Versartis grabs $126M in an upsized IPO to fund its orphan drug

A month removed from raising $55 million in Series E cash, Versartis ($VSAR) has hauled in $126 million more in an IPO, filling its coffers and planning to take its growth hormone deficiency treatment all the way to market.

The Redwood City, CA, biotech sold 6 million shares at $21 each, upping its offering by 30% and pricing at the top of its projected range. With its combined $181 million, Versartis plans to pay its way through a Phase III study for VRS-317, a long-acting recombinant human growth hormone designed to treat HGH deficiency. Right now, the standard of care is a series of inconvenient daily injections, the company said, and Versartis figures it win approval for VRS-317 and grab a major share of the roughly $3 billion market for HGH deficiency treatments, all without the need for a deep-pocketed partner.

The company is starting off with pediatric patients, working through a Phase IIa study to test VRS-317's effect on height velocity at 6 months and expecting a data readout by June. From there, Versartis plans to embark on a Phase III study and eventually submit the treatment for FDA approval.

With a successful IPO under its belt, the biotech has thus far been a hit with investors both public and private, raising more than $132 million in venture cash since its incorporation in 2008. The company's backers include Sofinnova Ventures, Index Ventures, Aisling Capital, New Leaf Venture Partners, Advent Venture Partners and 5 undisclosed "leading life science investment firms."

Meanwhile, the prolonged biotech IPO boom is stretching the limits of hyperbole. Including Versartis and the $19 million debut of minor player Ruthigen ($RTGN), 28 life sciences have pulled of Wall Street debuts in the first quarter of the year alone, creeping toward the 37-company watermark set in 2013's record-breaking bull market.

And while more than a few iffy outfits have squeaked out pared-down offerings to keep the doors open, the class of 2014 is flush with well-performing entrants. Akebia, which priced at $17 a share on Thursday, leapt 57% in its first day of trading, while Dicerna ($DRNA) and Ultragenyx ($RARE) have more than doubled in value since going public. And, with a week left to go in Q1, another crop of hopefuls is in line for IPOs, Signal Genetics, Agile Therapeutics, Aldeyra Therapeutics and GlobeImmune.

- read the announcement