Med-tech IPOs continue to make it out onto a strong stock market, even as global economic uncertainty prevails amidst the unfolding pandemic. Single-cell biology research company Berkeley Lights Inc. priced an upsized IPO to raise $178.2 million to back its tools that are used to help develop antibody therapeutics, cell therapies and, more broadly, synthetic biology products.

The Emeryville, Calif.-based company’s share price skyrocketed by almost 200% to reach more than $65 from the original offer price of $22. That itself also was above the upwardly revised range of $18 to $20. The first day increase already gives it a $3.7 billion valuation. Berkeley Lights may be following in the footsteps of another single-cell research tool company, Pleasanton, Calif.-based 10x Genomics Inc., which has reached a $9 billion valuation since its September IPO.

For its part, Renalytix AI plc also got a U.S. public listing done and raised $74.3 million to back its AI-based kidney disease diagnostic tests. The New York-based company already had a listing on the London Stock Exchange’s AIM market for its ordinary shares under the ticker RENX. With this financing, it added a Nasdaq listing for American Depositary Shares that are equivalent to two ordinary shares with the ticker RNLX. It closed the first day of trading unchanged from the $13.50 offer price per share.

Digital cell platform

“Berkeley Lights is a leading digital cell biology company focused on accelerating the commercialization of biotherapeutics and other cell-based products,” said the company’s CEO Eric Hobbs explained on the IPO roadshow. “The Berkeley Lights Platform, which enables what we call Digital Cell Biology, is a key component that drives this industry trend. It's our objective to set the industry standard across the cell-based product value chain.

“There are some significant challenges to making cell-based products. Namely, you have to understand and assess how the cells are going to perform or behave,” he later added. “So, in particular, you have to functionally characterize many single cells. But that's what we do. That's our business. And although we're still in the early innings of our company, we've amassed a customer list that includes industry leaders, such as eight of the top 10 largest biopharmaceutical companies in the world.”

Single-cell analytics enables detailed phenotypic, functional and genotypic information to be gathered to better understand the role of each individual cell but at scale, so that thousands of cells can be interrogated in parallel and in relation to one another. This approach is expected to advance not only our understanding of basic human biology, particularly as the Human Cell Atlas progresses in its ambitious work identifying and outline all the types of cells that comprise the human body.

This is expected to advance not only basic science, but also the understanding of how drugs work in the body and how to improve drug development by incorporating that knowledge. In the case of Berkeley Lights, it’s focused closely on enabling tools specifically to advance cellular therapeutics.

How it works

The Berkeley Lights Platform is based on single-use optofluidic chips, known as Optoselect, that work to characterize thousands of chips in parallel within nanoliter-sized chambers. They can be used to conduct up to 14,000 discrete analyses by utilizing each of these, which are dubbed Nanopens.

Along with software, reagent kits and advanced automation systems, these provide the basis for the Berkeley Lights Platform. The company markets a trio of advanced automation systems, Beacon and Lighting to run proprietary workflows, as well as Culture Station, which enables high-volume throughput using up to 56,000 Nanopens.

“Nature has demonstrated that cells are both a scalable and sustainable way to develop and manufacture the products we need. And although these cells are capable, they're also quite complex,” said Hobbs. “It's due to this complexity that today we're just beginning to use cells to discover, develop, and manufacture products.

“Now, finding the best cells requires analyzing the function of single cells at scale. And while understanding the genetics is important, it doesn't provide functional validation. We provide functional validation, and we also provide access to the genomics,” he continued. “To give you an example, in our platform, we can find and assess the single cells that kill cancer. We can also find the rare cells that make therapeutic antibodies to cure disease. [A]nd these are just two of the thousands of functions that can be assessed using Digital Cell Biology on the Berkeley Lights Platform.”

At the end of 2019, Berkeley Lights had 45 customers. It had $56.7 million in revenue during 2019, when it also had a net loss of $18.3 million. During the first quarter of 2020, the company had $13.8 million in revenue with $8.4 million in net losses.

The company’s top holders include Walden Riverwood Ventures (22.4% post-IPO stake), co-founder Igor Khandros (19.6%), Sequoia Capital (13.2%) and Nikon Corp. (7.2%).

CKD algorithm

Renalytx AI didn’t see its shares take off in nearly the same way, but it did get a commitment from Mount Sinai Health System, a partner and investor, to buy up to 15% of the new offering. The AI-enabled in vitro diagnostics company aims to make products that will improve patient outcomes and lower health care costs.

First-in-class diagnostics platform Kidneyintelx is an AI-based algorithm that combines various inputs, including validated blood-based biomarkers, inherited genetics and personalized patient data from electronic health record systems to produce a risk score for chronic kidney disease (CKD) patients. It’s designed to identify the highest risk patients to receive subsequent treatment.

Kidneyintelx is a laboratory-developed test for adults with type 2 diabetes, patients with diabetic kidney disease and those with CKD. The test has received breakthrough device designation from FDA, and, crucially, already has the Medicare reimbursement designation known as a CPT code. It expects that partnerships with health care systems, like the one with Mount Sinai, will help to facilitate commercial adoption of Kidneyintelx in the U.S.