CardioDx, a 2012 Fierce 15 winner, revealed plans for an IPO worth as much as $86.2 million, becoming the latest diagnostics operation to gear up for the public markets.
The Palo Alto, CA company is perhaps best known for its Corus CAD blood test, a gene expression diagnostic designed to help rule out obstructive coronary artery disease. While CardioDx isn't profitable yet, the company won Medicare Part B coverage for the test in Aug. 2012. That's a major step for a new diagnostic test, and CardioDx has been steadily expanding sales. Also crucial: CardioDx partnered with India's Core Diagnostics earlier this year to bring the product to that country's surging healthcare market.
CardioDx launched Corus CAD in 2009 and is pursuing an IPO just as the Affordable Care Act becomes fully operational. With its focus on controlling costs and boosting the efficiency of care, the company frames its test as being ideally positioned to take advantage of the controversial healthcare reform law.
"As healthcare reform is implemented, we expect that there will be even more emphasis placed on avoiding procedures that have a low probability of changing a clinical decision, especially in large patient populations with high treatment costs such as the [coronary artery disease] market," the company said in its S-1 filing. "We believe the gatekeeper nature of the Corus CAD test is well suited for this evolving healthcare landscape." In other words, CardioDx is pitching the idea to investors that its test fits in well with healthcare reform and will be an important tool to help control costs by helping to eliminate treatment for patients that don't need it.
CardioDx's regulatory filing doesn't disclose how many shares it will offer or the proposed share price. But it will trade on Nasdaq under the symbol "CDX." CardioDx said it generated more than $2.4 million in revenue and lost more than $25.6 million in 2012, versus $1.5 million in revenue and a $25.9 million loss in 2011, according to its regulatory filing.
CardioDx wants to use the money to expand its commercialization efforts, boost research and development and keep the company running through anticipated losses as it seeks additional insurance reimbursement coverage options for Corus CAD. The last point in particular will be vital to helping Corus generate significant revenue and reach profitability down the line.
To date, CardioDx said it has delivered results for over 40,000 tests for Corus CAD.
CardioDx joins a growing list of med tech companies that have jumped on the IPO train along with their biotech peers. California's Biocept Laboratories filed IPO plans worth up to $23 million, and Veracyte recently disclosed a proposed IPO that could reach close to $75 million. Foundation Medicine went public in late September and raised $106 million, well above expectations. And LDR recently priced a $75 million IPO to bankroll its spinal implants. As well, insulin pump company Tandem Diabetes Care is pursuing a $100 million IPO.
- here's the full S-1
- here's FierceDiagnostics's take
Special Report: 2012 Fierce 15 - CardioDx
Editor's note: This story has been updated and expanded to include expanded information from CardioDx's S-1 regulatory filing, as well as additional background about other med tech initial public offerings.