Government shutdown doesn’t stop Gossamer floating

Gossamer Bio is using rare Securities Act clause to allow it to file without SEC approval. (MartisFuksu/Pixabay)

Gossamer Bio isn’t letting the government shutdown put a brake on its financing plans as it files for a $230 million IPO to help fund its clinical programs.

The biotech—one of our Fierce 15 winners in 2018—is making use of a process that allows it to push the button on its flotation without needing a green light from the Securities and Exchange Commission (SEC), which is pretty much closed down as the partial shutdown heads toward its fifth week.

Gossamer is making use of Section 8(a) of the Securities Act, which means it can file its registration unilaterally providing it agrees to fix its IPO price for 20 days—in this case until Feb. 12. The company is offering 14,375,000 shares of its common stock at an IPO price of $16.00 per share, and if the listing goes through on that basis the company would be worth about $1 billion.

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“In the event that the federal government and the SEC resume normal operations prior to February 12 … Gossamer Bio will re-evaluate the use of Section 8(a) in connection with the offering,” said the biotech in a statement.

Citing Renaissance Capital data, Reuters suggests about 80 companies across multiple business sectors have filed with the SEC for IPOs, but none have completed a listing on the U.S. stock exchange since the shutdown started on Dec. 22.

If it goes through as planned, San Diego-based Gossamer will get the cash injection it needs to push ahead with an ambitious development portfolio that includes three drugs in clinical trials across multiple immunology indications, including asthma, nasal polyposis, severe urticaria (hives), pulmonary arterial hypertension (PAH) and inflammatory bowel disease (IBD), and another three in preclinical development

The company already pretty flush with cash, having raised $100 million on its debut and followed that with a $230 million series B that made it one of the most well-funded Fierce 15 winners of all time.

Heading Gossamer’s pipeline is GB001, an oral antagonist of prostaglandin D2 receptor 2 already in a phase 2b trial in moderate-to-severe eosinophilic asthma and with midstage studies also planned in chronic rhinosinusitis caused by nasal polyps and chronic spontaneous urticaria for later this year, according to the firm’s SEC prospectus.

Following GB001 are GB002, an orally inhaled platelet-derived growth factor receptor kinase inhibitor for PAH, and hypoxia inducible factor-1a stabilizer GB004 for IBD, both of which are in phase 1 testing.

Gossamer is planning to push GB002 into a phase 2/3 trial in PAH before the end of the year and to start phase a 1b trials of GB004 in ulcerative colitis in the first half of 2019, with a phase 2 trial in Crohn’s disease following in 2020.

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