Making a virtue of low market cap

Whether it was intended or not, Anergen Inc.'s failure to gorge itself at the 1991-92 funding trough has enabled it to offer its first corporate partner a sizeable percentage of the company in a deal that could give ANRG almost four years of cash.

While the '91-92 funding window left many biotech companies with copious bank accounts, heavy dilution and bloated market caps, ANRG raised a modest $14 million (1.75 million shares at $8) in its October 1991 IPO. John Fara, president and CEO, said ANRG's T cell anergy technology was relatively unproven, which did not go unrecognized on the Street. "The investment community was somewhat skepical of T cell anergy and if we had broader exposure we could have raised more money," Fara said...