In a big day of setting up IPOs for launch, the charge is being led by Royalty Pharma, a buyer of biopharmaceutical royalties and an industry funder, which is aiming at a $2 billion offering. That massive number is more than half of the total biotech offerings brought in through May.
In the first five months of 2020, the industry raised more than $3.3 billion, which is more capital than biotechs have raised during the first five months of any of the previous 20 years.
New York-based Royalty is offering 60 million class A ordinary shares to be priced between $25 and $28 each to be listed on Nasdaq under the ticker symbol RPRX. The range’s midpoint would put its fully diluted market value at $15.8 billion.
Royalty partners to co-fund late-stage clinical trials and new product launches in exchange for future royalties. It also acquires existing royalties from original developers. Founded in 1996, the company said it deployed $18 billion in cash through Dec. 31, 2019, to acquire biopharmaceutical royalties, a number the company estimates to represent more than 50% of all royalty transactions completed during that time period.
Royalty has collaborated with academic institutions, including Emory University, UCLA and Northwestern University, as well as research hospitals, not-for-profit businesses, and small, mid-cap and global pharmas. Its royalties bring in payments from high-profile therapies that include Imbruvica (ibrutinib, Johnson & Johnson/Abbvie Inc.), DPP4 inhibitor Januvia (sitagliptin, Merck & Co. Inc.), Kalydeco (ivacaftor, Vertex Pharmaceuticals Inc.), Trikafta (elexacaftor/tezacaftor/ivacaftor and ivacaftor, also from Vertex), Truvada (emtricitabine/tenofovir, Gilead Sciences Inc.), Tysabri (natalizumab, Biogen Inc.) and Xtandi (enzalutamide, Astellas Pharma Inc).
In March, Royalty acquired Massachusetts General Hospital's royalty interest in Entyvio (vedolizumab, Takeda Pharmaceutical Co. Ltd.) for ulcerative colitis, Crohn's disease and inflammatory bowel disease.
In the queue
Also setting IPO terms are Avidity Biosciences Inc., which is developing oligonucleotide therapies to treat muscle disease and is offering 10 million shares at a range of $14 to $16, which would raise $150 million the midpoint price. Generation Bio Co. is offering 7.4 million shares between $16 to $18, which would raise about $126 million at the midpoint, and hearing loss biotech Akouos Inc. is planning a $100 million IPO, though the number of shares and share price have not yet been disclosed.
Avidity, of La Jolla, Calif., is developing antibody-oligonucleotide conjugates for oligonucleotide-based therapies using the tissue selectivity of monoclonal antibodies to access previously undruggable tissue and cell types. The company’s lead candidate, AOC-1001, is designed to treat myotonic dystrophy type 1, a rare monogenic muscle disease. The company expects to submit an IND for AOC-1001 in 2021 and begin a phase I/II trial before that year ends. It also has candidates in programs targeting muscle atrophy, Duchenne muscular dystrophy, facioscapulohumeral muscular dystrophy and Pompe disease. Avidity raised $100 million in November in a series C funding.
It is seeking a listing on Nasdaq under the ticker RNA.
Generation Bio, of Cambridge, Mass., has a nonviral gene therapy platform that uses closed-ended DNA. It also has a cell targeted lipid nanoparticle delivery system as well as a capsid-free manufacturing process. The company is developing eight programs for rare and prevalent diseases of the liver and the retina, which result from single-gene mutations with well-established biomarkers. So far, it has not entered the clinic. It is seeking a listing on Nasdaq under the ticker GBIO.
Boston-based Akouos, which launched in 2016 and develops gene therapies for inner ear disorders, is developing lead candidate AK-OTOF, a gene therapy focused on restoring hearing in individuals with sensorineural hearing loss due to mutations in the otoferlin gene. Without functional otoferlin protein, auditory signals received by the ear cannot be transmitted to the brain. AK-OTOF uses an adeno-associated viral vector (AAV) to deliver a healthy copy of the OTOF gene to cochlear hair cells, with the goal of restoring long-term physiologic hearing following a single administration to the inner ear. It is building on the work of Luk Vandenberghe, of Harvard Medical School, who has probed AAV biology by undertaking an in silico reconstruction of AAV evolution through phylogenetic analysis
Akouos, which raised $105 million in an oversubscribed series B in March, seeks a listing on Nasdaq under the ticker AKUS.
At the other end of the spectrum, Pliant Therapeutics closed its IPO of 10.3 million shares June 5 at $16 each. The company’s stock (NASDAQ:PLRX) rose 4.27% on Monday with shares closing at $23.20.