29 Nov 2013

Pacific Edge shares jump after rights issue over-subscribed

7:47 am on 29 November 2013

Shares in Pacific Edge jumped as high at $1.60 on Thursday after the cancer diagnostic company announced its rights issue was over-subscribed and it has signed up a third health network in the United States.

Pacific Edge had sought up to $20.5 million, including over-subscriptions, and received subscriptions for nearly $30 million worth of shares so some shareholders will receive scaled-back allocations.

The company says it has signed another large national health network in the United States to provide its Cxbladder test to detect bladder cancer to more than 8.6 million Americans.

The test uses a small urine sample rather than the invasive and expensive diagnostic techniques currently in use.

Pacific Edge says the agreement with Stratose and the other two networks are a significant part of its commercial rollout in the United States.

Chief executive David Darling says it would have been nice to have been able to accept more money, but the $20.5 million was the amount the board had decided the company needed.

He says it was the amount calculated to be necessary for the next two years for the sales and marketing programme in the United States and to bring forward the next two bladder cancer products which are targeted for release in 2014.

Mr Darling says obtaining the over-subscription was a very strong gesture of support.

Pacific Edge shares closed at $1.49, up 15 cents from Wednesday, valuing the company at $417.5 million.