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Last fall, executives at GPC Biotech AG, a Munich-based biotechnology company that develops anticancer drugs, decided the time was right to make the leap across the Atlantic. With more than 50% of its employees based in the U.S.-stationed its research labs in the major biotech centers of Princeton, N.J., and Waltham, Mass.- coupled with a promising drug in development, GPC Biotech knew its future was increasingly in the U.S. Still, there were substantial hurdles, including the rocky stock markets, a thicket of Sarbanes- Oxley regulations and competition from world-class biotech companies- not to mention the task of finding bankers who understood all of the above and demonstrated a knowledge of GPC Biotech's place in the world.
In June, the company pulled the trigger. GPC Biotech, which had gone public on the Frankfurt Stock Exchange in 2000, listed on the Nasdaq, raising $70.2 million, according to Thomson Financial. At the same time, it came out with a rights offering in Germany to existing holders of its shares there, raising an additional $39.8 million, according to Thomson. Goldman Sachs was bookrunner and Lehman Brothers joint lead manager; Pacific Growth Securities and West LB acted as co-lead managers.
About 50% to 60% of the proceeds are going to fund additional late-stage clinical trials for Satraplatin, a drug that treats advanced prostate cancer and that received fast track approval from the Food and Drug Administration in November 2003.
GPC Biotech's chief financial officer, Mirko Scherer, who got his MBA from Harvard University and worked for the Boston Consulting Group before joining the biotech company in 1997, spoke with IDD about the company's decision to reach out to a new group of investors and about how it selected its bankers.
IDD: What was the deciding factor in the firms you chose?
Scherer: We didn't have a beauty contest with 10 to...