After a busy week in the IPO market for the week of November 4, just one biotech is scheduled to go public in the week ahead.
NASH biotech 89bio Inc. plans to raise $70 million by offering 4.4 million shares at a price range of $15.00 to $17.00. At the midpoint of the proposed range, 89bio would command a market value of $210 million.
89bio was founded in 2018, and the San Francisco, CA-based company plans to list on the Nasdaq under the symbol “ETNB.” BofA Securities and SVB Leerink are the joint bookrunners on the deal. Insiders intend to purchase up to $40 million of the IPO (57% of the deal). Nonalcoholic fatty liver disease (NAFLD) is a condition in which fat builds up in the liver. The cause of non-alcoholic fatty liver disease (NAFLD) is unknown. Risk factors include obesity, gastric bypass surgery, high cholesterol, and type 2 diabetes. Nonalcoholic steatohepatitis (NASH) is a type of NAFLD.
89bio’s target indication represents a multi-billion-dollar market with no FDA-approved therapy. As a result, there are many other NASH-focused biotechs, most of which are later-stage. NASH biotechs as a whole have not done well, save for June IPO, Akero Therapeutics Inc. (Nasdaq:AKRO), +28% from IPO. A holdover the week prior, 89bio delayed its offering due to a minor issue with its auditor’s disclosures to the SEC. (Ref: Renaissance Capital)
Here’s a look at the action for the week of November 4, 2019:
1) TELA Bio Inc., which sells soft tissue implants used in hernia repair and reconstructive surgery, raised $52 million by offering 4 million shares at $13, below the range of $14 to $16, to command a fully diluted market value of $142 million. The Malvern, PA-based med-tech firm develops tissue reinforcement materials, branded as OviTex, used in soft tissue reconstruction, including hernia repair, abdominal wall reconstruction and plastic/reconstruction surgery.
TELA Bio was founded in 2012 and booked $11 million in revenue for the 12 months ended June 30, 2019. The company recorded $7 million in sales for the 1H19, up 83% y/y. It lists on the Nasdaq under the symbol “TELA.” Jefferies and Piper Jaffray are the joint bookrunners on the deal. Shares closed the week up 3% at $13.35.
2) Elsewhere, CNS Pharmaceuticals Inc., an early-stage biotech developing therapies for brain cancer and other CNS tumors, raised $9 million by offering 2.1 million shares at $4, the low end of the range of $4 to $5, to command a fully diluted market value of $67 million. The Houston, TX-based company’s lead drug candidate is Berubicin, an anthracycline topoisomerase II inhibitor for the treatment of glioblastoma–a type of brain cancer that is currently considered incurable, according to management. Topoisomerase II is a critical enzyme enabling cell proliferation, and management believes that berubicin, based on limited clinical data, is the first anthracycline to cross the blood-brain-barrier and target cancer cells.
Glioblastomas are primary brain tumors that arise from astrocytes–the star-shaped cells making up the supportive tissue of the brain. CNS Pharmaceuticals was founded in 2017 and lists on the Nasdaq under the symbol “CNSP.” The Benchmark Company is the sole bookrunner on the deal. Shares closed the week up 14% at $4.57.
3) Centogene AG, which provides genetic tests for rare disease diagnostics and drug development, raised $56 million by offering 4 million shares at $14, the low end of the range of $14 to $16, to command a fully diluted market value of $289 million. The company provides a proprietary rare disease platform based on real-world data. Its platform includes epidemiologic, phenotypic and genetic data that reflect a global population and also a biobank of patients’ blood samples.
Centogene, which was founded in 2006, booked $45 million in revenue over the last 12 months. The Rostock, Germany-based company lists on the Nasdaq under the symbol “CNTG.” SVB Leerink and Evercore ISI are the joint bookrunners on the deal. Shares closed the week off 7% at $12.99.
4) Galera Therapeutics Inc., a Phase 3 biotech developing treatments for radiotherapy-induced oral mucositis, raised $60 million by offering 5.0 million shares at $12, below the range of $14 to $16. Insiders had indicated on buying up to $40 million of the IPO. At the offer price, Galera commands a fully diluted market value of $317 million. The Malvern, PA-based biopharmaceutical firm develops therapeutics that, it says, have the potential to transform cancer radiotherapy by virtue of less tissue toxicity and greater efficacy. Specifically, its drugs mimic superoxide dismutase enzymes which protect against the toxicity of radiotherapy-stoked superoxide, a highly reactive molecule that damages/kills cells.
Galera lists on the Nasdaq under the symbol “GRTX.” BofA Securities, Citi and Credit Suisse acted as lead managers on the deal. Shares closed the week unchanged at $12.
5) And Monopar Therapeutics Inc., which is developing therapies for chemotherapy-induced mucositis and cancers, postponed its IPO on Thursday. It had filed to raise $20 million by offering 2.2 million shares at a price range of $8 to $10. The company previously filed to raise $40 million in October but postponed the deal. The Wilmette, IL-based company was founded in 2014. It had planned to list on the Nasdaq under the symbol “MNPR.” JonesTrading, Aegis Capital Corp. and Arcadia Securities were set to be the joint bookrunners on the deal. The plan was to push the lead drug, validive, to Phase 3 later this year. According to its S-1, the company had slightly more than $5 million in cash and cash equivalents as of June 30.