Capital Royalty provides $28m loan

Houston-based private debt firm Capital Royalty has provided a non-dilutive loan facility of up to $28m to Good Start Genetics, a genetic screening company.

US-based molecular diagnostics firm Good Start Genetics has secured a non-dilutive loan facility for up to $28 million from private debt firm Capital Royalty.

Houston-headquartered Capital Royalty specialises investments in healthcare intellectual property, through royalty bonds, secured debt, revenue interests and traditional royalty monetisations.

The new loan will be used to roll out Good Start Select, a system that couples can use to get screened for genetic diseases before they decide to have children.

The proceeds will also be used to support the company’s long-term corporate growth initiatives for next-generation sequencing (NGS) based carrier screening platform, it said in a statement.

The financing brings the total the firm has raised to date to $60 million since it was first founded by Don Hardison in 2007.

The company had already raised $32 million in venture capital funding following two rounds of fundraising.

In 2010, it raised $18 million through a Series A round backed by a number of biomedical and pharmaceutical specialists, including OrbiMed Advisors, Safeguard Scientifics, and SV Sciences. In April 2012, the firm went on to fundraise an additional $14 million Series B round from the same group.

Hardison, who now works as the chief executive of Good Start Genetics, believes the new debt financing package will place the firm in a “strong financial position to grow, taking us far beyond our projected 2013 profitability and cash flow operating goals”.

Charles Tate, chairman and founder of Capital Royalty, predicts “the unique next-generation sequencing based technology, applicability of GoodStart Select in large and growing markets” will have “significant long-term growth potential”.