Veracyte Obtains $40 Million in a Private Placement
Veracyte, the California-based lab that focuses on genomic tests to help make clearer decisions for lung, thyroid and other forms of cancer, has raised $40 million in a private placement. The company sold 4.9 million shares at a price of $8.15 per share to several venture capital firms, including venBio, Broadfin Capital, Camber Capital, Deerfield, […]
Veracyte, the California-based lab that focuses on genomic tests to help make clearer decisions for lung, thyroid and other forms of cancer, has raised $40 million in a private placement. The company sold 4.9 million shares at a price of $8.15 per share to several venture capital firms, including venBio, Broadfin Capital, Camber Capital, Deerfield, and Longwood Capital Partners, in late April. They represent both existing and new investors, Veracyte said in a statement. Veracyte said the money will be used to fund research and development, for product commercialization, and for working capital and general corporate purposes. The additional paid-in capital significantly beefs up Veracyte’s cash reserves. It had reported $25.8 million on hand at the end of March. In 2014, Veracyte reported robust growth. For the fourth quarter of 2014 ending Dec. 31, revenue was $12.2 million, up 78 percent in contrast to the $6.8 million in the fourth quarter of 2013. For calendar 2014, revenue was $38.2 million, up nearly 75 percent compared to full-year 2013 revenue of $21.9 million. However, it lost $8.1 million in the fourth quarter of last year and $29.4 million for 2014, both higher than in 2013. For 2015, the company forecast revenues of $48 to $53 million, another significant uptick. It did not provide any forecast for profitability. Veracyte launched its first commercial test, Afirma, in 2011. It is used to type thyroid cancers and suggest non-surgical courses of treatment. Veracyte said in a recent filing with the Securities and Exchange Commission that the test had helped patients avoid some 15,000 thyroid surgeries and $200 million in related medical expenses as a result. Veracyte recently launched Percepta, a molecular assay intended to provide clarity to patients with nodes on their lungs who have unclear results from a bronchoscopy. The intent of the test is to avoid invasive lung biopsies. Veracyte Chief Executive Officer Bonnie H. Anderson said in a statement that Percepta would complement recently issued federal guidelines that provide annual low-dose CT scans for about 8 million Americans who are considered to be at high risk for contracting lung cancer. The company also recently entered into a collaboration with GE, another Veracyte investor, to use its digital imaging technology to improve disease diagnosis. Takeaway: Veracyte has significantly beefed up its cash on hand as it releases a new test.