Lineagen Announces $3.5 Million Series C Round and Close of Series B Financing Lineagen Expects to Become Profitable in 2014 Based on Current Rates of Reimbursement and Sales of Current Commercial Offering
SALT LAKE CITY, Dec. 18, 2013 /PRNewswire/ -- Lineagen, Inc., an innovative molecular diagnostics company focused on complex, genetically linked disorders, announced today the Company has completed a $3.5 million series C round of financing, including $2.6 million in equity capital and $0.9 million in convertible senior subordinated notes. The financing was led by existing investors Signal Peak Ventures and Sanderling Ventures, with the participation of current investors PrairieGold Venture Partners and Mesa Verde Venture Partners and new investors Archipel Capital, University Venture Fund, Hatteras Funds, and KickStart Seed Fund. Lineagen also announced the Company has received multiple term sheets for multi-million dollar senior secured debt facilities, one of which the Company intends to close as part of this Series C financing. Additionally, Lineagen announced the conversion of $12.6 million in outstanding promissory notes into shares of Series B preferred stock.
Lineagen is a leader in providing physicians and patients with a fully integrated genetic testing, counseling, and developmental screening service to aid in the early diagnostic evaluation of individuals with ASD and other disorders of childhood development. Based on current reimbursement rates, sales, and favorable gross margins of Lineagen's customized proprietary commercial offering, FirstStepDx PLUS, and pursuant to the use of net proceeds of the Series C funding and anticipated loan facility, the Company expects it will accelerate the time to profitability to the first half of 2014.
Lineagen's Chief Executive Officer Michael S. Paul, Ph.D., said, "As a science-driven company, our paramount dedication is to the clinical community and to the families we serve. We now provide our FirstStepDx PLUS services to over 400 pediatricians across the country, and we have agreements with payors and provider networks to provide access to FirstStepDx PLUS to approximately 70 million covered lives. Lineagen has consistently attained high levels of reimbursement, with increased reimbursement levels being seen under the new reimbursement codes, attesting to the significant clinical benefit of our commercial offerings."
Dr. Paul continued, "We are grateful to the communities we serve and to our investors who have continued to support our programs and build our commercial presence and brand in the market. In 2014, we will seek to close an additional tranche in our Series C financing – up to $7 to $7.5 million – which we anticipate would allow us to launch new commercial offerings, including NextStepDx PLUS, a customized, proprietary next generation sequencing-based reflex test that is expected to significantly add to the current diagnostic yield of FirstStepDx PLUS; expand our sales team's ability to reach specialist physicians, and seek to ensure additional payer coverage. It's an exciting time for the Company, we are pleased with Lineagen's position in the market and achievements, and we look forward to further progress of our programs."
About FirstStepDx PLUS
Lineagen's FirstStepDx PLUS and related autism-risk screening services (www.mchat.org) have been developed with the specific intention of helping physicians, patients, and families navigate the diagnostic evaluation "odyssey" of individuals with autism spectrum disorders (ASDs) and other disorders of childhood development early and more efficiently. FirstStepDx PLUS includes genetic counseling, the most advanced, customized chromosomal microarray analysis (CMA) clinically available, and a detailed, personalized report created specifically for each individual's case. FirstStepDx PLUS is specifically designed to help parents, physicians, and other healthcare providers significantly shorten the time to clinical action, allowing access to proven clinical management and treatment approaches as early as possible. The customized and proprietary CMA platform incorporated into FirstStepDx PLUS was developed in collaboration with Affymetrix under the Powered by Affymetrix program. Further, Lineagen's FirstStepDx PLUS incorporates novel validated genetic variants recently featured in the publication of results of a 9,000-person genetic study by researchers affiliated with The Children's Hospital of Philadelphia (CHOP), the University of Utah, Golden Helix, Inc, and Lineagen (http://dx.plos.org/10.1371/journal.pone.0052239).
The FirstStepDx PLUS genetic test was the first such test to be available as a fast and painless cheek swab (FirstStepDx PLUS Buccal), eliminating the need for a blood draw. For more information about FirstStepDx PLUS, please call Lineagen at 888-888-OPEN (888-888-6736) or visit www.firststepdxplus.com.
Based in Salt Lake City, Utah, Lineagen's mission is to accelerate and enhance the diagnostic evaluation of medical conditions so that the best possible outcomes can be achieved for patients and their families. Our first commercial offering, FirstStepDx PLUS, provide physicians with a fully integrated genetic testing, counseling, and developmental screening service to aid in the diagnostic evaluation of individuals with ASD or other forms of developmental delay. In addition to our deep commitment to ASD and developmental delay, we have ongoing scientific programs in the areas of multiple sclerosis (MS) and chronic obstructive pulmonary disease (COPD).
For additional information, please visit www.lineagen.com.
Dr. Michael Paul
Burns McClellan, on behalf of Lineagen
SOURCE Lineagen, Inc.