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GTG Technologies Eyeing $9.6M Raise

NEW YORK (GenomeWeb News) – Australian molecular diagnostics firm Genetic Technologies today announced plans to raise about US$9.6 million.

The fund raising will take place in three tranches and net proceeds will be used to expand US distribution of GTG's BrevaGen breast cancer test, and to complete additional studies to add new ethnic groups — Hispanic- and African-Americans — in order to expand the test's addressable market.

Funds will also go toward increasing market awareness of BrevaGen through "broader and more active key opinion leader and speaker programs"; increasing reimbursement for the test; and general capital.

In one tranche of the fundraising, GTG is placing 30.5 million new shares of its stock with institutional and "sophisticated" investors at A$.072 (US$.06) per share to raise A$2.2 million. The company said it has commitments for the placement from investors.

In another tranche, GTG will offer a share purchase plan to raise an additional A$3.0 million at an issue price of A$.072 per share.

It also has executed a term sheet to issue convertible notes to Ironridge Global to raise US$5.0 million as the last tranche of the fundraising. The notes to be issued to Ironridge will be convertible into new Nasdaq-traded American Depository Receipts at a fixed price of US$3.00 per ADR.

Lodge Corporate acted as lead manager on the fundraising, and Ladenburg Thalmann & Co. served as placement agent on the $US5.0 million notes offering.

"The additional funding, combined with our existing cash reserves and building recurring income streams, should provide the platform to create a vital and sustainable global molecular diagnostics company," GTG CEO Alison Mew said in a statement.