Light Sciences Oncology (LSO; Snoqualmie, Washington), a developer of light infusion cancer therapy, is preparing to go public next week with an initial public offering (IPO) of 5.25 million shares, expected to be priced between $14 to $16.

LSO, spun off from parent Light Sciences Corporation in October 2005, is developing its flagship product, Light Infusion Therapy (Lit_x).

The company plans to use about $71.2 million in anticipated proceeds from the sale for clinical trials, preclinical costs, development costs to make treatments marketable, working capital and general corporate purposes.

Lit_x is a treatment for solid tumors, in which a flexible light-emitting diode (LED) is inserted into a tumor, followed by an injection of LS11 (talaporfin sodium), a light-activated drug. Once the LED activates LS11, molecular oxygen is converted into singlet oxygen, killing tissue within the LED’s scope and shutting down the blood supply to the area.

The treatment is designed for use on three types of cancers: hepatoma (liver cancer), metastatic colorectal cancer, and Gioma (brain tumor). It is designed for repeated use on previously treated cancers or tumors for which the treatment alternatives have limited efficacy.

The drug is still undergoing testing.

Treatment of patients with hepatoma has begun in a Phase III trial, the final trial required by the FDA. Patient treatments in a Phase III trial for metastatic colorectal cancer and a Phase II trial for glioma are scheduled to begin in the second half of 2006. A Phase III trial for glioma is scheduled to begin in early 2007.

The company’s competitors could include GlaxoSmithKline, Amgen, Imclone Systems, Genentech, Introgen Therapeutics and other pharmaceutical and biotech makers of cancer drugs or medical devices.

The company said its stock has been approved for listing under the symbol LSON on the Nasdaq. The IPO’s underwriters are Cowen & Co., Wachovia Securities, Jefferies & Co. and Thomas Weisel Partners.

Avista Capital Partners (New York; Houston), a private equity firm, reported it has committed to purchase up to $50 million in MedServe (Houston) to fund a national consolidation of small operators in the medical waste industry.

MedServe provides medical waste removal and destruction and related environmental services to hospitals, healthcare clinics, doctors’ offices and other generators of medical waste. It also offers mobile processing as an alternative to the traditional collection, transfer, hauling, treatment and disposal methodology for servicing the medical waste customer.

MedServe was formed in 2005 by the merger of Med-Shred (Houston) and Enserv (Bellaire, Texas). The company is led by Roger Ramsey, Med-Shred’s former CEO and chairman, and Mike Fields, Enserv’s former CEO and chairman.

“Avista’s extensive experience in the consolidation of fragmented industries, both as operators and as investors, will be a great asset to us as we pursue our acquisition strategy,” said Ramsey.

MedServe services hospitals and smaller quantity medical waste generators across the Southern, Southeastern and Midwestern U.S.

In other financing activity:

• Novare Surgical Systems (Cupertino, California), the developer of RealHand instruments for minimally invasive surgery, reported the closing of a $16 million private placement of its Series D preferred stock.

Point Judith Capital and Tudor Investment led the financing and were joined by existing investors Thomas Fogarty, MD, Channel Medical Partners, Canaan Partners, Asset Management and new investor Deerfield Partners.

Gina Raimondo, a partner at Point Judith Capital, has been elected to Novare’s board, bringing board membership to six.

Kerry Pope, Novare’s president/CEO, said, “We are now in a position to advance our commercialization plan for RealHand instruments. In doing so, Novare will be offering the first high dexterity (HD) instruments, a completely new category of technology for minimally-invasive surgery. The dexterity and freedom of movement that RealHand instruments provide will facilitate more advanced General laparoscopic procedures such as Gastric Bypass, and Colectomy. Moreover, GYN laparoscopic surgeons will soon have superior technology to approach the approximately 600,000 hysterectomy procedures performed in the U.S.”

RealHand instruments are the very first full range of motion hand-held laparoscopic instruments, according to the company. Developed with the EndoLink mechanism, RealHand technology is designed to mirror the surgeon’s hand direction with the added benefit of tactile feedback. As such, when the surgeon’s hand moves in one direction, the instrument tip exactly follows.

Unlike any other surgical device, RealHand instruments offer complete 7 degrees of freedom of movement in a hand-held instrument and with no need for additional hardware. Moreover, RealHand will enable surgeons to perform more difficult maneuvers that otherwise cannot be completed with traditional rigid instruments. RealHand instruments make it easy to actively manipulate and complete tasks regardless of whether the instrument is positioned over, under, or around structures.

RealHand instruments will provide for greater dexterity and control around critical structures and vasculature. The increase in range of motion will lead the way for development of new surgical approaches and techniques. RealHand instruments have received FDA 510K clearance.

Novare Surgical Systems was founded in 1999 to develop devices for cardiac surgery. RealHand was developed entirely at Novare Surgical and represents, it said, a shift in the company’s focus toward devices for minimally invasive surgery.

• Clarient (Aliso Viejo, California), which bills itself as a technology and services resource for pathologists, oncologists and the pharmaceutical industry, reported receiving $5 million in financing from GE Healthcare Financial Services to support the working capital requirements of Clarient’s diagnostic services business.

“This financing will provide Clarient with immediate access to the capital we need to support the quarter-over-quarter double-digit growth our business has experienced since launching our diagnostics services business in the fourth quarter of 2004,” said Ron Andrews, Clarient’s president/CEO. “We believe this financing also allows us to dedicate more resources to the development of novel tests and capabilities which will ensure our services remain the most innovative in our product space.”