Helicos Biosciences, Running Low on Cash, Snaps Up $10M Lifeline
[Update: 09/16/09, 11:15 am] Helicos Biosciences has gotten a lifeline, at least temporarily. The Cambridge, MA-based maker of genetic analysis instruments which hired an investment banker two weeks ago to seek “strategic alternatives” as it ran low on cash, has raised $10 million from new and existing investors and CEO Ron Lowy. [The deal includes new and existing investors, not just existing investors.]
Helicos (NASDAQ: HLCS) got the money from investors that include Atlas Ventures, Flagship Ventures, Highland Capital Partners, Versant Ventures, and Lowy. The cash infusion comes about a month after Helicos disclosed in its quarterly report, on August 14, that it was down to its last $5 million of cash. That meant it needed to raise money in the next four months, given the company burned $11.3 million of its cash to operate the first six months of this year.
The company is hopeful that its gene sequencing machines—which compete with those from industry heavyweights like Life Technologies, Illumina, and Roche—will gain acceptance in the market in a hurry after they were first introduced last year. Demand is encouraging so far, Helicos says. The company’s tools are used at the Broad Institute of MIT and Harvard, Mass General Hospital Cancer Center, and Dana-Farber Cancer Institute. Last week, Helicos sold four of its systems to a research institute in Japan.
But Helicos makes it sound like it’s not out of the woods, even after raising $10 million. The company hired Thomas Weisel Partners earlier this month to help consider “strategic alternatives,” like more financing, or partnerships, to make sure the company doesn’t run out of money.
“We believe that raising this level of funds is appropriate given the recent demand for the Helicos Single Molecule Sequencing System while we consider our strategic alternatives,” Lowy said today in a statement.