Austin medical company Vermillion raises $17.6 million

Dec 23, 2013
Austin American Statesman

Austin-based medical diagnostics company Vermillion Inc. said Friday it has raised $17.6 million through stock warrant purchases by its investors


The investors – which included Oracle Investment Management and others – exercised their option to buy a combined 12.1 million shares of Vermillion common stock at $1.46 per share


Vermillion develops medical diagnostic tests in areas including oncology, hematology and women’s health


Stock warrants are securities that give the holder an option to buy a designated number of shares in a specific time period. These Vermillion stock warrants were issued in May as part on an equity financing transaction, the company said. Combined with the $17.6 million raised through the stock warrant purchase, the equity financing raised $30.9 million for Vermillion before transaction costs, the company said


Company officials said the $17.6 million in funding raised through the warrant purchase will be used to “increase test sales and improve reimbursement” for the company’s OVA1 product, which is a blood test for pre-surgical assessment of ovarian tumors for malignancy. It will also be used to “expand commercial opportunities in the U.S. and new markets and advance one or more next-generation ovarian cancer diagnostic tests,” the company said


Vermillion was founded in 1993 in California. It moved its headquarters to Austin in 2011. The company had $330,000 in revenue and a net loss of $2.3 million in the third quarter, according to securities filings


When reporting the company’s third-quarter financial results, Vermillion president and CEO Tom McLain said that in the fourth quarter, the company’s focus would be “on four key areas: collaborations to develop additional clinical and economic data, treatment guidelines, favorable coverage decisions and expanding access to our OVA1 test. We remain confident that the foundation we are building for our novel diagnostic test will support strong future growth.”


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