Forward Pharma pulls off a $221M IPO with eyes on unseating Biogen

Danish drug developer Forward Pharma ($FWP) came through with one of the year's biggest biotech IPOs, raising $221 million to support its plot to battle Biogen Idec ($BIIB) in the blockbuster multiple sclerosis market.

The company moved 10.5 million shares at $21 each--the middle of its proposed range--and set aside another 1.6 million shares to cover any overallotments, setting it up for a maximum deal value of about $253.6 million.

Forward's lead treatment is FP187, a Phase III MS drug that uses a proprietary formulation of dimethyl fumarate (DMF), the same active ingredient in Biogen's Tecfidera. The company plans to begin a late-stage trial testing FP187 against relapsing-remitting MS this year, looking to enroll about 2,000 patients and compare the drug with active beta interferon with a primary efficacy endpoint of annualized relapse rate. After that, Forward expects to launch a Phase III psoriasis study on FP187 in 2015.

But beyond its clinical aspirations, the biotech has plans to contend with Biogen in the courtroom, setting aside another chunk of its IPO cash to fund an intellectual property fight.

Forward was founded in 2005 to develop some assets acquired from Sweden's Aditech Pharma, among them some slow-release formulations of DMF to treat MS. Looking at Tecfidera, Forward believes its patents predate Biogen's. Now, the company is waiting on the U.S. Patent and Trademark Office to set a date for a hearing in which a three-judge panel will weigh in on who discovered DMF first. If Forward wins out, Biogen could be hamstrung in its ability to market Tecfidera, a drug that brought in more than $700 million last quarter and has skyrocketed since winning FDA approval last year.

Biogen, in a statement, said the company doesn't "believe Forward Pharma's patent filings will affect our ability to market Tecfidera," adding that it has "a strong IP portfolio" that "grew out of our pioneering efforts in bringing this important medicine to patients."

Forward's successful debut comes amid a boom-and-bust climate for biotech IPOs. More than 70 drug developers have gone public in 2014, but the frothy valuations of the early year have long since subsided, leaving many market entrants to either accept painful discounts to their planned prices or put off their offerings altogether. In terms of size, Forward's $221 million raise comes second only to Circassia, a U.K. allergy biotech that raised more than $333 million in a March IPO.

- read the announcement

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