Medical Test Maker Venaxis Raises $18.4M, Files for FDA Approval

4/9/14Follow @MichaelXBD

Venaxis, a small medical diagnostics company in Castle Rock, CO, has raised $18.4 million through a public offering that closed Monday.

Venaxis (NASDAQ: APPY) is developing a protein biomarker-based blood test doctors can use to diagnose whether a patient has acute appendicitis. The test, known as APPY1, is intended to be used in emergency rooms to rule out whether a patient has developed the condition.

The point of the APPY1 test is to keep patients with symptoms of appendicitis but who actually have some other condition from undergoing additional tests such as CT scans or surgery. Venaxis believes patients, especially children, adolescents, and young adults (which are the categories of patients the test is being marketed for), would benefit from more conservative treatment.

Venaxis sold 8,335,000 shares of its common stock at $2.40 per share. The company also gave underwriters a 30-day option to purchase up to 1,250,250 shares of common stock to cover any over-allotments. Canaccord Genuity was the book-running manager for the offering and Craig-Hallum Capital Group was the lead manager.

Venaxis said in a release it would use the $18.4 million for general working capital while it awaits FDA approval and to continue improving the test and to commercialize the test in Europe.

Venaxis has received approval to market APPY1 in Europe, but getting FDA approval for the test has taken longer than expected. In late March it filed a 510(k) premarket submission with the agency following a positive pivotal trial.

Venaxis was formed in 2000 and operated as AspenBio Pharma until changing its name in December 2012. The company has seen its share of ups and downs, including negative results in trials and missed targets for commercialization.

The market capitalization of the company is now around $68 million. Venaxis reported a net loss of $12.1 million for the fiscal year that ended Dec. 31. This is the second time in less than a year Venaxis has used a public offering to raise cash. Last May, Venaxis raised $14.4 million.

Michael Davidson is the editor of Xconomy Boulder/Denver. He covers startups, venture capital, clean tech, energy, aerospace, telecoms, and whatever else happens above 5,280 feet. Contact him at mdavidson@xconomy.com. Follow @MichaelXBD

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