AltheaDx, with Personalized Medicine Diagnostics, Files for IPO

San Diego-based AltheaDx, which uses diagnostic tests and bioinformatics to help doctors identify the optimal drugs based on a patient’s genetic make-up, plans to raise as much as $69 million in an IPO.

The company, which began operating in 2008, says in its IPO filing that it has used its IDgenetix technology to complete tests on more than 13,500 patient samples through the first nine months of the year. More than half of those were done in the third quarter.

AltheaDx has financed its operations primarily through private equity deals, debt, and by generating revenue from its R&D services to numerous biopharmaceutical partners, primarily in cancer diagnostics.

The company generated about $13.6 million in revenue through the first nine months of 2014, and has about $7.5 million in available cash. However, AltheaDx says it also has incurred significant operating losses since inception. At the end of September, it had an accumulated deficit of $19.2 million, and had borrowed $12.4 million against a $20 million credit facility held by Silicon Valley Bank.

According to the filing, IDgenetix assesses the genes involved in both the metabolism and pharmacological effect of numerous drugs. The company currently offers 13 tests for cardiovascular disease, neuropsychiatric disorders, and pain. Additional tests are under development in neurology and rheumatology.

The company offers its commercial IDgenetix services to multiple healthcare providers, and says reimbursement for its testing services comes from third-party payers, including Medicare and Medicaid, private health insurance plans, hospitals, and managed care organizations, as well as individual patients. Medicare patients accounted for 59 percent of all IDgenetix tests done through the first nine months of the year.

AltheaDx says its technology addresses the current “trial and error” process that doctors use to find the particular drug that works best for each patient. The diagnostic test identifies key metabolic enzymes and other applicable biological drug targets that vary among individuals. The company says its bioinformatics technology also screens for unfavorable metabolic interactions that can arise when multiple drugs are prescribed for the same patient.

Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.