GenPharm International claims to have the touch in milkinghuman proteins from its experimental transgenic dairy cows.But it apparently pulled its milking stool up to the initial publicoffering (IPO) market at the wrong time this spring.

The company filed an IPO prospectus in hopes of launching theoffering in April. It proposed selling 2.5 million shares at $11each, which would have raised close to $25 million for thetransgenic developer -- enough "to satisfy its capitalrequirements through at least 1993, according to its IPOprospectus filed last spring.

Now, with the IPO market temporarily cold, GenPharm ofMountain View, Calif., is among several biotechnologycompanies awaiting a change in market conditions, whileworking on its own dime. According to the prospectus, it had$15.5 million in cash and equivalents as of last Dec. 31.GenPharm reported a $3.7 million loss in 1991 on $2.1 millionin revenues.

If ever it was pinched for funds, the company is confident itcould raise any needed capital from a private equity placementor from expanding contract revenue from its existing productlines.

GenPharm's long-term strategy involves producing humanproteins from transgenic cows and developing transgenic micedesigned to generate human monoclonal antibodies. Transgeniccows are potentially the most efficient source of humanproteins, said Timothy Maier, GenPharm's chief financialofficer.

The human proteins could be used in nutritional products orpharmaceuticals, although GenPharm doesn't expect to startpreclinical testing of the latter until 1994, according to theprospectus.

Meanwhile, the company has tasted some success selling itstransgenic mouse for use in drug discovery and medicalresearch, where they can be used to mimic many aspects ofhuman physiology in toxicology and immunology studies.Although sales of the research mice have not been disclosed,GenPharm supplies four different models of the transgenicmice to a number of undisclosed organizations.

"Our transgenic mice may not be a home run like the transgeniccow and the human monoclonal antibody mouse, but theyprovided us with the cash flow we needed," Maier said.

The field for transgenic animals leaves plenty of opportunities,Maier said. With a broad market eager for transgenic mousemodels, his company is not yet feeling competitive heat.

Maier believes that GenPharm is the first company to developdairy cows capable of expressing human milk proteins in theirmilk. It is developing two human milk proteins -- lactoferrinand lysozyme -- to be used in products such as infant formula.The company signed a collaborative agreement with Bristol-Meyer Squibb in July 1990 to produce a human protein from atransgenic cow for a nutritional application.

GenPharm still expects to make its IPO debut when marketconditions improve, Maier said. Meanwhile, it is finding work.GenPharm announced this week that it received a $500,000grant from the National Institute of Health (NIH) for itstransgenic mouse program.

(c) 1997 American Health Consultants. All rights reserved.

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