Sanofi partner Zealand files for IPO to fund drug approvals 

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Zealand wants the IPO cash to fund trials of glepaglutide and dasiglucagon.

Zealand Pharma has become the latest European biotech to file for a Nasdaq IPO. The Sanofi-partnered peptide specialist is seeking about $86 million (€75 million) to take its treatments for insulin shock and short bowel syndrome (SBS) through clinical trials and up to registration.

Copenhagen-based Zealand’s filing follows quickly after positive news for the company and the broader IPO market. Last month, a phase 2 trial of one of the two drugs Zealand is hoping to bring to market—SBS candidate glepaglutide—met its primary endpoint. That success enabled glepaglutide to join insulin shock drug dasiglucagon in Zealand’s late-phase pipeline.

Glepaglutide and dasiglucagon are the centerpieces of Zealand’s plan for the IPO cash. By pooling the IPO haul with the $59 million it already has and anticipated revenues from drugs licensed to Sanofi and Boehringer Ingelheim, Zealand thinks it will have enough money to wrap up clinical development of both assets and take the data to regulators.

Dasiglucagon is the more advanced of the two candidates. The glucagon peptide analog held its own against Novo Nordisk’s GlucaGen in a phase 2 trial last year. That trial assessed the drugs in type 1 diabetics who had suffered an insulin-induced hypoglycemic event. Buoyed by the data, Zealand started one phase 3 trial and plans to go live on another by the end of the year. Dasiglucagon, also known as ZP4207, is also the drug in Zealand’s experimental artificial pancreas. 

Zealand cleared the path for glepaglutide to enter phase 3 more recently. Phase 2 data reported weeks ago linked the long-acting GLP-2 analog to declines in fecal wet weight in SBS patients, prompting Zealand to gear up to enter phase 3 next year. 

If the late-phase program is successful, glepaglutide will compete with Shire’s Gattex for the SBS market. Shire acquired Gattex in its $5.2 billion takeover of NPS Pharma and grew sales by 55% last year to $219 million. But Zealand thinks the multistep reconstitution process required to deliver Gattex is a weakness glepaglutide can exploit if it comes to market. 

The success of these programs has contributed to a 25% rise in Zealand’s stock in Denmark this year and caused memories of the failure of a cardiac program and loss of an Eli Lilly partnership to fade.

Zealand is now hoping that momentum will propel it to a Nasdaq IPO. If that happens, Zealand will join a growing list of European biotechs that missed out on the go-go IPO years but have made the leap successfully now that the window has reopened. Over the past 12 months, European biotechs including AC Immune, Argenx, Motif Bio, ObsEva and Verona Pharma have listed on Nasdaq.