Trio of IPO setbacks strike sour note at biotech's Wall Street party

In a fresh sign that the big biotech IPO wave that triggered a long lineup of dazzling debuts may have crested, two new California contenders have had to significantly scale down their expectations and a third has decided to bow out for now.

Relypsa ($RLYP) slashed its asking price on 6.9 million shares to $12 a share from an ambitious range of $16 to $19 a share. It now plans to raise $82 million. But Xencor ($XNCR) had to cut back even more, dropping its IPO price to $7 a share from a range of $14 to $16. Xencor also had to more than double the shares on offer to raise $75 million.

Meanwhile, Celladon, also based in California, decided to exit the crowded biotech IPO stage rather than proceed under what it termed poor market conditions.

The trio of IPO setbacks will spur fresh speculation that the IPO boom--which came after a long drought triggered by the big 2008 financial bust--has turned into a glut. The latest count shows 44 biotechs going public this year, with 17 now left in queue and more likely readying their pitches. Between early 2008 and fall of 2009 there were no IPOs in the industry, and only 11 in all of last year. The total raise among drug developers and a batch of diagnostics companies--excluding medical devices--is nearing $3.5 billion.

Xencor--a 2005 Fierce 15 veteran--plans to spend its proceeds on candidates for autoimmune and allergic diseases. The biotech made its name with XmAb, a biologics platform that can extend the half-life of antibodies and boost their targeting power, capabilities that lured partners like Pfizer ($PFE), Amgen ($AMGN) and Boehringer Ingelheim. Relypsa is completing development of patiromer, a drug designed to treat life-threateningly high levels of potassium in the blood, commonly found in patients with chronic kidney disease or heart failure. 

Celladon, a 2012 Fierce 15 company, had set out to grab $86.3 million in its planned public debut, looking for more cash to put toward its gene therapy for heart failure. The drug, dubbed Mydicar, inserts the SERCA2a enzyme into patients' heart cells, boosting cardiac muscle contractions to treat systolic heart failure. 

- here's the item on Xencor
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- read the item on Celladon

Special Report: 2012 Fierce 15 - Celladon  

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