Akcea cuts share price, ups volume to get $125M IPO away

The $125 million IPO gives Akcea the cash to seek approval for volanesorsen.

Akcea Therapeutics has set the terms for its $125 million IPO. The Ionis Pharmaceuticals spinout priced the IPO well below its target range but made up the shortfall by selling 62% more shares than it originally planned.

The end result is Akcea is set to gross $125 million as intended. But that top-line success masks the biotech's inability to get close to the $12 to $14 a share it targeted in its filings last month. Akcea ultimately got investors to buy in at $8 a share, and the company hit its $125 million financing goal by selling 15.6 million shares rather than the originally planned 9.6 million.

Akcea’s failure to get near its share price target at a time when other biotech IPOs are faring better suggests Wall Street is wary. With Akcea set to file for FDA approval of volanesorsen in familial chylomicronemia syndrome (FCS) in the third quarter, it offers investors a fast route to owning a biotech with a commercial product. But safety data for volanesorsen have spooked some investors.

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Ionis saw its share price slip 8% after it posted phase 3 data on volanesorsen in FCS in March, despite the study hitting its primary endpoint. The negative reaction to positive efficacy data was caused by the five patients who dropped out due to falling platelet levels. When other dropouts were tallied, 30% of patients in the treatment arm cut their participation in the trial short.

However, none of the platelet-related dropouts happened after Ionis implemented a monitoring program. Akcea thinks it can mitigate the risk by building routine platelet monitoring into a patient and physician education program.

The late-phase nature of Akcea’s pipeline means investors won’t have to wait long to find out if the mitigation is successful. Akcea has set aside $80 million of the IPO haul to bring volanesorsen to market in FCS and wrap up a phase 3 trial in familial partial lipodystrophy (FPL). Data from the FPL trial are due in 2019. Other upcoming events include the delivery of mid-phase data that will trigger $150 million opt-in decisions by Novartis.

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