Anatomic pathology firm hopes proposed sale of stock will bring in up to $150 million
Anatomic pathology company Aurora Diagnostics, Inc., of Palm Beach Gardens, Florida, just announced a new credit facility that will give it access to as much as $335 million should all conditions be met. Aurora Diagnostics hopes to raise $150 million from an initial public offering (IPO) of its stock, for which it filed registration documents in April.
Aurora Diagnostics was founded in June 2006, by former Ameripath, Inc., executives James New and Marty Stefanelli and was originally funded by Summit Partners and GSO Capital Partners. Over the past four years, Aurora Diagnostics says it has acquired 17 pathology practices. Its revenue for 2009 totaled $171 million, with EBIDTA (earnings before interest, depreciation, taxes, and amortization) of $28 million and net income of $9 million.
Health insurers not eager to establish coverage for new molecular diagnostic assays
Navigating the pathway to successful commercialization of new genetic tests and molecular diagnostic assays has proven tricky. While scientists work quickly to bring new and better clinical laboratory testing tools to the market, health insurers work at a much slower pace to issue coverage guidelines and establish reimbursement for these new diagnostics tests.
“Successfully moving a genetic test from the research bench to the clinical laboratory takes much more than an understanding of the science,” stated Rina Wolf, Vice President of Commercialization Strategies for Consulting and Industry Affairs, XIFIN Inc., of San Diego, California. “Competition for coverage and reimbursement by health insurers is fierce. Often, the molecular diagnostic tests that win the best coverage decisions by payers are those proprietary tests backed by companies and laboratories with the most effective business plans.”