IPO bonanza as biotechs get in while the iron’s hot (or before it cools)

Nasdaq
After Moderna's monster IPO attempt, other biotechs want to get their IPOs off, lest the window is about to close. (NasdaqStockExchange)

It feels like there’s a little more than just precipitation in the air at the J.P. Morgan Healthcare Conference this year: a dash of optimism and cash.

We’ve already seen two major deals in Eli Lilly snapping up biotech-of-the-moment Loxo Oncology for $8 billion, a hefty premium, and Bristol-Myers Squibb’s left field purchase of Celgene.

While smaller biotechs aren’t going to be having billions thrown at them, they’re still seeking to go public, and as JPM 2019 ramps up, three companies are making their pitch: bladder cancer biotech Anchiano Therapeutics, which has filed for a $35 million public offering; Poseida Therapeutics, which wants $115 million for its BCMA CAR-T therapy work; and a $150 million attempt from Alzheimer’s biotech Alector, a 2015 Fierce 15 winner.

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Let’s start with the biggest, and likely disease-wise most difficult, Alector. The South San Francisco, California-based company was set up in 2013 and plans to list on the Nasdaq under the symbol ALEC.

According to its SEC-1, Alector, which raised $133 million in a series E round last year (an IPO clearly long beckoning when you start getting that far into the alphabet) is seeking a pretty substantial $150 million for its work on Alzheimer’s and dementia—eschewing common research patterns that focus on amyloid beta and/or tau build-up in the brain—and instead focusing on whether the disease is caused by immune cells within the brain itself.

The approach, dubbed immuno-neurology, targets immune dysfunction as a root cause of multiple pathologies seen as drivers of degenerative brain disorders, such as AD.

RELATED: Alector raises $133M in 5th VC round to push neuro-immunology drugs into Alzheimer’s trials

In its prospectus, the OrbiMed and Polaris-backed biotech said, “We are developing therapies designed to simultaneously counteract these pathologies by restoring healthy immune function to the brain […] In the last five years, we have identified over forty immune system targets, progressed over ten programs into preclinical research, and advanced two product candidates, AL001 and AL002, into clinical development.”

In the second half of 2018, AL001, which was initially aimed at treating a genetic subset of patients with frontotemporal dementia (FTD) carrying a progranulin loss of function mutation (FTD-GRN), was dosed in forty-two healthy subjects in a single ascending dose phase 1 study.

“There were no serious adverse events or dose limiting adverse events reported in the study, achieving the primary endpoint,” the company noted, adding, “We plan to advance AL001 into a phase 1b study with proof-of-mechanism data in FTD-GRN patients expected in the first half of 2019 and into a phase 2 study with proof-of-concept data in FTD-GRN patients expected in the first half of 2020.”

Also in the second half of 2018, it kick-started a dose-escalation phase 1 in healthy volunteers with AL002, its attempt to treat Alzheimer’s, with plans also slated for clinical studies of AL003, another AD candidate (and both partnered with AbbVie), and AL101, aimed at “multiple neurodegenerative disorders,” set to start later this year.

Then there’s Poseida Therapeutics, a San Diego, California-based company founded back in 2014, which wants $115 million for a listing on the Nasdaq under the symbol PSTX.

The biotech is working on P-BCMA-101, a BCMA CAR-T therapy for multiple myeloma, and also has earlier, preclinical shots on goal.

But at the ASH 2018 blood cancer conference back in early December, Jefferies dumped on Poseida’s recent results for its-BCMA-01 as “inferior” (43% ORR) at the lower dose of 456 million cells tested. Raising the dose to 845 million cells improved the ORR to 100%, but it looks like the dose is going to have to be higher than those of its rivals.

For comparison, Celgene and Juno’s JCARH125 had an ORR of 83% in patients receiving 150 million cells or more, while at the lowest 50 million dose it still managed 79% ORR.

It’s a crowded research field, and last year’s ASH saw a plethora of presentations on BCMA-targeting drugs, but analysts at Jefferies still believe Bluebird Bio’s CAR-T therapy bb2121 “is leading the pack.”

In its most recent update for its therapy, shared in its SEC filing, Poseida said, “Preliminary results from our ongoing Phase 1 dose escalation clinical trial of P-BCMA-101 showed that as of November 21, 2018, of the 19 patients that were evaluable by International Myeloma Working Group, or IMWG, criteria, 14 had meaningful responses (either stringent complete response, complete response, very good partial response, partial response or minimal response, by IMWG criteria), with an objective response rate, or ORR, of 100% in three evaluable patients that had received the dose of P-BCMA-101 we expect to advance into phase 2 clinical development.”

Given some serious safety concerns with other therapies in this area, toxicity remains a concern for all. “In addition, as of November 21, 2018, P-BCMA-101 continued to be well tolerated in the trial, with two mild and transient instances of cytokine release syndrome, or CRS, observed, and one patient with possible neurotoxicity, each of which occurred at doses below the planned phase 2 dose,” the company said.

The company added that serious adverse events of neutropenia, thrombocytopenia, anemia and infection “were observed”, but believed these SAEs “are not related to P-BCMA-101 as they are consistent with conditioning lymphodepletion therapy and the underlying disease.” It added the caveat: “While we believe these preliminary results are encouraging, they are derived from a small number of patients and may not be predictive of future results or the durability of responses over time.”

Hence the need for a midstage test, slated for the first half of the year, moving toward a potential BLA filing with FDA “by the end of 2020.”

How come so quick? “We believe our planned phase 2 clinical trial has the potential to be a registrational trial, which is a trial that could support a BLA filing,” although the FDA “has not indicated its agreement or that a phase 3 clinical trial will not be required.”

And finally the Jerusalem, Israel-based company Anchiano Therapeutics, a late-stage biotech developing gene therapies for early-stage bladder cancer, wants $35 million in an initial public offering, with Insiders set to snap up $17.5 million of the IPO, according to Renaissance Capital.

According to its SEC filing, the biotech is working on a targeted gene therapy for early-stage bladder cancer, specifically on inodiftagene vixteplasmid, or just inodiftagene, that it believes “can deliver a new treatment to patients who have options that are limited in efficacy and problematic in toxicity.”

Inodiftagene is a recombinant DNA construct that will be administered to patients whose therapy for early stage bladder cancer has failed. Preclinical and clinical trials completed so far “have demonstrated that our product candidate can deliver a lethal gene specifically to bladder cancer cells in a patient’s bladder.,” the biotech says, and: “Based on our phase 1 and phase 2 clinical trial results, we believe our product candidate, inodiftagene, has the potential to improve patient outcomes substantially by delaying or in some cases eliminating disease progression, and consequently may significantly improve patients’ quality of life.”

After a bumper biotech IPO year in 2018 and Moderna’s monster IPO attempt, there is concern the window may start to close very soon, so don’t be surprised if a few more companies try to get in on the act in the coming weeks.

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