SYDNEY, Australia ¿ A newly listed biotechnology company, Medica Holdings Ltd., in Brisbane, has raised A$8 million (US$5 million) for a range of projects in an initial public offering (IPO), but its shares had a lackluster debut on the Australian exchange.

The company¿s IPO aimed at raising a minimum of A$4 million, and managed to pick up another A$4 million from investors, before closing in mid-March. Medica had previously raised and invested A$1.8 million, mainly from private investors.

But some of that apparent investor enthusiasm had evaporated by the company¿s listing debut on March 31, with Medica¿s shares briefly kicking up above the listing price of A70 cents a share before dropping fast to finish the day on A62 cents.

At the close of business on Thursday, when the Australian market stopped for the long Easter break, the stock had crept up A3 cents to finish at A65 cents. Medica¿s managing director, Kevin Healey, said that low price had been struck for a sale of only 3,000 shares, and the first day had seen demand at much higher prices. He said he remained confident about the strength of the company¿s share price.

Healey said Medica is unusual in that it will be managing its own biotechnology companies, as well as taking minority positions in others. Thus, it will be a player in biotechnology and an investment company.

Medica was formed in 1997. With its pre-IPO funds, Medica has already made two investments: in a wholly- owned subsidiary called Cytopia Pty. Ltd., and in Alchemia Pty. Ltd., in which it invested 16 percent.

Cytopia is investigating a breakthrough made by a team led by Andrew Wilks, a researcher at the Ludwig Institute for Cancer Research, in Melbourne. Wilks, director and head of research at Cytopia, and his team discovered a family of proteins named Janus Kinases, also known as JAKs.

The JAKs were found to be a key part of the complex signaling pathways between cytokine messenger molecules and the activation of a gene. By identifying molecules that interfere with that pathway, Cytopia researchers believe they will be able to treat inflammatory diseases, such as hay fever and asthma, food allergy and rheumatoid arthritis, among others.

Cytopia has licenses for the JAK proteins.

Alchemia has a developed technology for the production of carbohydrate-based molecules ¿ technology which, the company said, is superior to existing techniques in the growing field of producing carbohydrates to order. The company is expected to list independently on NASDAQ within a few years.

Medica has two other companies lined up for investment, including Xenome Pty. Ltd., which is investigating drug candidates found in, or based on, naturally occurring venoms or toxins. Areas which the resulting drugs may target include stroke, pain, Alzheimer¿s disease and urinary tract disorders.

The second company targeted for investment is Cytokine Mimetics Ltd., which is involved in the design and production of protein-based drugs with improved properties. Drugs being investigated include a replacement for the growth hormone and others to treat red blood-cell deficiencies, as well as a range of immune disorders.

Healey said that once Medica has made its investments in the companies targeted, it would probably have about $2 million left over, but he had ¿another eight deals on my desk.¿

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