5 days, 11 life science IPOs & more than $1.3B in new capital

Wall Street

Wall Street


Though IPO activity typically slows down in the summer months, this summer has been atypical. The public markets continue to welcome new companies at a breakneck pace, and healthcare is well represented. Of the 20 companies that went public in the last week, 11 of them are doing work in some aspect of the life sciences.

Five of these newly public companies are developing new cancer treatments. Rare disease and heart disease are represented as well. But the biggest biotech IPO belongs to a clinical-stage company that is making progress with vaccine candidates offering the potential to address variants of SARS-CoV-2. According to IPO research firm Renaissance Capital, the 20 IPOs make up the biggest IPO total for a single week since 2000. However, Bill Smith, CEO and co-founder of Renaissance, said this level of activity comes at a price.

“Simply put, investors are tired,” he wrote in the firm’s newsletter published on Sunday. “Combine that fatigue with increased pricing pressure, and performance starts to suffer. Three companies postponed, citing either volatility or market conditions. Of the IPOs that did get done, nearly half priced below the midpoint, and returns were a mixed bag.”

IPO activity might take a break for August. Renaissance notes that new filings have slowed in the runup to these dog days of summer. Here’s a recap of the week’s IPO activity from the life sciences side, mixed bag and all.

Icosavax reels in $182M for clinical trials of its VLP vaccines

Vaccine developer Icosavax had the biggest life sciences IPO of the week, raising $182 million. After initially planning to offer 11.5 million shares in the range of $14 to $16 each, the company was able to boost the deal’s size to 12.1 million shares priced at the midpoint of the targeted price range. Icosavax shares trade on the Nasdaq under the stock symbol “ICVX.” On the company’s first day of trading Thursday, the stock price more than doubled. Shares closed Friday at $34.97, up more than 133% from the IPO price.

Seattle-based Icosavax produces vaccines by engineering proteins to produce virus-like particles that contain no genetic material but resemble a virus closely enough to elicit an immune response. Lead Icosavax vaccine candidate IVX-121 has reached Phase 1 testing in respiratory syncytial virus (RSV). That vaccine is also part of an experimental bivalent vaccine called IVX-A12, which is comprised of the RSV candidate along with a candidate for human metapneumovirus (hMPV), another respiratory virus. Icosavax has also used its VLP platform to develop a SARS-CoV-2 vaccine candidate, IVX-411.

Icosavax plans to spend $120 million to take its bivalent RSV/hMPV vaccine into Phase 2b testing, according to the prospectus. Another $35 million will go toward the development of other vaccines, including advancing the Covid-19 vaccine candidate through Phase 1/2 and Phase 2 testing.

Candel cuts deal size, raises $72M for oncolytic viruses

Candel Therapeutics raised $72 million for its cancer drugs, but it had to shrink the size of the deal to go public. The biotech initially planned to offer more than 6 million shares in the range of $13 to $15 per share. Candel ended up selling 9 million shares for $8 apiece. Those shares trade on the Nasdaq under the stock symbol “CADL.”

Needham, Massachusetts-based Candel is developing oncolytic viral therapies, engineered viruses that kill cancer cells. It has two technology platforms, one using a genetically modified adenovirus and the other based on herpes simplex virus. The adenovirus platform has produced Candel’s most advanced therapeutic candidate, CAN-2409, which is currently in Phase 3 testing in newly diagnosed prostate cancer. According to the IPO filing, the company expects to complete enrollment in the third quarter of this year and report final data in 2024. A separate Phase 3 study testing CAN-2409 in newly diagnosed high-grade glioma is expected to start in the first half of next year. The most advanced program from the herpes simplex virus platform, CAN-3110, is in Phase 1 testing in recurrent high-grade glioma. The IPO cash will go toward clinical trials, including the construction of a manufacturing facility to produce its oncolytic viruses for those studies.

Rare disease biotech Rallybio raises $80.6M from IPO

Rallybio, a clinical-stage developer of therapies for rare diseases, raised $80.6 million from its IPO. The New Haven, Connecticut-based company planned to offer 5.75 million shares. The company ended up selling 6.2 million shares for $13 each, the low end of the $13 to $15 price range it had set. Rallybio shares trade on the Nasdaq under the stock symbol “RLYB.”

The most advanced Rallybio program is RLYB211, a polyclonal antibody in development to prevent fetal and neonatal alloimmune thrombocytopenia (FNAIT). The rare and potentially life-threatening blood disorder develops when platelets of a pregnant woman have a surface protein that the platelets of the fetus see as foreign, sparking antibodies to the protein. The Rallybio lead therapy is in Phase 1/2 testing. According to the prospectus, the company plans to spend $75 million to $83 million to complete the clinical trial. That cash will also support completion of Phase 1 tests of RLYB212, a monoclonal antibody for FNAIT.

IPO brings $166M in new cash for Nuvalent’s cancer drugs

Nuvalent’s IPO raised $165.75 million to advance its cancer drugs to clinical trials. The Cambridge-based biotech planned to offer 8.9 million shares in the range of $16 to $18 each. The company was able to boost the size of the deal to 9.75 million shares priced at the midpoint of the projected price range. Those share trade on the Nasdaq under the stock symbol “NUVL.”

Nuvalent is developing small molecule kinase inhibitors. While drugs from this class have already been approved to treat cancer, the company said in its IPO filing that it designs its small molecules to overcome drug resistance, adverse events, the ability to penetrate into the brain, and other limitations to currently available kinase inhibitors. The company’s two lead programs target cancers driven by genomic alterations in the ROS1 and ALK kinases. According to the IPO filing, between $60 million and $65 million is earmarked for NVL-520, which is being readied for the Phase 1 part of a Phase 1/2 study in ROS1-positive non-small cell lung cancer (NSCLC) and other solid tumors. Another $55 million to $60 million is set aside for NVL-655, which is on track to advance to the Phase 1 portion of a Phase 1/2 study in ALK-positive NSCLC and other advanced cancers.

Omega Therapeutics pulls in $126M for “programmable drugs”

Omega Therapeutics is developing drugs that act on genes. But rather than turning them on or off, the company’s drugs, which it calls epigenomic controllers, are more like a dimmer switch that can dial a gene’s activity up or down. The company’s drugs are comprised of messenger RNA encapsulated in a lipid nanoparticle. The company says its approach has potentially applications in regenerative medicine and immunology. Cancer is the biotech’s first target. Lead program OTX-2002 is being developed to down-regulate c-Myc, a gene frequently dysregulated in cancer.

Cambridge-based Omega priced its offering of 7.4 million shares at $17 each, which was the midpoint of its targeted price range. The company raised $125.8 million to apply to its drug pipeline. According to the IPO filing, the company plans to file the paperwork to begin clinical trials in 2022, evaluating an epigenomic controller as a treatment for liver cancer. Omega’s shares trade on the Nasdaq under the stock symbol “OMGA.”

Tenaya Therapeutics takes in $180M for heart drug R&D

In a crowded field of newly public cancer drug developers, the heart disease focus of Tenaya Therapeutics stands out. But this focus gives it a large addressable market. Heart disease is the leading cause of death worldwide, the company points out in its IPO filing.

San Francisco-based Tenaya aims to treat heart disease with gene therapies, biologics, and small molecules. The company’s most advanced gene therapy program, TN-201, is being prepared for clinical testing as a treatment for hypertrophic cardiomyopathy caused by genetic mutations. The gene therapy is designed to deliver a fully functional version of the mutated gene. The pipeline also includes a small molecule, TYA-11631, with potential applications in heart failure and genetic dilated cardiomyopathy.

Tenaya planned to offer 10 million shares in the range of $14 to $16 each. But the preclinical biotech found enough investor interest to boost the offering to 12 million shares priced at the midpoint of the targeted price range, raising $180 million. The biotech’s shares trade on the Nasdaq under the stock symbol “TNYA.” According to Tenaya’s IPO filing, the company plans to spend $35 million to $40 million on its lead gene therapy and $10 million to $15 million on its lead small molecule, including the planned start of Phase 1/2 testing for both programs.

Immuneering’s IPO raises $112M for a better MEK inhibitor

Immuneering’s IPO raised $112.5 million to bring its lead cancer drug candidate into clinical testing. That program, IMM-1-104, is type of cancer drug called a MEK inhibitor. Other MEK inhibitors have been approved by the FDA previously, but the biotech says in its prospectus that its drug has features that enable it to avoid drug resistance while improving its tolerability. Immuneering expects to file the investigational new drug application paperwork in the first quarter of 2022, with plans to begin a Phase 1 study in patients with advanced solid tumors that characterized by RAS mutations.

Cambridge-based Immuneering offered 7.5 million shares at $15 apiece, which was the midpoint of the projected price range. The company plans to spend between $33 million and $38 million on its lead program; $38 million to $43 million is budgeted for research on its other preclinical programs. The company’s shares trade on the Nasdaq under the stock symbol “IMRX.”

Cancer biotech In8bio prices $40M IPO below targeted price range

IN8bio, a clinical-stage company developing cell therapies for cancer, raised $40 million in its stock market debut. The biotech offered 4 million shares for $8 each, well below the $10 to $12 per share range it had planned.

New York-based IN8bio is developing cell therapies from gamma-delta T cells, which are immune cells that have properties of both the innate and adaptive immune systems. The company said in its IPO filing that these cells can differentiate between healthy and diseased tissue and may kill tumors directly, and also recruit and direct immune cells to kill tumors as well. Lead therapeutic candidate INB-200 is in Phase 1 testing in newly diagnosed glioblastoma; INB-100 is in early-stage testing for treating leukemia patients who are undergoing stem cell transplants. The biotech plans to apply the IPO proceeds toward its ongoing clinical research.

RxSight’s IPO raises $117M for intraocular lens technology

RxSight stands apart from most of this group of newly public life science companies in that it has reached the commercial stage. The RxSight Light Adjustable Lens is an implantable intraocular lens that can be adjusted after surgery. The product is intended to offer better visual outcomes compared to cataract surgeries that replace the lens with one that are not adjustable after the surgery. The FDA approved the RxSight technology in 2017; it also has marketing authorization in Europe and Mexico. The company reported $14.6 million in 2020 sales, a 554% increase over the prior year, according to the prospectus.

Aliso Viejo-based RxSight priced its offering of 7.35 million shares at $16 per share, raising $117.6 million. The company plans to spend $40 million to support commercialization of its product and $44 million on product development, research, and clinical development. RxSight’s shares trade on the Nasdaq under the stock symbol “RXST.”

MaxCyte rides the cell therapy R&D wave to a $175M IPO

MaxCyte, a company that already trades on the London stock exchange operated AIM, raised $175.5 million in its U.S. stock market debut. The company initially planned to offer more than 12 million shares in the range of $11.50 and $13.50 per share. It was able to boost the deal size, selling 13.5 million shares for $13 apiece, raising $175.5 million.

Gaithersburg, Maryland-based MaxCyte has commercialized a proprietary flow electroporation technology, which is used in the engineering of a wide variety of cells for cell therapies. The company’s customers include cell therapy developers, large biopharmaceutical companies, and government and academic institutions. MaxCyte reported $26.1 million in revenue in 2020, a 21% increase over 2019 sales, according to the IPO filing. MaxCyte plans to spend $20 million to $30 million on R&D, including commercialization of its VLX system, which is designed for extremely large volume cell engineering. Another $20 million to $30 million is set aside for manufacturing; and $10 million to $20 million on sales and marketing and business development.

Drug/device company Rani Therapeutics reels in $73M for oral biologics

One of the reasons that biologic drugs come in an injectable and not oral formulation is that these large molecules can’t survive the digestive environment. Rani Therapeutics is developing a capsule that carries a biologic payload that is withstands stomach acid, then, in the upper half of the small intestine, dissolves and exposes a microneedle that injects the drug into the intestinal wall.

San Jose, California-based Rani plans to develop its RaniPill for oral delivery of biologic drugs that are already approved and have been available for years only in injectable form. Phase 1 tests have been completed. Rani said in its IPO filing that it plans to meet with the FDA in the second half of this year to discuss its drug pipeline. Rani’s IPO raised $73 million. The company priced its offering of 6.7 million shares at $11 each, well below the $14 to $16 per share range it projected. Rani shares trade on the Nasdaq under the stock symbol “RANI.”

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