Oryzon lists in Madrid without raising fresh funds

Roche ($RHHBY)-partnered epigenetics specialist Oryzon Genomics (BME:ORY) has listed its shares on the Madrid Stock Exchange. The biotech went public by listing all its shares on the exchange rather than offering stock to investors, leaving it with the same market cap and bank balance as when it raised €16.5 million ($18.1 million) in a rights issue earlier this year.

Oryzon CEO Carlos Buesa

Joining the stock exchange in this way gives Oryzon a platform from which to raise money in the future, while also pushing it to adapt its governance to meet the requirements imposed on public companies, an evolution that will prove valuable if the biotech achieves its mid-term goal of trading on Nasdaq. For now, Oryzon is just trading in Spain, where it listed at the €3.39-a-share price set in the recent rights issue that saw Capital MAB and a founder of Invitrogen ($IVGN)  buy into the business. The share price left Oryzon with a market cap of just shy of €100 million.

Having pulled off the listing, the focus at Oryzon now shifts to advancing its pipeline to the point at which it is strong enough to swing for an IPO on Nasdaq, assuming that remains a viable financing option for biotechs in the coming years. A Phase IIa trial of Roche-partnered acute myeloid leukemia drug ORY-1001 is in the works. And Oryzon is gearing up to start clinical trials of its wholly owned neurodegenerative drug, OTY-2001, which management thinks can stop the cognitive decline and memory loss experienced by people with Alzheimer's disease.

Given the dearth of treatment options for people with Alzheimer's and the potential size of the market, factors that have driven the likes of Biogen ($BIIB), Eli Lilly ($LLY) and Roche to place large, speculative bets on development programs, Oryzon could find itself with suitors if it can deliver solid early-stage data. As it stands, the Roche deal is effectively Oryzon's sole source of revenue. When Roche struck the deal, it handed over $21 million and committed to milestones of upward of $500 million, a tiny fraction of which has trickled into Oryzon's bank account over the past 18 months. 

On its first day of trading in Spain, Oryzon closed up 36%. Most of the biotech's shares are currently subject to a lockup period. Founders Carlos Buesa and Tamara Maes, who control 26.3% of the company, are unable to sell their stakes for 12 months. The Najeti fund, which owns 24.6% of the company, is subject to a 6-month lockup period.

- read the release (PDF)