Epocrates, Inc. (NASDAQ: EPOC) is closer to its IPO.  The company offers mobile drug reference tools to healthcare professionals and interactive services to the healthcare industry.  The terms have been set for its 5.36 million share IPO are $13.00 to $15.00 per share.

The company itself is selling 3,574,285 shares of common stock and the selling stockholders are selling an additional 1,785,715 shares. The company will receive none of the proceeds from the sale of shares of common stock by the selling stockholders.

Joint book-runners in the offering are J.P.Morgan and Piper Jaffray; co-managers are  William Blair and JMP Securities.  Epocrates granted the underwriters a 30-day overallotment option to purchase up to 804,000 additional shares of common stock from the company at the IPO price.

Its products are most commonly used on mobile devices at the point of care to help healthcare professionals make more informed prescribing decisions and boost patient safety. The company’s user network consists of over one million healthcare professionals, which its claims is over 300,000 or more than 45% of U.S. physicians.  It supports most mobile platforms: iPhone, iPod, iPad, Android, BlackBerry, Palm, and Windows Mobile.  The revenue model comes from providing healthcare companies with interactive services to communicate with its network of users and by selling subscriptions to premium drug and clinical reference tools.

In 2009, net revenue was $93.7 million versus $83.3 million for 2008; and revenues were $73.7 million for the nine months ended September 30, 2010 versus $66.2 million for the nine months ended September 30, 2009.

Income before taxes for 2009 was $14.4 million versus $13.9 million for 2008; income before taxes for the nine months ended September 30, 2010 was $3.3 million versus $8.2 million for the nine months ended September 30, 2009.

Not all holders have been listed but you will see there is a known list of owners and backers here.  The Goldman Sachs Group Inc. (NYSE: GS) is listed as a 16.1% owner before the offering (12.4% after); Sprout Capital owns 17% (11.8% after); InterWest owns 12.7% (8.8% after); Draper Fisher Jurvetson owns 10.4% (8.8% after).

• The Top 17 IPOs To Watch In 2011 is here

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JON C. OGG

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