FREMONT, Calif., July 8 /PRNewswire-FirstCall/ -- WaferGen Biosystems, Inc. (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. , 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 underlying 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.
About the SmartChip Real-Time PCR System
WaferGen is commercializing the SmartChip Real-Time PCR System, and is currently offering the SmartChip System and the SmartChip Gene Expression Profiling Services as part of its revenue-generating Early-Access Program. The SmartChip System includes the 5,184-assay SmartChip, the SmartChip Cycler, and SmartChip Nanodispenser or Multi-Sample Dispenser for investigating candidate genes and microRNA panels for associate changes within disease states. The SmartChip Gene-Expression Profiling Services are provided to universities, research hospitals, pharmaceutical and biotechnology companies by WaferGen scientists at the company's headquarters facility in Fremont, Calif.
WaferGen employs a business model that generates revenue from both the sale of the instruments, and a recurring revenue stream from the sale of the SmartChip, similar to the "razor and razor blade" business model. In addition, the company is generating revenue by offering service for gene-expression profiling of thousands of genes using the SmartChip System in-house.
Based on collaborations established with leading research institutions, WaferGen believes that the SmartChip Real-Time PCR System is positioned as the platform of choice for biomarker discovery and validation. The system will provide a number of key ease-of-use features including content-ready chips with gene panels optimized for microRNA, cancer, and whole genome. WaferGen believes the SmartChip Real-Time PCR System will be the first platform to combine the high-throughput capability and cost efficiencies of existing microarrays, with the sensitivity and accuracy of real-time PCR.
About WaferGen
WaferGen Biosystems, Inc. is a leader in the development, manufacture and sale of state-of-the-art systems for genomic analysis for the life science and pharmaceutical industries. The company's headquarters are located in Fremont, Calif. Additional information is available on the company's Website at http://www.wafergen.com/.
Forward-Looking Statements
This press release contains certain "forward-looking statements". Such statements include statements relating to the expected sales to reach an installed base of 15 by the end of 2010, expected benefits and advantages of the SmartChip service for gene-expression research, the expected benefits and advantages of the SmartChip technology to other applications, the expected throughput levels of the SmartChip Real-Time PCR System and other statements relating to future events and are not historical facts, including statements which may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words.
Forward-looking statements are not guarantees of future performance, are based on certain assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond the control of the company. Actual results may differ materially from the expectations contained in the forward-looking statements. Factors that may cause such differences include the risks that: (i) the company may be unsuccessful in commercially developing its products or in achieving market acceptance of new and relatively unproven technologies; (ii) the company will need to raise additional capital to meet its business requirements in the future and the company may not be able to do so on reasonable terms or at all; (iii) the company's proprietary intellectual property rights may not adequately protect its products and technologies; and (iv) the company expects intense competition in its target markets, including from companies that have much greater resources than the company, and there can be no assurance that the company will be able to compete effectively. More detailed information about the company and the risk factors that may affect the realization of forward-looking statements is set forth in the company's filings with the Securities and Exchange Commission, including the company's Annual Report on Form 10-K/A for the year ended December 31, 2009 and the Quarterly Report on Form 10-Q for the quarter ended March 31, 2010. Investors and security holders are urged to read these documents free of charge on the SEC's web site at http://www.sec.gov/. The company does not undertake to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise.
Contact: WaferGen Mona Chadha mona.chadha@wafergen.com Or Joyce Strand joyce.strand@wafergen.com 510-651-4450
WaferGen Biosystems, Inc.
CONTACT: Mona Chadha, mona.chadha@wafergen.com, or Joyce Strand,
joyce.strand@wafergen.com, both of WaferGen, +1-510-651-4450
Web Site: http://www.wafergen.com/
