Banking on its R&D rep, Calithera looks to raise $80M in IPO

About 5 years ago, Susan Molineaux and the executive team at Proteolix decided the time was ripe to grab a buyout deal from Onyx ($ONXX), which would push ahead on its lead drug program to win an approval for Kyprolis, which in turn inspired the big Amgen ($AMGN) acquisition. Now, about four years after launching their next venture, Molineaux and the team at Calithera think this is the right time to go public.

The biotech filed an S-1 at the SEC outlining plans for an $80 million IPO designed to launch a slate of mid-stage studies for its lead drug, an in-house therapy dubbed CB-839 which should inhibit glutaminase, an enzyme that plays a key role in tumor metabolism. Tumor metabolism is all about stopping the growth and preventing the survival of tumors. And a drug for tumor immunology is waiting in the preclinical wings which inhibits the enzyme arginase.

The lead drug is currently in 5 early-stage studies for a lineup of cancers that ranges from breast cancer to lymphoma and leukemia.

Like a lot of biotechs, Calithera paints its annual numbers in red, with the $9.9 million R&D budget line for 2013 accounting for the lion's share of the total loss. According to the S-1, the company has raised close to $80 million from investors, adding $16 million through the sale of Series D shares in July. The biotech's last announced round was back in the fall of 2013, when Molineaux unveiled a $35 million round that would take the company into the clinic--after it was forced to regroup when the leadership decided to switch R&D focus not long after the biotech launched.

The Longwood Fund and two unnamed institutional groups signed on as new investors last year, with Longwood's Christoph Westphal--another high-profile biotech figure--taking an observer's chair on the biotech's board. Existing investors Morgenthaler Ventures, Advanced Technology Ventures and Delphi all contributed as well.

Proteolix took a buyout deal at a time that going public was all but impossible for a biotech company. Now the team at Calithera will see if it can make it into the market based largely on their rep in the industry and the success of Kyprolis--a strategy that has worked well for a number of biotechs. Last year and early this year, early-stage companies have done well. But the number of misfires is growing now, as investors pick and choose between what's hot and what's not. 

- here's the S-1