Blacksburg company of Randal Kirk goes public, its shares nearly doubling in five days

After becoming Southwest Virginia's first billionaire with the sale a pharmaceutical startup in 2007, Randal Kirk has returned to Wall Street and is receiving a reception that is as warm as ever.

Intrexon, a synthetic biology company with deep ties to Southwest Virginia, went public on Thursday with an opening price of $16 a share.

Today, just five days later, that price has nearly doubled to $29.70.

The stock has performed well even though it's a shot in the dark for many investors. Intrexon is a long way from making profit and the research it promises could redefine entire industries. Intrexon sees a day when it could grow crops that are more resistant to drought, animals that grow faster, and microbes that can help create fuels.

But the success of the initial public offering comes as further proof that those playing the market are eager to stand behind Kirk, the company's CEO, and the unproven technology he bets on.

About 10 percent of Intrexon has been sold to the public for an estimated $160 million. Of that investment, $30 million was from Kirk himself.

According to Raman Kumar, a Virginia Tech investment management professor, Kirk has likely been a driving factor behind the stock's rise. He said investors watch Kirk's cues because they remember the success he has enjoyed while at the helm of Third Security, a firm that manages private equity and venture capital investments particularly in technology and life sciences companies.

Through Third Security, Kirk has picked a number of winners in which to invest, including New River Pharmaceuticals , which developed a drug for attention-deficit (hyperactivity) disorder. Kirk, then a longtime Dublin resident, famously pocketed more than $1 billion when that company sold in 2007.

Kirk now lives in Florida but maintains strong ties to the New River Valley. In 2009, he was named the CEO of Intrexon and has since focused on the emerging field of genetically modified plants and animals.

Intrexon is still in the development phase as it spent $64 million on research last year hoping to get one step closer to its big breakthrough. Since it was founded in 1998, it has racked up a total deficit of $363 million.

But the light at the end of the tunnel is the development of technology that would put the company at the forefront of gene modification.

It acquired a majority share of AquaBounty Technologies earlier this year, with hopes of joining forces to make genetically modified salmon a commercial reality. That project aims to produce a hybrid breed of fish that would be infused with genes from other species to make the animals grow twice as fast.

The company has lofty goals, but it all started with three graduate students at the University of Cincinnati in 1998.

It relocated to the Roanoke region in 2004 for a better business climate and financial support in a classic economic development narrative that shows the wisdom of planting seeds and hoping they'll sprout.

In the early 2000s the Carilion Biomedical Institute, a science-based affiliation of Carilion Clinic, Virginia Tech and the University of Virginia, was created to increase the number of biotechnology companies in Southwest Virginia. It offered scientific and business expertise to life sciences companies in development here or willing to locate to the area.

At the time, Intrexon was a seven-person startup called Genomatix Corp. Though it wasn't yet profitable, institute officials saw promise in co-founder Thomas Reed, a molecular geneticist, and his vision to cure disease and create jobs. Reed said at the time that the Roanoke-Blacksburg area was developing the sort of biotech-friendly community that was key to him, but lacking in Cincinnati.

Genomatix relocated into a newly built laboratory in downtown Roanoke's Warehouse Row business center and received local financing of $850,000 in connection with its move. It later moved to the Virginia Tech Corporate Research Center in Blacksburg, changed its name to Intrexon and bought the website address dna.com. The Virginia Tech Foundation, Carilion and Third Security became steady investors, pouring tens of millions of dollars into the company.

The company's main office is now in Germantown, Md. It has other facilities in Blacksburg ; Durham, N.C.; and San Diego and San Carlos in California. It has 142 employees primarily engaged in research and development.

"It's absolutely phenomenal to have one of our local companies do so well," former CBI manager of research Sam English said of last week's Intrexon stock sale.

The Intrexon IPO, when considered along with those of Radford-based New River Pharmaceuticals in 2004 and Roanoke-based Luna Innovations in 2006, "means we have a strong and vibrant technology community that really is reaching critical mass," said English, who runs Attention Point, a Roanoke health care information company. "The fact is we have a lot of talented people in our area and the fact that they are capable to move things forward, all the way through to IPO, is a terrific thing. That's what we want as part of our ecosystem."

Staff writer Jeff Sturgeon contributed to this report.

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