Ascendis Pharma ($ASND) cleared $108 million and Zosano Pharma ($ZSAN) raised $50 million in the first biotech IPOs of 2015, stoking hopes that the industry's window onto Wall Street will stay open well into the new year. And that pales in comparison to Spark Therapeutics' plans as it upsized its offering on the back of high hopes for the upstart gene therapy player out of Philadelphia.
Copenhagen-headquartered Ascendis moved 6 million shares at $18 each, pricing at the top of its expected range. The biotech has set aside another 900,000 shares for its underwriters, setting its maximum deal value at $124.2 million. With the proceeds, Ascendis plans to get its once-a-week treatment for growth hormone deficiency (GHD) into late-stage testing. Each of the company's drug candidates is based on technology called TransCon, a hydrogel made of prodrug linkers that seek out targeted molecules in the body and then release their therapeutic payload. Beyond its GHD treatment, Ascendis has TransCon-powered therapies for hypertension, diabetes and ophthalmic disease in its early-stage pipeline.
Zosano, based out of Fremont, CA, priced in the middle of its range at $11 a share after upsizing its offering by more than 40%. In tandem with the IPO, partner Eli Lilly ($LLY) has agreed to buy a $15 million stake in the company. Zosano plans to use the majority of its proceeds on a microneedle patch formulation of the hormone glucagon, slated to enter Phase II as a treatment for hypoglycemia this year. The biotech is also developing a patch-delivered version of zolmitriptan for migraines, planning to begin Phase I in the coming months. Zosano's lead candidate, licensed to Lilly in a $440 million deal last year, is a Phase III treatment for osteoporosis.
Meanwhile, gene therapy outfit Spark Therapeutics has boosted the size of its planned public debut, adding another 1 million shares to its offering and increasing its expected price range by 25% to between $19 to $21. The biotech is now slated to raise $130 million at its midpoint, cash that will fund the late-stage development of its FDA-designated "breakthrough" therapy for rare eye diseases.
In macro terms, all three companies will likely be viewed as bellwethers for how well the industry's 2014 momentum will translate into 2015. Biotech debutantes raised a record $6.3 billion in IPO cash last year, a figure buoyed by increasing high valuations and investor fervor over technologies like cancer immunotherapies and gene therapy. And while most at this month's annual JP Morgan Healthcare Conference were optimistic the good times would keep rolling into the new year, for how long and to what extent remain topics of debate.
Despite the uncertainty, the pace of filings has hardly slowed down. Among biotechs in the queue are Tracon Pharmaceuticals, seeking $47 million; Flex Pharma, swinging for $60 million; and Carbylan Therapeutics, out for $75 million.
- read Ascendis' statement (PDF)
- here's Zosano's release
- check out Spark's filing