TO ALL,
REGARDING THE ARTICLE FOLLOWING THIS STATEMENT,I BELIEVE DR. TROTMAN
MEANT THAT THIS YEAR (1999)WILL NOT BE PROFITABLE.HOWEVER STARTING THE 3rd QUARTER GENSCI WILL START MAKING MONEY(WILL BE IN THE BLACK).
MEANING STARTING THE YEAR 2000 THE COMPANY (GENSCI)WILL START GOING
IN THE BLACK(STARTING TO MAKE A PROFIT).
MAYBE THE COMPANY SHOULD CHANGE ITS NAME TO GENSCI.COM (JUST KIDDING)
PLEASE READ ARTICLE.
REGARDS,
JOSE
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A Globe History
SEARCH
Risk capital investment boosts bone biotech firm
GenSci Regeneration Sciences' injection
is one of the 56 disclosed deals of $2-million or more
that closed during the last quarter of 1998.
Friday, April 9, 1999
Dawn Walton
Toronto -- in
In 1992, Vancouver-area family medicine practitioner James Trotman and a colleague poured $50,000 into a small firm developing a product aimed at helping human bones regenerate.
The Seattle-based biotechnology venture was working on a demineralized human bone powder that could mean the end to painful hip surgery for some patients. This surgery is commonly required to harvest the bone needed to perform procedures such as spinal fusions or knee reconstructions.
"Traditionally, you would have hardware where you would use pins and screws . . . However, the thought of being able to use something that is biological that would grow bones is extremely appealing."
Dr. Trotman and his colleague also promised to raise another $1-million within a year. "It was visionary at the time, [the investment] was extremely high risk and I probably had brown hair," says Dr. Trotman, his coiffure now a distinguished grey.
Dr. Trotman is now chairman and chief executive officer of publicly traded GenSci Regeneration Sciences Inc. of Mississauga, a biotech company that has found support among venture capitalists.
Last year, GenSci received a $6.5-million investment from CI Covington Fund, MDS Capital Corp. and Royal Bank Capital Corp. This injection is included in a roundup of disclosed risk capital deals of $2-million or more compiled by Macdonald & Associates Ltd. of Toronto.
The 56 deals, which closed during the last three months of 1998, include investments by venture capitalists, mezzanine investors, merchant banks or buyout funds as well as royalty-based ones.
In the coming weeks, the Enterprise page will publish two more instalments of disclosed risk capital deals for the fourth quarter of 1998: those valued at between $750,000 and $2-million, and those of less than $750,000. This format will be used for future quarterly surveys.
Dr. Trotman, who works out of GenSci's U.S. division in Irvine, Calif., has relied on outside investment to help transform the venture from a pure research and development firm into a integrated commercial biotechnology company.
He hopes the $13-million in net investments GenSci captured last year will help the company take a bigger bite out of the global orthopedic and dental market for bone and tissue regeneration products, which was valued at $6.4-billion (U.S.) in 1997. The U.S. grafting market alone is valued at $600-million, he says.
In 1998, GenSci reported $16.3-million (Canadian) in sales, and last month alone, Dr. Trotman says, its revenue was $2.5-million.
Its bone grafting product has been used on about 20,000 patients and in more than 950 North American hospitals. GenSci's pharmaceutical division is developing products to treat and diagnose osteoporosis, which causes bone mass and strength to deteriorate.
GenSci has yet to turn a profit, but Dr. Trotman predicts that will change in about a year and a half.
The fourth quarter's three largest deals involved Quebec steel framework manufacturer Groupe ADF Inc., which received $20-million from venture capital investors; Juniper Lumber Co. Ltd., a New Brunswick-based forestry company, which received a $15-million quasi-equity injection; and Vancouver-based manufacturer Concert Industries Ltd. received $14-million in venture financing.
WHO'S INVESTING IN WHAT
Disclosed risk capital deals of $2-million or more in the fourth quarter, 1998, compiled by Macdonald & Associates Ltd.
Company Investors Fund type
Acorda Therapeutics MDS Capital (Agent: Haywood/ VC
Levesque Beaubien)
ADF Industries Lourdes Fonds de Solidarité VC
All Canada Express CCFL Mezzanine Partners Mezz
AltaGas Services Manvest Inc VC
Amteva Technologies BCE Capital Inc VC
Autodyne Machinery RoyNat Inc VC
Avocet Medical MDS Capital VC
Balmur Entertainment CI Covington Fund VC
Battery Plus RoyNat Inc Mezz
Betts Group Schroder Cdn. Buy-Out FUND II.MB
CIMTEK Automation Systems Orchard Capital Group & others.VC
(Agent:Shoniker & Assoc.)
Concert Industries Manvest Inc. and others VC
Consorcio Transmataro Fonds de Solidarité VC
Constructions Louisbourg Fonds de Solidarité VC
Corporation Financiere Brome Fonds de Solidarité VC
Cyberplex Mosaic Venture Partners VC
DBA Telecom Agent:Interface International
Direct Hit Mosaic Venture Partners VC
and others
Focus Automation Systems Bank of Monreal Capital Corp.,VC
Telesoft Ventures,Ventures West
GenSci Regeneration Sciences CI Covington Fund, MDS VC
Capital and RBCC
Great Canadian Rail Tour WOF VC
Groupe ADF Fonds de Solidarité VC
Hyd-Mech Group RBCC,VenGrowth Investment Fund VC
Hyperchip TechnoCap Inc. and others VC
Indian Motorcycle Co J.L. Albnright Venture VC
Partners, Triax and others
Innova Technologies VenGrowth Investment Fund VC
Input Technologies BDC, FESA and others VC
Insystems Technologies Bank of Montreal Capital VC
Corp.,VenGrowth Investment
Fund,Ventures West and others
Internet Secure Trillium Growth Capital Inc VC
and others
Inverpower Controls BDC, Bank of Montreal Capital.VC
Corp., Ventures West
Juniper Lumber Co CCFL Mezzanine Partners Mezz
Life Imaging Systems Sofinov, Working Ventures VC
LMDS Capital Wireless Technologies.VenGrowth Investment Fund VC
Look Communications CI Covington Fund VC
MACPOD Enerprises Cdn. S&T Growth Fund & others.VC
Manoir Richelieu Fonds de Solidarité VC
Media Synergy Bank of Montreal Capital VC
Corp.,McLean Watson, SOFTECH,
Ventures West
Minacom International Investissement Desjardins, VC
Telsoft Ventures and others
Mitchell's Gourmet Foods RoyNat Inc Mezz
Neuromed Technologies MDS Capital, RBCC and WOF VC
Neurotrophic Biosciences BDC, GeneChem Technologies VC
Venture Fund and Sofinov
Nth Power HQ CapiTech Inc VC
Pangea Systems MDS Capital VC
Playdium Entertainment CI Covington Fund VC
Quantum Biotechnologies BioCapital Inc., VC
Fonds de Solidarité
SSiG Group BCE Capital Inc. and others VC
Stephenson's Rent-All CCFL Mezzanine Partners Mezz
Synsorb Biotech MM Venture Partners VC
Telexis Corp RBCC and others VC
Terragen Diversity BDC, Biotechnology Investments.VC
Ltd., CMDF, MDS Capital & others
Timestep RBCC and others VC
UltraVision CMDF VC
Vaxis Therapeutics CMDF, UMDI & Working Ventures.VC
Vitamin Superstore LLC Clairvest Group Inc VC
Vorton Technologies Infosoft, SEC and VC
Fonds de Solidarité
XWave Solutions MT&T Innovation VC
-**
Amount
invested
Company City Stage.$mln Business
Acorda Therapeutics Hawthorne, N.Y.EX $4.4.Biotechnology
-spinal cord injury
ADF Industries Lourdes Lachine, Que.N/A 4.5.Steel
framework maker
All Canada Express Mississauga EX 11.0.Cargo and
courier airline
AltaGas Services Calgary EX 5.0.Natural Gas
Amteva Technologies Richmond, Va.EX 2.5(US).Messaging
systems
Autodyne Machinery Mississauga BU N/A.Industrial
automation for auto industry
Avocet Medical Campbell, Calif.ES 3.1.Self-testing
diagnostic products
Balmur Entertainment Toronto ST N/A.Entertainment
company
Battery Plus Mississauga ES 6.0.Battery
retail chain
Betts Group Colchester, Eng.BU 3.0.Packaging
materials
CIMTEK Automation Systems Oakville, Ont.ON 10.0.Computer
integrated manufacturing
Concert Industries Vancouver EX 14.0.Airlaid
products
Consorcio Transmataro Montreal N/A 5.2.Electric
transportation line
Constructions Louisbourg St-Eustache, Que.N/A 9.2.Construction
Corporation Financiere Brome Montreal N/A 3.4.Short-term
financing
Cyberplex Toronto EX 2.8.Internet
services
DBA Telecom Vancouver EX 2.0.Tele
communications
Direct Hit Wellesley, Mass.EX 3.0.Internet
search engine
Focus Automation Systems Waterloo, Ont.EX 6.5.Automated
surface inspection
GenSci Regeneration Sciences Mississauga EX 6.5.Dental,
orthopedic regeneration
Great Canadian Rail Tour Vancouver EX 2.0.Rail trips
through Rockies
Groupe ADF Terrebonne, Que.N/A.20.0.Steel frame-
work maker
Hyd-Mech Group Woodstock, Ont.EX 5.0.Metal-cutting
band saws
Hyperchip Greenfield Park, Que.ST 5.3.Massive
parallel semiconductor
Indian Motorcycle Co Toronto EX 3.8.Motorcycle
manufacturing
Innova Technologies Toronto EX 2.0.Dental
implants
Input Technologies Toronto ES 5.2.Direct input
interfaces for graphic data
Insystems Technologies Markham, Ont.EX 11.6.Insurance
software
Internet Secure Oakville, Ont.ES 3.0.Internet
credit card processing
Inverpower Controls Burlington, Ont.EX 6.0.Custom
software, electronic hardware
Juniper Lumber Co Juniper, N.B.EX 15.0.Lumber and
wood products
Life Imaging Systems London, Ont ES 5.0.Ultrasound
imaging products
LMDS Capital Wireless Technologies.Ottawa ES 4.3.Broadband
wireless technology
Look Communications Milton, Ont ST N/A.Broadcasting
systems
MACPOD Enerprises Toronto ES 2.0.Instep
couplers for athletic footwear
Manoir Richelieu Pointe-au-Pic, Que.N/A 4.3.Resort hotel
Media Synergy Toronto EX 4.0.Software -
multimedia
Minacom International Montreal ES 5.0.Performance
management software
Mitchell's Gourmet Foods Saskatoon BU 5.0.Meat
processing and packaging
Neuromed Technologies Vancouver ST 2.5.Biopharma-
ceutical company
Neurotrophic Biosciences Toronto ST 2.0.Biotechnology
therapeutics
Nth Power San Francisco N/A 3.7.Investment
fund
Pangea Systems Oakland, Calif.EX 7.7.Bioinformatic
tools and software
Playdium Entertainment Toronto EX N/A.Interactive
entertainment
Quantum Biotechnologies Montreal ES 2.5.Molecular
biotechnology
SSiG Group Montreal EX 2.5.Remote
sensing; satellite data
Stephenson's Rent-All Mississauga EX 10.0.Small tools
and equipment rental
Synsorb Biotech Calgary EX 3.0.Biopharma-
ceutical products
Telexis Corp Ottawa EX 6.5.Digital video
service networks
Terragen Diversity Vancouver ES 4.9.Biopharma-
ceuticals
Timestep Kanata, Ont ES 3.3.Network
security solutions
UltraVision Calgary EX 5.9.Contact
lenses
Vaxis Therapeutics Kingston ST 2.4.Products to
treat sexual dysfunction
Vitamin Superstore LLC Washington ST 4.6.Vitamin
retailer
Vorton Technologies Nepean, Ont EX 3.5.Financial
applications software
XWave Solutions St. John's EX 2.0.IT solutions
-**
Note: VC - Venture Capital; Mezz - Mezzanine; MB - Merchant Bank/Buyout Fund; ES - Early Stage; ST - Startup; EX - Expansion; BU - Buyout
Source: Macdonald & Associates Ltd.
Report on Business Company Snapshot is available for:
GENSCI REGENERATION SCIENCES INC.
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