Restructuring efforts in 2010 and 2011 greatly slashed employment at the company over the last two years. At the end of 2011, Rosetta Genomics had 22 employees, seven of whom were in Philadelphia. That's down from a total of 72 full-timers at the end of 2009.
Rosetta Genomics said it planned to use the proceeds from the latest offering to finance work on its line of microRNA-based diagnostics to identify tumors. The money could be used for other purposes, including working capital, acquisitions, research and development, and repayment of future debt.
Life-sciences firms typically consume lots of capital and run up big losses in an effort to get their products approved by regulators. Having accumulated a deficit of $85 million since its founding, Rosetta Genomics reported a loss of $8.83 million, or $17.40 per share, on revenue of $103,000 in 2011. Its
shares closed Friday
down 19 cents, or 4.4 percent, at $4.13.
Echo Therapeutics, which moved its corporate headquarters in May 2011 to Center City from Franklin, Mass., will be able to borrow up to $20 million from Platinum-Montaur Life Sciences L.L.C., of New York. The company will use the debt financing to commercialize its Symphony needle-free glucose-monitoring system.
Under the terms of the commitment letter, Echo can borrow up to $5 million at 10 percent interest per year. The amount of that five-year loan could increase up to $15 million based on Echo's attaining certain regulatory and clinical study milestones.
In addition, Echo will issue to the investment firm known as Montaur four million warrants that carry an exercise price
of $2 per share over the next five years as well as one million five-year warrants for each $1 million borrowed. (The exercise price of those warrants, which depends on the market price of Echo stock when the company borrows funds, would range from
$2 to $4.)
Echo, which had 29 employees as of Dec. 31, had tapped Montaur for previous financing during 2011. According to Echo's most recent proxy statement, Montaur owned 5.97 million shares, or 9.99 percent of the company's outstanding shares, as of April 13.
Contact Mike Armstrong
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