Pacific Biosciences found a pretty strong appetite from investors who want a piece of the future of super-fast, cheap genomic sequencing.
Menlo Park, CA-based PacBio has raised $200 million through its initial public offering, settling on a price of $16 a share, smack in the middle of its $15 to $17 expected range. The deal means that PacBio has now raised a staggering $570 million since its founding in 2004. The company, which will net about $186 million after paying underwriting fees and discounts, plans to trade under the NASDAQ symbol “PACB.”
The concept at PacBio, which I described in August when it filed IPO paperwork, is to make new gene sequencing instruments with enough oomph to deliver a complete human genome sequence in about 15 minutes and for a few hundred dollars. If this can be done on commercial scale, it would be truly remarkable, given the original Human Genome Project took 13 years and cost $3 billion, as PacBio pointed out in its prospectus.
It would also raise the ante in an intense competition with established instrument makers like San Diego-based Illumina (NASDAQ: ILMN), Carlsbad, CA-based Life Technologies (NASDAQ: LIFE), and another upstart attempting to go public—Mountain View, CA-based Complete Genomics. They are all moving at breakneck pace to bring down the cost of genome sequencing to below $10,000. As the price comes down, and more scientists gain access to the technology, the market for sequencing is thought to be getting much bigger. The DNA sequencing market is expected to grow from $1.2 billion in 2009 to more than $3.6 billion by 2014, according to figures from Scientia Advisors, which PacBio cited in its IPO filings.
The PacBio IPO is naturally important for the company, its employees, and the industry, but also for its venture investors. The big winners in the PacBio deal are Mohr Davidow Ventures (12 percent ownership), Kleiner Perkins Caufield & Byers (9.7 percent), Maverick Capital (9.1 percent), and San Diego-based Gen-Probe (8.6 percent).
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