CORRECTED – UPDATE 2-Pacific Biosciences files for $200 mln IPO

(Corrects projected size of DNA sequencing market in 2014 to
$3.6 billion from $2.6 billion and clarifies that Scientia
Advisors is a consulting firm, in paragraph 13)

* Expects to raise $200 million in IPO

* Says applied for Nasdaq listing under symbol “PACB”

* Says J.P. Morgan, Morgan Stanley among underwriters

By Liana B. Baker

NEW YORK, Aug 16 (BestGrowthStock) – Pacific Biosciences of
California Inc filed on Monday to raise up to $200 million in a
U.S. initial public offering, becoming the latest company vying
for a piece of the fast-growing market for human genome
sequencing technology.

The life sciences company designs machines to speed up DNA
sequencing in labs. Pacific Biosciences is looking for money to
help fund the commercial launch of its equipment, which it
plans for early 2011.

The U.S. Department of Energy Joint Genome Institute and
Monsanto Co (MON.N: ) are among those that have ordered Pacific
Biosciences equipment, according to the filing.

The company is looking for capital to boost manufacturing
operations and to finance research.

The decade-old company, based in Menlo Park, California,
has never turned a profit. Pacific Biosciences said it had
orders in its backlog totaling $15 million and it had operating
expenses of $88 million in 2009.

The company’s losses for the six months ended June 30 grew
to $63 million from $35.1 million a year earlier. It reported
revenue of $1.2 million for the six months ended June 30, all
of which came from U.S. government grants.

Chief Executive Officer Hugh Martin has been diagnosed with
cancer and he may not be able to continue with the company.

Pacific Biosciences’ equipment can be used for clinical,
agricultural and drug research, food safety, biofuels and
biosecurity applications.

The company expects future revenue to come from products
like its PacBio RS, which analyzes single molecule biochemicals
in real time with a special lens.

Macquarie Capital analyst Jon Groberg said Pacific
Biosciences has the potential to be the first company to hit
the market with new sequencing technology that can provide labs
with better data, but competitors will be closely on its

“PacBio will have to find a niche,” Groberg said. “People
are a little less impressed with them given the rapid advances
in technology that companies like Illumina are making.”

Prices for genome sequencing equipment have been falling as
companies like Illumina Inc (ILMN.O: ), Life Technologies Corp
(LIFE.O: ) and others compete to get their lower-priced machines
on the market. Complete Genomic Inc, anther life-sciences
company that produces similar sequencing technology, filed for
its own IPO of up to $86.3 million on July 30.

The market for sequencing products is expected to grow in
the next few years. In 2009, the industry was estimated at $1.2
billion and it could increase to $3.6 billion by 2014,
according to consulting firm Scientia Advisors.

Pacific Biosciences executives own 46 percent of company
shares. The largest outside shareholders are Mohr Davidow
Ventures, which owns 12 percent of shares, and KPCB Holdings
Inc, which owns about 10 percent.

JPMorgan, Morgan Stanley, Deutsche Bank Securities and
Piper Jaffray are arranging the IPO.

The company intends to list its common stock on Nasdaq
under the symbol “PACB” (PACB.O: ).

The filing did not disclose how many shares the company
planned to sell or their expected price.
(Reporting by Liana B. Baker, additional reporting by Suzannah
Benjamin in Bangalore; Editing by Maju Samuel and Gerald E.

CORRECTED – UPDATE 2-Pacific Biosciences files for $200 mln IPO