Nanosphere Sets IPO Terms

NEW YORK (AP) – Nanosphere Inc., which makes a system for gene and protein testing, said Wednesday it plans to raise about $95 million in an initial public offering of 7 million shares of common stock, according to a regulatory filing.

In a filing with the Securities and Exchange Commission, Nanosphere said it expects the shares to price between $14 and $16 per share.

The company has also granted the underwriters the option to buy up to an additional 1.1 million shares to cover any overallotments.

Nanosphere filed a preliminary prospectus with the SEC in August, but did not set any terms.

Assuming a $15 offering price, Nanosphere expects proceeds of about $95 million. The Northbrook, Ill., company plans to use about $50 million of the proceeds to finance research and development and about $40 million to fund sales and marketing personnel and initiatives. Nanosphere said it expects to use the remainder of the net proceeds for working capital and general corporate purposes, which could include the acquisitions of other businesses, products or technologies.

Nanosphere is currently developing diagnostic tests for conditions including cancer, neurodegenerative, cardiovascular and infectious diseases, as well as tests for personalized medicine. The company anticipates submitting applications to the U.S. Food and Drug Administration for clearance of certain tests within the next 36 months, according to the filing.

For the six months ended June 30, Nanosphere reported a loss of $18.9 million, compared with a loss of $32 million in the first half of 2006. Revenue for the period rose 67 percent to $780,173 from $466,142.

Credit Suisse Securities is serving as the IPO's lead underwriter. Piper Jaffray, Leerink Swann and Allen & Co. are also serving as underwriters.

Nanosphere has applied to list its shares on the Nasdaq Global Market under the symbol “NSPH.”

peHUB Note: Nanosphere has raised around $80 million in VC funding since 2000, from firms like Brookside Capital Partners, Lurie Investments Bain Capital Ventures and Allen & Company.