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12:00 AM
Sep 30, 2013
 |  BioCentury  |  Finance

General stampede

Why investors piled into cancer sequencing play Foundation Medicine after IPO

While IPOs in the biotech bull run have been leaving some money on the table for new investors in the aftermarket, the reception for cancer sequencing company Foundation Medicine Inc. was over the top.

On its first day of trading last Wednesday, the share price nearly doubled and sent the biotech's market cap to almost $1 billion.

The move came after underwriters Goldman Sachs; JPMorgan; Leerink; and Sanford C. Bernstein sold the IPO above its proposed price range, and sold more shares to boot. After planning to sell 5 million shares at $14-$16, Foundation priced the deal at $18 late Tuesday. It sold 5.9 million and garnered a post-money valuation of $498.1 million.

The stock rose $17.35 (96%) to close at $35.35 on Wednesday, valuing Foundation at $960.5 million.

The shares closed the week up $17.65 (98%) to $35.65.

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