Medgenics raises $12.3m on AMEX

Already traded on London's AIM, the therapeutic protein company has now listed on the American Stock Exchange.

Medgenics Ltd. (AIM:MEDG) has dual listed on the American Stock Exchange, raising $12.3 million in an offering of shares and warrants.

On Friday, the company priced its offering on the AMEX of 2.46 million shares and warrants for the purchase of 2.46 million shares at $4.54 per share and $0.46 per warrant, for a price of $5 per unit of one share and one warrant. The company expects net proceeds of $10 million from the offering.

Roth Capital Partners and Maxim Group LLC are the underwriters. They have a 45-day over-allotment option to buy 369,000 units.

The company, based in Misgav in the Galilee, has developed a proprietary biological platform, the Biopump, which allows patients to produce, within their bodies and on a long-term basis, their own natural human protein therapy for the treatment of a range of chronic diseases, such as anemia and hepatitis C.

Medgenics originally planned to price the offering at $5-7 per unit, but lowered the asking price, which is still well above Friday's share price of ₤2.40 ($3.20) on London’s Alternative Investment Market (AIM), giving a market cap of ₤220,000.

The company's announcement of its plans to list in New York took many people by surprise, even as other people are still in shock from the company's IPO in 2007, when it raised $6.6 million at a company value of $25 million.

Medgenics has a development cooperation agreement with Baxter International Inc. (NYSE: BAX), which undertook to provide $4 million in financing for the clinical trial of Medgenics' product and $3 million if a trial of its Hemodure product for hemophilia works.

Medgenics' operates on the thin line between the impossible and bankruptcy. The company is developing technology with the potential to revolutionize medicine - generic engineering of cells from the patient's own bodies to produce missing proteins. The company is already conducting a clinical trial of its first product, Epodure, for the treatment of anemia in chronic kidney disease, which has yielded promising results. A third product is Infradure to treat hepatitis C.

Medgenics president and CEO Dr. Andrew Pearlman founded the company in 2000. The venture capital funds financing the company closed it down in 2003, but Pearlman reconstituted it. The company had $2.9 million in cash at the end of 2010, and $4.1 million in losses on zero revenue. The company has spent $42 million since 2000.

Published by Globes [online], Israel business news - www.globes-online.com - on April 10, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018