Despite clashes over trade sanctions pending resolution with China and threats of war with Iran escalating to nerve-wracking heights, confidence in the US market for health-sector initial public offerings apparently can’t be dented. As of today, Jan. 6, 2020, the rush to seek new public funding has seen $450 million worth of registered new filings and another with terms set forth for a pricing possibly this week. Just one registration was withdrawn.
Here’s the hot health-sector IPO action to start off the new year:
1) I-Mab Biopharma Co. Ltd., a Phase 3 biotech developing antibodies for cancer and autoimmune diseases, announced terms for its initial public offering. The Shanghai-based company plans to raise $100 million by offering 7.4 million shares at a price range of $12 to $15. At the midpoint of the proposed range, I-Mab Biopharma would command a market value of $778 million.
The company–which has raised more than $400 million in the last three years–has a shrewd strategy for biologic development: it first conducts its proof-of-concept trials in the US and works towards getting FDA clearance for in-human studies. The data generated are then used to advance clinical development in China. Eventually, after the experimental drug has been clinically validated in the US, the company retains Chinese rights for further development and commercialization–while retaining the option to out-license globally.
I-Mab’s approach could allow Chinese patients to access treatments concurrently or soon after their market approvals elsewhere, particularly since Chinese officials have carved out a pathway for the fast-track approval of drugs supported by solid overseas clinical data and granted priority reviews. I-Mab Biopharma was founded in 2014 and booked $6 million in revenue for the 12 months ended September 30, 2019. It plans to list on the Nasdaq under the symbol “IMAB.” Jefferies and CICC are the joint bookrunners on the deal. It is expected to price on Thursday, January 16.
2) Elsewhere, Arcutis Biotherapeutics Inc., a Phase 3 biotech developing topical therapies for common skin diseases, filed on Monday, Jan. 6, with the SEC to raise up to $100 million in an IPO. Lead candidate is ARQ-151 (roflumilast cream) in Phase 3 development for plaque psoriasis. The company in-licensed exclusive global rights to the PDE4 inhibitor from AstraZeneca PLC in July 2018. The Westlake Village, CA-based company was founded in 2016 and plans to list on the Nasdaq under the symbol “ARQT.” Arcutis Biotherapeutics filed confidentially on September 9, 2019. Goldman Sachs, Cowen, and Guggenheim Securities are the joint bookrunners on the deal. No pricing terms were disclosed.
3) Avadim Health Inc., which sells topical treatments for immune, muscular, and skin health, filed on Thursday with the SEC to raise up to $50 million in an IPO. Avadim says it develops products that target the institutional care and self-care markets. Currently marketed brands are: Theraworx pre-saturated towelettes, foams and sprays, Combat One pre-saturated towelettes and Phuel pre-saturated towelettes. The Asheville, NC-based company was founded in 2007 and booked $44 million in sales for the 12 months ended September 30, 2019. It plans to list on the Nasdaq under the symbol “AHI.” Raymond James, SunTrust Robinson Humphrey and Oppenheimer & Co. are the joint bookrunners on the deal. No pricing terms were disclosed.
4) 1Life Healthcare Inc., a membership-based health clinic operator backed by The Carlyle Group and Alphabet, registered up to $100 million in an IPO. The San Francisco, CA-based company, also known as One Medical, has developed a membership-based primary care platform that provides around-the-clock access to digital health services paired with in-office care in convenient locations. It currently has approximately 397,000 members and 77 physical offices across nine US markets. The company was founded in 2007 and booked $257 million in sales for the 12 months ended September 30, 2019. It plans to list on the Nasdaq under the symbol “ONEM.” 1Life Healthcare filed confidentially on October 18, 2019. J.P. Morgan, Morgan Stanley, Allen & Company, Citi, Piper Jaffray, Wells Fargo Securities, and William Blair are the joint bookrunners on the deal. No pricing terms were disclosed.
5) Black Diamond Therapeutics Inc., a Phase 1 biotech developing small molecule tumor-agnostic cancer therapies based on its proprietary Mutation-Allostery-Pharmacology technology platform, filed on Friday with the SEC to raise up to $100 million in an IPO. Lead candidate is BDTX-189, designed to inhibit mutant kinases that affect the epidermal growth factor receptor (EGFR) and the tyrosine-protein kinase ErbB-2 (HER2) but with a more favorable safety profile than current ErbB kinase inhibitors. A Phase 1/2 clinical trial should launch in H1. The Cambridge, MA-based company was founded in 2014 and plans to list on the Nasdaq under the symbol “BDTX.” J.P. Morgan, Jefferies and Cowen are the joint bookrunners on the deal. No pricing terms were disclosed.
6) And Cirius Therapeutics Inc. didn’t wait for the government shutdown to end before it filed its IPO last January. It was, as JP Morgan analysts had predicted the month prior, “The Year of NASH” and Cirius believed their Phase 2 program could raise $86 million. But after a slew of subsequent industry-wide NASH failures, Cirius is withdrawing their IPO. The biotech has one product: MSDC-0602K, a molecule designed to bind to part of the mitochondria and balance the metabolism in patients with NASH with fibrosis. In Cirius’s S-1, they billed their 402-person EMINENCE trial as “to our knowledge…the largest Phase 2b clinical trial focused on the treatment of NASH.” The San Diego, CA-based company was founded in 2015 and had planned to list on the Nasdaq under the symbol “CSTX.” Citi and Credit Suisse were set to be the joint bookrunners on the deal.