Helicos BioSciences Corp. bought itself more time by tapping some old and new friends for cash.
The Cambridge, Mass.-based maker of genetic-sequencing equipment said Wednesday it sold slightly more than 4.3 million shares of stock to a group of existing and new investors, generating $9.4 million in net proceeds after expenses.
Participating in the private placement were Atlas Ventures, Flagship Ventures and Highland Capital, all located in the Greater Boston area; Versant Ventures of Menlo Park, Calif., also bought stock in the latest offering. All four firms are longtime Helicos stakeholders, taking part in various financing packages dating back to the company’s founding in 2003.
Absent a lucrative new partnership or an outright sale of the company, additional funding efforts are likely. The company said last month it does not expect to turn a profit for another two years and recently hired an investment bank to evaluate various strategies, including licensing pacts, joint ventures or partnerships along with future debt and equity offerings.
“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,” CEO Ron Lowy said in a prepared statement.
Helicos officials did not immediately identify any of the new investors, although it said that the four private equity firms — which already held a combined 69 percent of the company prior to the deal — along with Lowy purchased 1.03 million shares priced at $2.57 each. The named firms and Lowy also received warrants allowing them to buy an additional 680,000 shares over a five-year period, starting next March, for $2.61 a share.
The new investors got a slightly better deal, buying about 3.3 million shares at $2.24 apiece. They too got warrants to buy up to 1.64 million Helicos shares before March 2015 at the same $2.61-a-share price.
Helicos finished the quarter ended June 30 with only $8.4 million on hand and spent another $3.4 million by Aug. 14, when the company disclosed it had engaged Thomas Weisel Partners to advise the firm during ongoing talks with potential strategic partners. The San Francisco-based investment bank also acted as placement agent in the recent financing round, receiving about 6 percent of the gross proceeds.
Through the first six months of 2009, the company generated $1.1 million in sales of the Helicos sequencing system, billed as the world’s first DNA microscope. The sequencer uses fluidics and optics to process two flow cells simultaneously, performing strand synthesis and imaging at the same time.
Helicos said it recently sold sequencers to the Stem Cell Institute at Stanford University and to an unidentified biotech company in the Northeast. It also has an order — currently being revised — from the St. Laurent Institute, a private research facility loosely affiliated with the University of Maryland in Baltimore, generating about $830,000 in revenues for the company.
Sequencers also were placed for evaluation earlier this year at the Dana Farber Cancer Institute and the Cancer Center at Mass. General Hospital, both in Boston, and at the Ontario Institute for Cancer Research in Toronto. The company also donated a unit to the Broad Institute of MIT and Harvard University.