Bacterin aims for profitability with $25M in new financing

Bacterin International ($BONE) grabbed $25 million in new non-dilutive financing this week from OrbiMed Advisors. The maker of antimicrobial coatings for medical devices and bone graft material will use the cash to advance growth plans and finally become profitable.

And this could be the last major financing the Belgrade, MT company seek, with chairman and CEO Guy Cook noting in a statement that it doesn't "anticipate the need for additional working capital in [its] pursuit of achieving profitability."

An initial $20 million goes to Bacterin right away, though that got whittled down to a $10 million net after paying down existing debt and other related fees. Bacterin gains the remaining $5 million, assuming it reaches revenue goals before Dec. 31, 2013, according to the deal announcement.

Bacterin has been pushing hard to grow its commercial revenue. The company generated $30.1 million in net revenue in 2001, for example, nearly double the $15.4 million in revenue from 2010. Red ink has also declined substantially. Bacterin booked a $3 million net loss in 2011, down from nearly $19.5 million in net losses in 2010. Bacterin has used distribution agreements, positive clinical studies, more hospital accounts and other initiatives to expand its market reach. Even acquisitions have been part of the company's long-term strategy, such as the company's purchase of device distributor Robinson MedSurg in 2011.

Thanks to increased sales, the upward revenue trend continued in the first six months of 2012, when Bacterin reeled in $16 million in revenue, up from about $13.5 million during the same period the previous year. The first 6 months of 2012 produced a small net loss however--about $316,000, versus $4.5 million in net income in 2011. Cook said in a statement that the numbers should accelerate through the rest of the year, thanks to expectations of a wound care market spike, higher inventory levels and planned clean room expansion for the third quarter.

- read the release

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