Albuquerque-based Exagen Diagnostics Inc. has won approval for up to $25 million in debt equity from Capital Royalty Partners in Texas.
Exagen, a homegrown, venture-backed medical diagnostics firm, will use the money to grow its marketing team and expand sales nationwide for the company’s flagship product – a proprietary test for lupus and other autoimmune illnesses, said President and CEO Ron Rocca.
“We’re now fully capitalized,” Rocca told the Journal. “We shouldn’t need to raise any more money after this.”
The company, which launched in 2002, uses proprietary computational software to identify key genomic biomarkers to better diagnose and treat disease. Exagen released its lupus test in January 2012, plus an expanded variant of that diagnostic that allows doctors to screen for other diseases with symptoms similar to lupus, such as fibromyalgia.
Since last year, sales of the product, called Avise SLE, have grown at a phenomenal clip, Rocca said. From January-September of this year, the company received nearly 6,000 orders for the test, up from about 2,000 in all of 2012. That represents a huge jump in revenue, since the standard price for the lupus exam is $648, and $988 for the expanded exam.
“The growth rate for our lupus product has just been on a tear,” Rocca said. “We’ve gotten a lot of good feedback from doctors using the test, and from patients who have benefited.”
Exagen probably will only draw down about $15 million of the $25 million in debt equity approved by Capital Royalty, since the company is about to close on another $10 million in venture capital. The company had previously raised nearly $35 million in venture funding from local and national investors, including Sun Mountain Capital, which manages direct investments in start-up companies made by the New Mexico State Investment Council.
All the existing investors are contributing to the new round, said Brian Birk, managing partner at Sun Mountain, which previously committed about $6 million to Exagen.
“We’re very excited about the progress it’s making,” Birk said.
Exagen now employs 43 people, including 15 administrative and customer-service professionals in Albuquerque, 15 lab technicians at a testing clinic in California, and 13 salespeople spread across the country. With the new funding, it will expand the sales team to 27, and add five more people in Albuquerque, Rocca said.
The company will also release a new product to monitor lupus patients for flare ups of the illness, which is what leads to internal organ damage in patients, Rocca said.