BG Medicine (BGMD), a life sciences company developing novel diagnostic tests, priced its IPO on February 3rd, after cutting its expected price to $7 per share.
Business Overview (from prospectus)
We are a life sciences company focused on the discovery, development and commercialization of novel diagnostic tests based on biomarkers for high-value market opportunities in healthcare that we identify. We believe that our tests will provide clinicians with improved information to better detect and characterize disease states. We believe that this information may enable physicians to achieve better patient outcomes and contain healthcare costs. We focus on blood-based tests that we intend to sell, subject to regulatory clearance or approval, through various channels, including through leading diagnostic instrument manufacturers that will offer our tests as novel assays on their instruments. Our lead product, the BGM Galectin-3 test for heart failure, measures galectin-3 levels in blood plasma or serum. Galectin-3 is a protein that has been shown to play an important role in heart failure, which is a leading cause of death. Heart failure is a heterogenous condition that is characterized by the heart’s inability to pump blood efficiently to meet the requirements of organs in the body. According to the American Heart Association, heart failure affects an estimated 5.8 million Americans and we believe similar numbers in Europe. We have measured galectin-3 in eight controlled studies involving over 5,300 patients with heart failure. In these studies, galectin-3 was found to be a strong independent predictor of mortality or hospitalization. We believe that the data from these studies indicate that heart failure patients with high levels of galectin-3 have a more progressive form of the disease, which we refer to as galectin-3-dependent heart failure. We believe that our galectin-3 test will provide physicians with meaningful information that may lead to more clinically- and cost-effective management of heart failure patients.
Offering: 5 million shares at $7 per share. Net proceeds of approximately $15 million will be used to fund the launch of BGM Galectin-3, and approximately $8 million to fund the development and launch of AMIPredict and LipidDx.
Lead Underwriters: Lazard Capital Markets (LAZ)
To date, the company has not generated any revenue from sales of drugs. All the revenue has been derived from license fees and grants.
Established diagnostics companies, such as Abbott Diagnostics (ABT), Beckman Coulter (BEC), Roche Diagnostics, General Electric (GE), Alere (ALR), Ortho Clinical Diagnostics, Mitsubishi (MTU), Philips (PHG) and Siemens (SI) have expanded into the molecular diagnostics area to complement their legacy routine testing businesses. In addition, commercial laboratories with extensive service networks for diagnostic tests, such as LabCorp and Quest Diagnostics (DGX), have expanded their testing capabilities to include molecular diagnostics. Specialized laboratories, such as Genzyme Genetics and Myriad Genetics (MYGN), also offer molecular diagnostic testing services. We have identified a number of recent entrants to the field with competing technologies and approaches in molecular diagnostics. Companies that may compete with us in our current areas of focus, namely, cardiovascular disease, immune disorders and central nervous system disorders, include Athena Diagnostics, Atherotech, Celera Group (CRA), Dako, diaDexus (DDXS), Liposcience, QIAGEN (QGEN), Rules-Based Medicine, and XDx.