Biotech IPO bonanza, again, as 5 go for collective $600M-plus in offerings

Nasdaq
All five biotechs are planning to list on the Nasdaq with a combined potential total of $611 million. (Nasdaq)

Just before Memorial Day weekend, five biotech companies dropped their initial public offering plans, adding up to $611 million in anticipated cash.

First, there's late-stage genetic disease-focused BridgeBio Pharma, which wants a whopping $225 million. Building on its policy of not waiting around, another Vant, skin disease biotech Dermavant to be exact, wants $100 million. So does preclinical cancer company Atreca alongside Prevail Therapeutics, an early-stage biotech developing gene therapies for neurodegenerative diseases.

Gunning for $86 million, which used to be high but not so much anymore, is early-stage nonalcoholic steatohepatitis (NASH) biotech Akero Therapeutics.

All filed officially with the SEC Friday and all plan to list on the Nasdaq.

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A little bit about each biotech: BridgeBio already has some money in the bank, raising $135 million in late 2017 and a year ago bagging from Alexion Pharmaceuticals a synthetic enzyme replacement therapy for an ultrarare, fatal genetic disease that causes seizures in infants, which is in the latter stages of testing.

Internally, it’s a lot earlier-stage and has the goal of creating genetically targeted therapeutics that “address the fundamental causes of disease,” according to a recent prospectus.

It’s a bit different from your average startup, and works within a “hub and spoke” corporate structure that has seen it launch 10 drug programs under its dermatology, oncology, cardiology, neurology and endocrine business units.

Targets for these include transthyretin amyloidosis, pantothenate kinase-associated neurodegeneration, Gorlin syndrome and frequent basal cell carcinomas, dystrophic epidermolysis bullosa, Darier and Hailey-Hailey diseases, Netherton syndrome and SHP-2, K-RAS and C-RAF driven cancers.

Then there’s Dermavant, part of the Roivant/Vivek Ramaswamy constellation of hit-or-miss biotechs, with its lead product candidate tapinarof, a topical cream for the treatment of psoriasis and atopic dermatitis. Last summer it inked a $330 million research deal with GlaxoSmithKline for that phase 3 drug, building on the Roivant method of picking up older, often unwanted pipeline meds from Big Pharma and hoping it can do something different with it.

Late last year it also filled its leadership vacuum after short-term chair and former Celgene veteran Jackie Fouse unexpectedly left to lead Agios by replacing her with Todd Zavodnick, who was an executive at little-known Revance Therapeutics, which is working on a Botox rival.

Roivant biotechs have a history of going for an IPO early on and getting the maximum return, but this hasn’t always worked out: Ask Axovant, which raised a massive $315 million on several out-licensed Alzheimer’s and central nervous system drugs that, predictably, failed to make the grade, leading it to completely reset and become a gene therapy biotech last year.

Atreca, meanwhile, is not yet in the clinic, but plans to be starting next year when it will test its platform philosophy around cancer immunotherapy. Specifically, it says in its prospectus: “We believe we may be able to address certain key limitations of the current oncology drug discovery paradigm by focusing on the common phenomenon driving clinical responses in cancer immunotherapy—an active human anti-tumor immune response.

“Our platform allows us to interrogate an active B cell response within an individual cancer patient to identify novel and relevant antibody-target pairs, which may enable us to develop antibody-based product candidates to treat large populations of patients with solid tumors. We believe that the significant time and capital invested in developing, refining and applying our differentiated discovery platform have provided us with significant first-mover advantages and created barriers to entry.”

An IND with the FDA for a phase 1 to test this theory should be filed “by the end of 2019” for leading candidate ATRC-101, a monoclonal antibody. ATRC-101 reacts in vitro with a majority of human ovarian, non-small cell lung, colorectal and breast cancer samples from multiple patients, the biotech reports in its SEC-1.

Then there’s OrbiMed-backed Prevail Therapeutics, which just last March launched a $75 million first-round financing that will help fund development of its gene therapy for Parkinson’s disease and other programs.

Prevail was set up in 2017 by OrbiMed's co-head of private equity Jonathan Silverstein with seed funding from the investment firm as well as a nonprofit research foundation formed by Silverstein to tackle Parkinson's caused by mutations in the glucocerebrosidase (GBA1) gene after he was diagnosed with the illness in 2016.

Prevail has licensed an adeno-associated virus (AAV) gene therapy vector technology developed by Regenxbio called NAV AAV9. This will be used across its gene therapy candidates including lead program PR001, which is being developed for GBA1-linked Parkinson's, a variant thought to affect about 10% of all patients with the disease. That therapy is also being directed against neuronopathic Gaucher disease.

“We are focused on developing a broad pipeline of gene therapies for a range of neurodegenerative diseases, including PR006 for the treatment of frontotemporal dementia with GRN mutation and PR004 for the treatment of synucleinopathies,” it said in its prospectus.

And last but not least is Akero Therapeutics, which raised $65 million in a series A financing just last summer and put the cash toward advancing its lead program, a long-acting fibroblast growth factor 21 analog for the treatment of NASH.

The Cambridge, Massachusetts-based biotech licensed the candidate, known as AKR-001, from Amgen on the strength of early clinical data. It has been studied through phase 1 in diabetic patients, and Akero plans to bring it through phase 2 in patients with NASH.

Late last year it also swiftly followed that $65 million with a $70 million series B, and it now wants $86 million from an IPO as it looks to build out its metabolic disease pipeline and boost its manufacturing capabilities, work on pushing on with AKR-001 in NASH as well as potentially in-licensing other meds to boost its credentials as a metabolic-focused biotech.

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