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RainDance Technologies Secures $35M in Debt Financing to Support Expansion

NEW YORK (GenomeWeb News) – RainDance Technologies said today that it has closed a structured debt financing with Capital Royalty Partners, providing it with up to $35 million to support the commercial expansion of its digital PCR and targeted DNA sequencing products.

RainDance CEO Roopom Banerjee noted in an interview with GenomeWeb Daily News that the new financing comes at a time of "significant acceleration across every facet" of the company's business – particularly its recently launched RainDrop droplet-based digital PCR platform.

"Our only barrier to growth there is the size of the sales force, and our ability to put the right commercial infrastructure in place to support that growth and manufacturing," Banerjee said. As such, the company plans to use the financing to double the size of its sales team over the next six months, as well as to develop new applications for digital PCR and expand its service and support capabilities for both digital PCR and targeted sequencing, he said.

In addition, RainDance recently moved its headquarters from Lexington, Mass., to a new facility a few miles away in Billerica, Mass., in order to double its space and triple its manufacturing capability, Banerjee said.

"We were rapidly outgrowing our own growth expectations," Banerjee said, noting that by the end of this year the company will have approximately doubled its revenues from the prior year to just shy of $20 million. "And we have very good visibility into 2014, where we expect anywhere between a 50 to 100 percent increase in revenues," he added.

The new financing follows a $20 million Series E equity financing that RainDance closed in April and which included Myriad Genetics as a strategic investor. RainDance and Myriad also in April signed an agreement under which RainDance is providing Myriad with its ThunderStorm target enrichment platform and related consumables for use in Myriad's myRisk sequencing-based hereditary cancer panel.

Myriad later disclosed in a filing with US Securities and Exchange Commission that its investment in RainDance totals $5 million.

RainDance also noted that this year it has collaborated with clinical researchers to demonstrate the use of the RainDrop digital PCR system to detect circulating tumor mutations directly from blood, urine, and cerebrospinal fluid for monitoring cancer progression; inked eight new distribution partnerships to support a fast-growing Asia-Pacific market; and launched a service partner program for research customers developing next-generation sequencing-based genetic research panels.

In light of this recent uptick in activity, Banerjee also said that for the first time the company is "more seriously entertaining" the notion of an IPO or positioning itself as an acquisition target for a larger company.

"We've been very fortunate … to have had a number of strategic partnering and acquisition opportunities over the years," Banerjee said. "We've decided for a variety of reasons – mostly due to confidence in our own execution capabilities – to go it on our own."

He added that RainDance is "intrigued and encouraged" by recent IPO successes in the biotech tools space, and is also "intently watching the IPO backlog."

"We certainly see RainDance as a company that either could be a public company or would fit great in a larger portfolio or channel in one of the larger companies," Banerjee said.