BioWorld International Correspondent
OctoPlus Technologies NV went public on the Euronext Exchange in Amsterdam in a transaction that raised gross proceeds of €20 million (US$25.1 million). The IPO was priced last week at €4.65 per share, the bottom of the estimated price range of €4.65 to €5.50.
The stock, which began trading last Wednesday under the symbol "OCTO," dipped slightly during its first day on the market to close at €4.59. It weakened further during successive trading sessions. By noon Amsterdam time Tuesday, it was changing hands at €4.13, down almost 11.2 percent to the IPO price.
Investor sentiment toward biotechnology in the Benelux region has weakened following a strong run in 2004 and 2005, said Mark Van Der Geest, analyst at Rabo Securities in Amsterdam, the Netherlands.
"Somewhere in the first half of this year it started to soften," he said. Liege, Belgium-based Oncomethylome Sciences SA, which grossed €25.3 million in an IPO on the Euronext in Brussels and Amsterdam in June, also had a difficult time, he said, although it is currently trading at about €8, above its IPO price of €7.50.
The IPO comprised about 4.3 million new shares, following which the Leiden, Netherlands-based company had 16.2 million ordinary shares outstanding.
OctoPlus would gross about €3 million more if the underwriters exercise an overallotment option on an additional 645,161 shares. Cowen International Ltd., part of New York-based Cowen Group Inc., and Fortis SA, of Brussels, Belgium, were joint bookrunners and joint global coordinators on the IPO. Amsterdam-based Kempen & Co. acted as co-manager.
The company opted to float at this point for several reasons, Chief Financial Officer Hans Pauli told BioWorld International.
It needed additional cash, and the public market in the Benelux region was more receptive to a financing transaction of that scale than the private equity market. The additional visibility also will aid the company's contract development business and will help to attract new hires.
OctoPlus was established in 1995 by CEO Joost Holthuis and Daan Crommelin, chairman of the company's scientific advisory board and currently scientific director of the government-backed TOP Institute Pharma in Leiden.
It began as a contract development organization, an activity that generated €7 million in revenues in 2005 and €3.3 million during the first half of 2006. Its focus within that area on drug delivery, formulation of active pharmaceutical ingredients and clinical-scale manufacturing.
More recently, the company added product development activity as well. It has three programs in the clinic, including OP-145, a peptide licensed from the Leiden University Medical Center, in development for treatment of chronic middle ear infection.
A Phase II trial currently is enrolling. "We expect to be able to receive and publish the Phase II data 12 months from now," Pauli said. The company has entered a nonbinding term sheet with Seoul, South Korea-based Green Cross Corp. covering the licensing of the product in South Korea for chronic middle ear infection. It is seeking partners for other territories and for other indications.
It also has Locteron, a controlled-release formulation of interferon-alpha in development for hepatitis C infection. The product, which OctoPlus is developing in a collaboration with Biolex Therapeutics Inc., of Pittsboro, N.C., is based on OctoPlus' PolyActive drug delivery technology and is entering a Phase IIa trial in the this quarter.
"Before the summer of next year, we will have the Phase IIa data available," Pauli said. Because it is a known entity, demonstrating evidence of efficacy in a Phase I trial was a significant milestone, he said. "A very large hurdle to take is to show your proof of concept in Phase I."
In Phase I trials, OctoPlus has hGH-Octodex , a once-per-week formulation of human growth hormone, which is in development for hGH deficiency.
OctoPlus also has two preclinical vaccine development programs under way. JE-OctoVax, which the company is developing in collaboration with Singapore-based SingVax Pte. Ltd., is a single-shot vaccine for preventing Japanese encephalitis virus infection. It also is working on single-short vaccines for hepatitis B infection with SciGen Ltd., also of Singapore.