Oric Pharmaceuticals Inc. stepped into a tough economic climate on Friday when it priced its IPO of 7.5 million shares of common stock at $16 each and won the day as shares (NASDAQ:ORIC) closed at $25.77 each, 61.06% higher than they started.
Despite uncertainty presented by the COVID-19 pandemic, so far in 2020, $2.465 billion has been raised through biopharma IPO financings as tracked by BioWorld. In years steeped in a far less risky financial climate than this year, biopharma IPO financings soared, especially in the previous two years. In 2018, $10.696 billion was spent on biopharma IPO financings and 2019’s amount, at $8.644 billion, was not that far behind. Both years were by far the highest grossers in the past 10 years.
Even though 2020 is only about one-third of the way finished, the $2.465 billion spent on 14 biopharma IPO financings so far this year is only 10.7% less than the $2.729 billion spent on biopharma IPOs in 2010, 2011 and 2012 combined.
Although public offerings slowed considerably in March as a result of the steepest stock market declines in history during that period, global biopharmaceutical companies managed to collectively generate just over $16 billion in the first quarter from a record number public and private transactions. Only the first quarter of 2018 saw more cash raised in the past decade, according to BioWorld data. Public offerings, including IPOs, represented approximately 52% of 2020’s first-quarter financings.
As for Oric’s IPO, the range for the price per share had been set at $14 to $16. Gross proceeds are expected to be $120 million. The offering is set to close April 28. The company launched in 2014 and has devoted substantially all its resources to R&D, including with respect to its GR antagonist and CD73 inhibitor programs and other preclinical programs, business planning, establishing and maintaining intellectual property portfolio, hiring personnel, raising capital and providing general and administrative support, according the company’s SEC filing.
Oric’s net loss was $26.9 million for 2019, with an accumulated deficit of $92.7 million, the company’s SEC S-1/A form stated. The company’s lead product candidate, ORIC-101, is in early stage clinical trials, and the company expects to file an IND for its second product candidate, ORIC-533, in the first half of 2021, the SEC filing stated. ORIC-101, a small molecule, is a selective glucocorticoid receptor antagonist targeting treatment resistance to multiple classes of cancer therapeutics in a variety of solid tumors.
The pipeline at Oric, an acronym for "overcoming resistance in cancer," also includes an orally available small-molecule inhibitor of CD73, as well as other undisclosed programs targeting mechanisms of oncology therapeutic resistance. Oric raised $55 million in a series D financing last August to help drive two separate phase Ib trials of ORIC-101 in combination with Xtandi (enzalutamide, Astellas Pharma Inc./Pfizer Inc.) in metastatic prostate cancer and Abraxane (nab-paclitaxel, Celgene Corp./Bristol Myers Squibb Co.) in advanced or metastatic solid tumors.
J.P. Morgan, Citigroup, Jefferies and Guggenheim Securities are acting as joint book-running managers for Oric.
This is the third IPO launch in April. Keros Therapeutics Inc., of Lexington, Mass., closed its IPO of 6.9 million shares of common stock (NASDAQ:KROS) at a public offering price of $16 per share, for total gross proceeds of $110.4 million. Keros’ IPO launched April 8 at $16 per share and closed Friday at $30.59, a 3.8% increase just on the day. On April 3, Zentalis Pharmaceuticals LLC launched its IPO at $18 per share. On Friday, the company stock (NASDAQ:ZNTL) was up 7.21% to close at $30.50.
In January, six biopharmas launched IPOs, but the numbers have dwindled since then, with four launching in February and only two in March. Thirteen biopharma IPO launches are pending, according to BioWorld data.