WaferGen Biosystems, Inc. (OTC Bulletin Board: WGBS), a leading developer of state-of-the-art genomic analysis systems, today announced the closing of a $7.2 million registered direct offering. The amount raised includes $1 million from the Chairman and CEO, Alnoor Shivji, and approximately $500,000 in the aggregate from four other members of the board of directors of WaferGen. The funds will be used to expand the manufacturing, marketing, and sales of the SmartChip Real-Time PCR System to build on the early commercial success of the product.
"We are receiving these funds at an important time in the commercialization of our SmartChip System," said Shivji.
"First, WaferGen is poised for growth in personalized medicine where use of biomarkers is growing in drug development and clinical trials, leading to targeted therapies that use information about a person's genes and DNA to prevent, diagnose and treat disease. The timing is right for our platform as it will enable breakthroughs in biomarker discovery and validation that will result in the right drug for the right patient population.
"Second, we have seen early significant commercial success of our SmartChip Systems, SmartChips, and Services to biopharmaceutical companies, Academic Centers of Excellence and University Hospitals. To date, we have announced a total of ten Early-Access customers who have purchased systems and/or services, including four who have purchased SmartChip Systems for their research projects. This early success will support our primary focus on project-based programs targeting the top 20 biotechnology and pharmaceutical companies and the top 40 translational medicine centers.
"Third, the funding will help us to execute an aggressive global sales and marketing plan to meet our year-end sales goal of 10 to 15 SmartChip Systems, by concentrating on pharmaceutical and biotechnology companies involved with drug development and biomarker profiling. We are currently engaged in clinical research studies with key pharmaceutical companies to determine drug response. We will attend and present at approximately nine key scientific meetings and initiate a variety of market awareness programs. These funds will also help us to scale up chip and instrument manufacturing to meet demand and to establish strategic relationships," concluded Shivji.
WaferGen has issued to the investors an aggregate of approximately 6.0 million units at a price of $1.20 per unit, with each unit consisting of one share of common stock and a warrant to purchase 50% of one share of common stock exercisable at $1.55 per share. Subject to certain ownership limitations, the warrants are exercisable at any time on or after the closing date and will expire five years from the closing date. WaferGen has received net proceeds of approximately $6.7 million, after deducting placement agent fees and other offering expenses. The company expects to use the net proceeds for general working capital purposes in addition to the commercialization of the SmartChip System.
Rodman & Renshaw, LLC, a wholly owned subsidiary of Rodman & Renshaw Capital Group, Inc. (Nasdaq: RODM), acted as the placement agent and Gilford Securities as the sub-agent, for the transaction.
The common stock, warrants and the shares of common stock uZnderlying the warrants described above were issued under WaferGen's shelf registration statement on Form S-3, which was previously declared effective by the Securities and Exchange Commission on June 8, 2010.
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