After assembling a whopping $175 million financing deal this spring, Ophthotech has filed paperwork with the SEC to secure up to $85 million more in an initial public offering. So add the New York City-based biotech outfit to the growing list of drug developers in the hunt for IPOs.
Ophthotech has hit the IPO trail after announcing plans to advance its lead therapy Fovista into Phase III clinical development for wet age-related macular degeneration by the end of 2013. Upbeat results from a Phase IIb study showed that a treatment with a combination of the compound, an inhibitor of platelet-derived growth factor (PDGF), and Roche's ($RHHBY) anti-VEGF therapy Lucentis, outperformed Lucentis alone for treating the leading cause of blindness in people aged 55 and older.
In financing announced in May, Novo A/S struck a $125 million royalty deal with Ophthotech and led the company's $50 million Series C round. Novo has gained royalty rights on sales of Fovista in the first deal, which paid out an initial $42 million at the closing with the rest pinned to development milestones. The money behind the royalty deal and the third-round financing comes to Ophthotech in three phases, so the company actually ended June with $39.9 million in cash and equivalents as it prepared for the major late-stage study.
With Fovista, Ophthotech Chairman and CEO Dr. David Guyer and President Dr. Samir Patel aim to elbow in to the more than $4 billion annual market for drugs against wet AMD, now dominated by Roche with rising star Regeneron Pharmaceuticals ($REGN) fast on its heels with growing sales of Eylea. Guyer and Patel had developed Fovista at their previous company Eyetech, which was sold to OSI Pharmaceuticals in 2005. They later acquired the drug back from OSI.
The IPO market has been hot so far this year for drug developers, with nearly 30 biotech startups going public after only 11 such companies did so in 2012. The success of Ophthotech is highly dependent on the ability of the company to replicate its upbeat midstage trial for Fovista in Phase III. The company expects to have top-line data from the late-stage study in 2016, and if successful, plans call for filing for market approvals of the drug with regulators in the same year.
The company's top institutional backers include Novo (28.65%), SV Life Sciences (26.8%), HBM Healthcare Investments (15.21%) and Clarus Ventures (13.57%). Ophthotech aims to list its shares on the Nasdaq under the symbol "OPHT."
- here's the S-1 filing
Special Report: Is the biotech IPO frenzy headed for a crack-up?