based company planned to offer 3.5 million shares at a price of $29.50 a share, its stock climbed rapidly over the last two weeks, resulting in the company upping the offering to 4.2 million shares at a price of $56 a share. (See BioWorld Today, Jan. 14, 2000, p. 1.)

The company's closing stock (NASDAQ:GLGC) price on Jan. 13, the day the offering was announced, was $25.75, compared to the closing price Thursday of $64.187, up $4.062 for the day.

"Clearly our policy is not to comment on stock activity," said Robert Burrows, director of corporate communications for Gene Logic. "Who knows? The whole sector, as you know, it's on fire, and whether our footprint is growing within the sector, that's a possibility.

"Suffice to say," he told BioWorld Today, "there was an extremely high interest in hearing our story [at the recent Chase H&Q Healthcare Conference in San Francisco]. The underwriters did a fantastic job in putting us in front of top-tier institutions across the country, and it did have a dramatic impact on our institutional shareholder base."

Gene Logic plans to use the funds for product and technology development, to expand database product marketing efforts, to provide working capital and for general corporate purposes, including acquisitions.

All of the shares are being sold by the company, which has granted the underwriters a 30-day option to purchase up to an additional 630,000 shares to cover overallotments. If that option is fully exercised, it would raise an additional $35.3 million. Underwriters include New York-based ING Barings Furman Selz LLC, the lead manager; Chase H&Q, of San Francisco; BancBoston Robertson Stephens Inc., of New York; and Dain Rauscher Wessels, of Minneapolis.

Gene Logic markets two types of gene expression database products to the pharmaceutical, health-care and life science industries. It has 13 customers for its custom databases and related software products, and two customers for its GeneExpress reference database suite, which completed development in November.

Gene expression is the degree to which genes in a cell are switched on or off, or regulated. It is used to assist in biomedical research, particularly drug discovery and development.

The company just announced at the H&Q conference its first two subscribers to GeneExpress. One is a large pharmaceutical company that is not being disclosed; the other is Therapeutic Genomics Inc., a company developing cancer drugs.

With 20 million shares currently outstanding, the company expects to have about 24.2 million outstanding shares following the offering, Burrows said.