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Life Sciences Roundup

Exa, GI Dynamics planning initial offerings

Xconomy.Com / August 8, 2011

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The IPO market seems to be heating up, but will Boston be left behind? Two Massachusetts companies are trying to do their part, joining Kayak, Carbonite Inc., and others that have filed papers to go public.

The latest ones are GI Dynamics Inc., a medical device maker targeting obesity and diabetes, and Exa Corp., which makes simulation software to help automakers test automotive aerodynamics.

Lexington-based GI Dynamics has filed paperwork in Australia for an initial public offering of between $85 million and $102 million. Shares won’t be issued until Aug. 11, at the earliest.

Starting in 2008, Xconomy profiled GI Dynamics’ efforts to test and gain regulatory approval for its experimental intestinal liner, which limits absorption of calories and nutrients, as well as subsequent developments.

Investors include Advanced Technology Ventures, Cutlass Capital, Domain Associates, Johnson & Johnson Development, Polaris Venture Partners, and Seedling Enterprises.

Burlington-based Exa told the Securities and Exchange Commission it plans to raise up to $86.25 million in its IPO. Exa makes software for modeling complex fluid flow, which can be applied to problems of aerodynamics, wind noise, and heat management in cars and trucks.

The company says it is profitable; annual revenues have increased for 17 consecutive years. Investors include Fidelity Ventures and Boston Capital Ventures.

Gregory T. Huang

Mara Aspinall, founder and former chief executive of Waltham-based On-Q-ity, is moving on to become president of Ventana Medical Systems, an Arizona division of the health care giant Roche that focuses on cancer diagnostics. The appointment is effective next month.

Aspinall is well known in the diagnostics world, having served as president of the genetic testing unit of Cambridge-based Genzyme. On-Q-ity, started in 2009, focuses on molecular diagnostics for cancer. Its website still lists Aspinall as a founder and director, but makes no mention of a successor (or a search for one).

Xconomy profiled On-Q-ity last summer and earlier this year, when the company formed a strategic alliance with LabCorp to help commercialize its technology for detecting circulating tumor cells in the blood.

“My career has been about asking what is the greatest need for patients. The greatest need for patients today is in increasing the efficacy of treatments available now,’’ Aspinall said at the time. “We’ve made such progress with new drugs, we need to use diagnostics to improve the information the physician has if we want to improve how we use those drugs.’’

Gregory T. Huang

Amid all the recent comings and goings and CEOs changing jobs - see Rick Reidy of Progress Software Corp., Mara Aspinall of On-Q-ity, and others - one person flew under the radar: Stéphane Bancel, until last month chief executive of bioMérieux Corp., a microbiology and diagnostics firm in France. Don’t let the accent fool you, though; Bancel is a Boston guy. He’s been in town since 2007, and he’s here to stay, which is a big deal for the biotech community.

BG Medicine Inc., a Waltham diagnostics company, has appointed Bancel executive chairman of its board of directors. Bancel is also chairman of Knome Inc., a personal genomics start-up in Cambridge. (bioMérieux is an investor in Knome.) Bancel is also involved with ModeRNA, also of Cambridge, a stealthy therapeutics start-up backed by Flagship Ventures.

Bancel had been chief executive of bioMérieux since the beginning of 2007. The billion-dollar company, which has been around since 1963, specializes in molecular diagnostic systems for health care, food safety, and industrial applications, such as detecting salmonella in food preparation areas or bacterial infections acquired in hospitals. It has about 1,500 US workers, including at a small office in Cambridge.

“After five years I wanted to move to the start-up world,’’ Bancel said.

Beyond that, he has not said much about his plans. But it would not be surprising if he spent the next part of his career focused on a start-up at the intersection of diagnostics and pharmaceuticals.

Last month, before he left bioMérieux, he sat down for an interview about the future of diagnostics. Molecular diagnostics is evolving rapidly, he said, thanks to faster and cheaper genetic sequencing and analysis and new testing approaches. And it’s changing the whole business, he said.

As Bancel put it, diagnostics used to be full of commoditized offerings from many companies. It also used to require scale: a big testing platform to do lots of similar tests, employing lots of scientists and staff. But now it’s moving “closer to a pharma business,’’ he said. What’s more, he thinks advances in diagnostics and life sciences together will “transform pharma’’- something we’ll start to see within five years, he said.

Of course, the falling cost of genome sequencing is also disruptive. How does Bancel see that trend affecting health care? His answer presumes we will get our whole genomes sequenced rather than pay for separate genetic tests.

“You will even keep your genome on a USB key, or your iPhone or whatever, and as you grow older or as you develop disease, you’ll get your genome sequenced again to understand what has changed,’’ he said.

Gregory T. Huang

Beacon Endoscopic, a Newton medical device company founded in late 2008, has closed $5 million in Series B financing from MVM Life Science Partners, based in London and Boston. The company also said it received new capital from existing angel investors.

Beacon has developed a fine-needle aspiration system for endoscopic ultrasound and endoscopic bronchial ultrasound; the system has FDA clearance for endoscopic ultrasound use and is expected to be available in the fourth quarter of this year.

Beacon Endoscopic is led by chief executive Peter Rogal and cofounders Brian Tinkham and Christopher Thompson.

■A Cambridge personal genomics company has raised $5 million from one investor in a round that could eventually total $20 million. Launched in 2007 by the famed Harvard geneticist George Church, Knome Inc. offers wealthy consumers the chance to have their entire genomes sequenced and analyzed. But as prices for such services have plummeted over the last few years, the once-profitable company has struggled to get back in the black.

This report was compiled by the editors of Xconomy, an online news website focused on the business of technology and innovation. For more New England coverage, visit www.Xconomy.com/boston.