By Mary Welch

Igen International Inc. raised $35 million in a private placement to help support the continued launch and marketing of the M-Series high-throughput screening system, as well as other programs.

The private placement involved 5 percent subordinated convertible debentures due 2005. The debentures are convertible into Igen common stock at $31 per share, which represents a 10 percent premium to the average closing price for a 25-day trading period prior to the financing. As part of the financing, Igen, of Gaithersburg, Md., also issued warrants to purchase 282,258 shares of common stock at $31 per share.

The placement involved about 1.1 million shares, which represents about 6 percent of the company. Prior to this placement, the company had about 17.2 million fully diluted shares outstanding. Two institutional investors participated in the financing.

"The M-Series is a major product launch and one of the key uses of this placement is to keep the product going forward," said George Migausky, Igen's chief financial officer. "We started shipping the product this summer and each quarter we are seeing the results of sales and as well as from our reagent rental plan."

The company has estimated that revenue for the reagent test kits could exceed $1.2 billion annually. Under this plan, Igen provides the instrument in exchange for a commitment to purchase a certain number of tests.

The M-Series, a second-generation product to the Origen Analyzer, allows for the performance of large drug-candidate screens at a high level of versatility, accuracy and sensitivity, the company said. The M-Series is based on the electrochemiluminescence module, is much smaller than the original Origen system, and gives the ability to array multiple modules. Among its attributes is its ultra-sensitivity, ease of developing new test procedures and the versatility to perform different types of analysis, including nucleic acids and proteins, the company said.

Among those currently using the M-Series are Merck & Co. Inc., of Whitehouse Station, N.J.; Pfizer Inc., of New York; Abbott Laboratories, of Abbott Park, Ill.; and Amgen Inc., of Thousand Oaks, Calif.

Igen raised $30 million through a seven-year debt financing deal less than a year ago. Those proceeds were used in part to launch the M-Series. (See BioWorld Today, March 24, 1999, p. 1.)

"That deal involved no equity," Migausky said. "It was a pure debt deal with John Hancock [Mutual Life Insurance Co. of Boston]. This financing will get us through the next couple of years."

IGEN's stock (NASDAQ:IGEN) closed Wednesday at $39.125, down 37.5 cents.