Mirna Therapeutics is about to find out whether turbulence in the financial markets has blown the IPO window shut. The company brushed off concerns that the three-year IPO party is winding down by filing to raise up to $80.5 million to advance its tumor suppressor into Phase II.
Austin, TX-based Mirna unveiled its IPO plans hours after the end of one of the most dramatic days for stock markets in recent times, on which the Nasdaq Biotechnology Index plunged 23% from its July peak before rallying to close down 4% for the day. The turbulence in recent days has already prompted genetic test maker RainDance Technologies to scuttle its IPO plans but Mirna is trying to push ahead through the uncertainty. In its favor, the microRNA replacement specialist can boast of an enviable list of investors, including Baxalta ($BXLT), Celgene ($CELG) and Pfizer ($PFE).
Baxalta and Pfizer own 20% of Mirna today, while New Enterprise Associates and Sofinnova Ventures account for a further 35% of the shares. The level of support for the IPO from such insiders could enable Mirna to hit its fundraising target even if investor enthusiasm for biotechs cools, giving it the cash it needs to advance its development plans. Mirna, which raked in $41.8 million in a Series D round in April, will pump most of the anticipated IPO haul into wrapping up Phase I and II trials of MRX34, plus preclinical work looking at new indications and combinations for the drug.
MRX34, the only of Mirna's assets to enter the clinic, is a double-stranded RNA mimic of miR-34, a tumor suppressor. Mirna has encapsulated the RNA in a nanoparticle, resulting in a formulation it thinks can trigger immune responses that kill cancer cells. Solid tumors and hematological malignancies are both in Mirna's sights. The strength of the candidate has helped Mirna to gather significant sums of money--the Series D investment followed an earlier $34.5 million round--from A-list backers, but there are doubts about whether these credentials will be enough to IPO now.
"With last week's mayhem and today's drop you can expect IPO activity to grind to a complete halt," Jay Ritter, an IPO expert and professor at the University of Florida, told Reuters. "The IPO market is always hyper sensitive to market movements and you can expect it to dry up when it falls."