By midday, shares had plunged 19.3% to $1.55. Trading volume of 4 million shares exceeded its three-month daily average of 2.5 million.
The cardiovascular diagnostics specialist said it would offer 6.452 million shares of its common stock to the public for $1.55 a share. The underwriter will also be granted a 30-day option to purchase up to an additional 967,800 shares to cover any over-allotments.
Net proceeds are expected to be approximately $8.9 million.
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In a statement, Waltham, Mass.-based BG Medicine said it anticipates using the proceeds for operations including "advancing the commercialization of its cardiovascular diagnostic tests in the United States and Europe and developing new clinical claims and indications to expand its product pipeline."
Proceeds will be also used for other general corporate purposes, including capital expenditures, licensing of intellectual property, repayment of indebtedness and working capital.
The public offering is expected to close around April 8, subject to customary closing conditions.
Lazard Capital Markets is acting as sole book-running manager.