Kite Pharma rides the CAR-T current to a $128M IPO

Biotech upstart Kite Pharma ($KITE) made its Wall Street debut Friday, pulling off an upsized IPO on the strength of investor fervor over a novel, headline-making approach to treating cancer.

Kite flipped 7.5 million shares at $17 each, outgrossing its initial target of $115 million and pricing well above its earlier projected range of $12 to $14.

The bullish optimism around Kite stems from its lead program, which uses chimeric antigen receptors to reprogram a patient's T cells and transform them into cancer-fighting agents, called CAR-T immunotherapies. The company's lead program, KTE-C19, targets CD19-positive B cell cancers, including diffuse large-B cell lymphoma (DLBCL), an aggressive subtype of non-Hodgkin lymphoma.

Kite Pharma CEO Arie Belldegrun

With its IPO haul, Kite plans to kick off a Phase I/II study on the drug in 2015 and use the results to apply for an accelerated FDA approval that would clear 'C19 for use as a third-line treatment for patients with DLBCL. From there, the biotech plans to work backward, gradually proving the treatment's worth as a second- and first-line therapy and eventually branching out into other lymphomas and leukemias.

Kite, of course, is hardly the first to dive into the potential of CAR-T technology. Novartis ($NVS) and the venture-backed Juno Therapeutics are already up and running with CAR-T clinical trials, while Celgene ($CELG) and collaborator bluebird bio ($BLUE) have been at work on their own program since last year. Just this week, Pfizer ($PFE) made a splash by recruiting French biotech Cellectis to help it catch up in the field with a multiproject deal that could be worth billions.

Pfizer's high-profile cosign of CAR-T's potential may have helped buoy Kite's twice-upsized offering, but the biotech is also hitting the market in the midst of a new wave of IPO optimism for the sector. After the stumbling second-quarter debuts of Alder Biopharmaceuticals ($ALDR), Cerulean ($CERU) and Agile Therapeutics ($AGRX), successful pricings by ZS Pharma ($ZSPH), Zafgen ($ZAFG) and Ardelyx ($ARDX) have harkened back to the industry's booming winter.

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