Genoptix Inc., a provider of specialized laboratory and diagnostic services for community-based hematologists and oncologists, filed to raise $86.25 million in its initial public offering.
Until the Carlsbad, Calif.-based company prices, it will join the 11 other life science IPO hopefuls currently waiting in the wings. In the first quarter, 12 biotechs raised a total of $523 million though IPOs, with an average take of $43.6 million. Figures increased across the board in the second quarter, with 15 companies raising a total of $934 million, with an average take of $62.3 million. But the third quarter has, so far, suffered from the summer doldrums, with just two companies making it out in July: ImaRx Therapeutics Inc. and Vivalis. (See BioWorld Today, July 26, 2007.)
But Genoptix does have one thing many biotechs can't claim: revenues. The company provides services to help hematologists and oncologists diagnose, make treatment decisions and monitor the effectiveness of treatments in cancer patients.
Those services generated $24 million in revenues in 2006 and $10.7 million just in the first quarter of 2007. In fact, Genoptix said its revenues have grown at a compounded quarterly growth rate of 48 percent for the nine quarters ended March 31, 2007.
And Genoptix believes there's plenty of room for more growth, considering that it currently holds just 4 percent of the billion-dollar-plus bone marrow testing market. The company estimates that more than 300,000 bone marrow procedures and 200,000 blood-based tests for liquid and solid tumors are performed annually.
Genoptix's offerings center on Compass, a package that allows the company's hematopathologists to evaluate a sample, determine the appropriate tests and deliver a report back to the physician.
Compass includes a histopathology analysis to determine the nature and extent of the disease, six-color flow cytometry to characterize and measure cells, cytogenetics tests to reveal chromosomal abnormalities, polymerase chain reaction to follow progression of the disease and response to therapy and circulating tumor cell tests for metatstatic breast cancer patients.
Chart, Genoptix's other key offering, provides a similar suite of services designed to be repeated multiple times after diagnosis to track the cancer's progression and the effectiveness of treatments. While Genoptix said more than half of the patient samples it processes utilize the Compass or Chart packages, the company also offers its diagnostic services individually.
In addition to serving physicians, Genoptix offers services to pharmaceutical companies including assay development, support in defining clinical trial endpoints and patient eligibility and stratification analysis for clinical trials.
Genoptix hopes to use the proceeds from its offering to hire additional personnel, establish a second laboratory facility, expand backup systems, repay debt and pursue collaborations or acquisitions. Any remaining funds would go to working capital and general corporate purposes.
Lehman Brothers, Banc of America Securities LLC and Cowen and Company are underwriting the offering. Genoptix applied to list its common stock on the Nasdaq Global Market under the ticker symbol "GXDX."
In other financing news:
• La Jolla Pharmaceutical Co., of San Diego, filed a shelf registration for the future sale of up to $77 million in common stock, preferred stock and warrants. Proceeds will be used for general corporate purposes including clinical trials of lupus drug Riquent (abetimus sodium), regulatory activities, acquisitions, debt repayment, research and development or other uses. Riquent previously received an approvable letter from the FDA and is undergoing an additional Phase III trial. The company raised $34.8 million in a public offering in April. (See BioWorld Today, Oct. 18, 2004, and April 2, 2007.)
• Vyteris Inc., of Fair Lawn, N.J., raised $12.7 million in a private placement. Estimated net proceeds of $11.4 million will be used to support the third-quarter launch of LidoSite, an FDA-approved patch that uses low-level electrical energy to deliver an analgesic prior to venipuncture or superficial dermatological procedures. Vyteris also raised $23.1 million last fall to repay debt and prepare for the LidoSite launch.