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WaferGen Biosystems, Inc. (WGBS.OB) to Use $7.2M Registered Direct Offering to Supercharge SmartChip Roll Out

WaferGen Biosystems, Inc., – a pioneer in analytical systems which utilize emerging gene expression, genotyping and stem cell/cell biology research for biopharma and life science market applications, closed a $7.2M registered direct offering yesterday.

The Company has struck gold with what it believes will be rapidly adopted as the platform of choice for future genetic analysis and cell monitoring, because the SmartChip™ Real-Time PCR system is the first of its kind to offer unprecedented performance capabilities unmatched by existing technologies.

The SmartChip combines unmatched throughput with the cost-effectiveness of microarray applications, and the high-fidelity, accuracy and sensitivity of real-time PCR (polymerase chain reaction).

The funding raised includes $1M from Chairman and CEO, Alnoor Shivji, and $500k from the Board Members, all of which will be directly applied to facilitating the manufacture, marketing and sales of the SmartChip in order to capitalize on the system’s early financial success.

With ten Early-Access customers, from biopharma companies to University Hospitals, having already purchased systems and services, WGBS has a strong hand in the high-end of the market and will focus on project-based approaches to the top 20 biotech/pharmaceutical companies and top 40 translational medicine centers.

Shivji noted the excellent market position provided by this capital infusion, and the product’s potential to put the Company into the forefront of its venue, citing as proof its command of biomarker applications and its dramatic growth in personalized medicine – where the ability to analyze individual genetic material has opened up entirely new pathways for the prevention, diagnosis and treatment of multiple diseases.

Shivji pointed out that the timing was ideal for the SmartChip platform because it will fundamentally enable huge new breakthroughs in “biomarker discovery and validation that will result in the right drug for the right patient population”.

Shivji indicated that WGBS plans to aggressively market and sell the product globally, with a goal of selling up to 15 systems by the close of the year. WGBS will also concentrate specifically on biopharma companies working on biomarker profiling and drug development, and disclosed that the Company is currently engaged in drug response studies with key pharmaceutical firms.
With plans to present the technology at nine influential scientific meetings, as well as employ a broad spectrum marketing approach with a variety of programs, the Company’s intent – to scale up manufacturing output to meet imminent demand and secure strategic relationships – clearly demonstrates that it is ready to strike while the iron is hot.

The Company issued 6M units at $1.20 each (shelf registration statement on Form S-3, declared effective June 8 by the SEC), consisting of one share of common stock and one warrant to purchase 50% of one share of common stock at $1.55 (exercisable on or after closing date with a 5-year term, subject to certain ownership limitations), and has taken in roughly $6.7M minus placement agent fees and offering expenses. The agent of record is Rodman & Renshaw, LLC, a wholly owned subsidiary of Rodman & Renshaw Capital Group, Inc., and its subagent is Gilford Securities.

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