EndoChoice files for $115m Nasdaq IPO

The market is wide open for companies with significant sales.

US-based medical device company EndoChoice has submitted a prospectus for raising $115 million. The company valuation for the offering is expected to be around $500 million. The company markets a large number of products for treatment of the digestive tract. Its flagship product is an endoscope developed by Israeli company Peer Medical, which was merged into EndoChoice in 2013. The development center in Israel has 70 employees. The underwriters for the issue are William Blair, Bank of America Merrill Lynch, JP Morgan, and Stifel.

EndoChoice's revenue totaled $61.4 million in 2014, up 22% and 79%, compared with 2013 and 2012, respectively. The company posted $16.7 million in revenue in the first quarter of 2015. The company lost $53.6 million in 2014 and $15.3 million in the first quarter of this year. The largest Israeli shareholder in the company is Accelmed, controlled by Mori Arkin and Dr. Uri Geiger. Agate Medical Investments LP, controlled by Dani Naveh, also has a stake in the company. The largest shareholder in EndoChoice is US fund Sequoia Capital.

EndoChoice was founded in 2008 by Mark Gilreath, formerly VP marketing at Israeli company Given Imaging, in order to develop better solutions for digestive medicine. The main product in digestive medicine is the endoscope. The company sought a breakthrough endoscope, and found Peer Medical, founded by Avi Levy, a cofounder of Sightline Technologies, sold to Stryker for $150 million. Peer Medical's endoscope has a camera angle of 330 degrees, instead of 170 degrees. A broader photograph makes it possible to diagnose more cancerous and pre-cancerous polyps.

The market for offerings has been open to pharmaceutical companies for the past two years, but medical devices companies have been less successful, assuming that they were in the pre-sale stage. Companies with significant sales, on the other hand, like EndoChoice, have had a better reception. Such companies include spinal column company K2M, cardiology company Trivsascular, and even Israeli esthetic surgery company Lumenis Ltd. (Nasdaq: LMNS), for example, whose offerings were in the range at which EndoChoice is aiming.

BiondVax and Outbrain headed for Wall Street offerings

BiondVax Pharmaceuticals Ltd. (TASE:BNDX), which is developing a universal vaccine for a broad variety of influenza types, has published a revised prospectus for a parallel offering on Nasdaq that slightly increased the amount it is seeking to raise, from an $11.5 million maximum, including the green shoe option for underwriters, to a $12.3 million maximum.

The lead underwriter is Aegis. BiondVax's TASE market cap is NIS 38.8 million, and its Nasdaq flotation is expected in the coming days.

Internet company Outbrain is also continuing its preparations for an anticipated Wall Street offering, appointing Yuval Ben-Itzhak as its CTO. The company previously reported that it had submitted a confidential prospectus to the US Securities and Exchange Commission (SEC) for an offering at a company value of $1 billion. Outbrain deals in content recommendations for web surfers, and its personalized recommendation product is installed on leading sites, including CNN, Le Monde, ESPN, and the New York Post. Ben-Itzhak was CTO at AVG for five years, and CTO of cybersecurity company Finjan.

At Outbrain, Ben-Itzhak will head a team of developers in devising innovative solutions for content websites and advertisers. The company says that he brings with him vast experience in adapting development teams and products to companies in advanced growth stages.

Published by Globes [online], Israel business news - www.globes-online.com - on May 7, 2015

© Copyright of Globes Publisher Itonut (1983) Ltd. 2015

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