Investors shell out $619M in huge health-sector IPO stampede.

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The News:

Four biotechs and a genome-sequencing player firm grabbed their brass rings last week, cashing in with $619 million in total IPO funding. That means that with one week to go in the first half of 2019, we’ve seen 24 (by my count) new drug developers scoring a Nasdaq listing, and there are at least 3 more pricings totaling up to $1.025 billion expected this week.

Here’s a rundown on each of the newly public health-sector players to hit the Street the past week and those boogying the cash rain dance hoping to follow suit:

1) Akero Therapeutics Inc., an early-stage biotech developing therapies for nonalcoholic steatohepatitis (NASH) and other metabolic diseases, gained an upsized $92 million bonanza pricing 5.75 million shares at $16, the high end of its range. The proceeds will go toward clinical trials as well as manufacturing and other efforts to beef up the clinical pipeline of NASH and other metabolic drugs.

The South San Francisco, CA-based company’s lead candidate is AKR-001, an analog of a naturally expressed hormone called fibroblast growth factor 21 (FGF21) that regulates the metabolism of lipids, carbs and proteins. In previous studies in type 2 diabetics, AKR-001 was associated with substantial improvements in lipid metabolism and insulin sensitivity. A trial launched a few weeks ago. The estimated primary completion date is March 2020.

Akero Therapeutics was founded in 2017 and lists on the Nasdaq under the symbol “AKRO.” J.P. Morgan, Jefferies and Evercore ISI are the joint bookrunners on the deal. Shares closed the week up 23% to $19.70.

2) Elsewhere, Prevail Therapeutics Inc., an early-stage biotech developing gene therapies for neurodegenerative diseases, raised $125 million by offering 7.4 million shares at $17, the midpoint of the $16 to $18 range. The NYC-based biotech develops adeno associated viral-based gene therapies for patients with neurodegenerative disorders who have particular genetic profiles. Lead candidate is PR001 for the treatment of GBA1 mutation-positive Parkinson’s disease (about 7%-10% of total cases) and neuronopathic Gaucher disease (about 6% of all cases).

Prevail Therapeutics was founded in 2017 and lists on the Nasdaq under the symbol “PRVL.” Morgan Stanley, BofA Merrill Lynch and Cowen are the joint bookrunners on the deal. Shares closed the week off 15% at $14.50.

3) Atreca Inc., a preclinical biotech developing immunotherapies for solid tumors, raised $125 million by offering 7.4 million shares at $17, the midpoint of the $16 to $18 range. Existing investors had indicated an interest in buying up to $60 million on the IPO (48% of the deal).

The Redwood City, CA-based company’s lead drug candidate ATRC-101 represents a monoclonal antibody with a novel mechanism of action and target that has proven to reach in-vitro with the “majority of human ovarian, non-small cell lung, colorectal and breast cancer samples from multiple patients.” Atreca anticipates filing an Investigational New Drug (IND) application with the FDA in late 2019 and initiate a Phase 1b clinical trial in patients with solid tumors in early 2020.

Atreca was founded in 2010 and lists on the Nasdaq under the symbol “BCEL.” Cowen, Evercore ISI and Stifel are the joint bookrunners on the deal. Shares closed the week up 7 cents at $17.07.

4) Personalis Inc., which provides a genome sequencing platform for cancer drug development, raised $135 million by offering 7.9 million shares at $17, above the range of $14 to $16. The company originally filed to offer 6.7 million shares. Personalis bills itself as a lead player in the cancer genomics field, a hot but crowded space these days. Its ImmunoID NeXT platform, Personalis says, is “the first technology to enable comprehensive analysis of both a tumor and its immune microenvironment from a single sample and provides utility across immuno-oncology, targeted, and personalized therapies.” And that’s one of several products it plans to commercialize later this year.

Personalis lists on the Nasdaq under the symbol “PSNL.” Morgan Stanley, BofA Merrill Lynch and Cowen acted as joint book-running managers for the offering. Shares closed the week up 178% at $30.25.

5) Stoke Therapeutics Inc., a preclinical biotech developing RNA-targeted therapies for rare genetic diseases, raised $142 million by offering 7.9 million shares at $18, above the range of $14 to $16. The company had previously filed to offer 6.7 million shares.

Bedford, MA-based Stoke Therapeutics says it is pioneering a new way to treat the underlying causes of severe genetic diseases by precisely upregulating protein expression. They are developing novel antisense oligonucleotide, or ASO, medicines that target ribonucleic acid, or RNA, and modulate precursor-messenger RNA, or pre-mRNA, splicing to upregulate protein expression where needed and with appropriate specificity to near normal levels. They plan to submit an investigational new drug application for lead candidate STK-001 by early 2020 and expect to initiate a Phase 1/2 clinical trial in the first half of 2020.

Stoke was founded in 2014 and lists on the Nasdaq under the symbol “STOK.” J.P. Morgan, Cowen, and Credit Suisse are the joint bookrunners on the deal. Shares closed the week up 152% at $27.29.

6) Adaptive Biotechnologies Inc., which provides genetic immunosequencing tests used to diagnose and treat diseases, announced terms for its IPO.

The Seattle, WA-based company plans to raise $200 million by offering 12.5 million shares at a price range of $15 to $17. At the midpoint of the proposed range, Adaptive Biotechnologies would command a fully diluted market value of $2.1 billion. Adaptive Biotechnologies was founded in 2009 and booked $59 million in revenue for the 12 months ended March 31, 2019. It plans to list on the Nasdaq under the symbol “ADPT.” Goldman Sachs, J.P. Morgan and BofA Merrill Lynch are the joint bookrunners on the deal. It is expected to price this week.

7) Change Healthcare Inc., which provides healthcare revenue cycle management software and services, announced terms for its IPO on Friday.

The Nashville, TN-based company plans to raise $750 million by offering 42.9 million shares at a price range of $16 to $19. At the midpoint of the proposed range, Change Healthcare would command a market value of $5.2 billion. The Nashville, TN-based healthcare tech firm says it provides “data and analytics-driven solutions to improve clinical, financial and patient engagement outcomes in the US healthcare system.” It says its solutions are designed to improve decision making, simplify billing, collection and payment processes and enable a better patient experience.

Change Healthcare was founded in 2005 and booked $3.3 billion in sales for the 12 months ended March 31, 2019. It plans to list on the Nasdaq under the symbol “CHNG.” Barclays, Goldman Sachs and J.P. Morgan are the joint bookrunners on the deal. It is expected to price this week.

8) Morphic Holding Inc., which is developing oral small-molecule integrin therapeutics for various chronic diseases, announced terms for its IPO on Friday.

The Waltham, MA-based company plans to raise $75 million by offering 5 million shares at a price range of $14 to $16. At the midpoint of the proposed range, Morphic Holding would command a fully diluted market value of $450 million. The firm develops therapeutics based on proteins called integrins that facilitate cell-extracellular matrix adhesion. Lead candidate is MORF-720, an oral avb6 specific integrin inhibitor for the potential treatment of idiopathic pulmonary fibrosis, in development with partner AbbVie. An IND will be filed by year-end.

Morphic Holding was founded in 2014 and plans to list on the Nasdaq under the symbol “MORF.” Jefferies, Cowen, BMO Capital Markets and Wells Fargo Securities are the joint bookrunners on the deal. It is expected to price this week.

9) And finally, Dermavant Sciences Ltd., a Phase 3 biotech developing in-licensed therapies for dermatological diseases, postponed its IPO on Thursday.

It had filed to raise $100 million by offering 7.7 million shares at a price range of $12 to $14. Lead candidate is tapinarof, a topical cream for psoriasis and atopic dermatitis. It acquired global rights to the aryl hydrocarbon receptor modulating agent from GlaxoSmithKline in August 2018. Two pivotal Phase 3 studies were launched in May.

The London, UK-based company was founded in 2015 and had planned to list on the Nasdaq under the symbol “DRMT.” Jefferies, SVB Leerink and Guggenheim Securities were set to be the joint bookrunners on the deal.

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