After raising $108 million in venture cash, LA-based Kythera Biopharmaceuticals has filed for an IPO designed to contribute about $86 million. The IPO's success will hinge on the company's ability to generate some investor excitement over ATX-101, a late-stage fat-busting therapy intended to cure people of the double chin.
Kythera can make a good case that it's closing in on a product revenue stream. Bayer, which has ex-U.S. rights to the drug, has already completed a pair of positive late-stage studies on ATX-101. Kythera's Phase III trial, with 1,000 patients, got under way two months ago and should deliver data next year. And the biotech used its S-1 registration to tout its prospects in the $10 billion U.S. market for aesthetic treatments.
Kythera is banking on a simple but powerful human weakness: Vanity.
"Demand for facial injectable procedures is driven by the considerable importance of the face to overall appearance," the company says in the S-1. "We believe the growing variety and accessibility of non-surgical aesthetic procedures combined with increased social acceptance of aesthetic medicine in general have contributed to the adoption of these procedures by a broader patient demographic … [u]ndesirable submental fat, or double chin, remains an important yet unaddressed aesthetic target for injectable facial treatment."
That market prospect has attracted an A-list group of venture backers. Versant Ventures, Arch Venture Partners, Prospect Venture Partners, JAFCO, Partner Funds management, INVUS Financial Advisors, BBT Capital Management/Apothecary Capital, Altitude Life Science Ventures, Foley Ventures and Latham and Watkins have all backed the company.