Bellus hopes to fuel up on IPO cash as it squares off with giant Merck on a rival drug
Fueled by a successful Phase I trial treating chronic cough and lured by the promise of taking their lead drug to other applications, Montreal-based Bellus Health is looking to make its debut on Nasdaq with a $60 million IPO.
The public offering could be a major boon to the small Canadian company as it looks to outpace pharma giant Merck in the race to bring a P2X3-blocking drug to market. Blocking the P2X3 receptor is a closely studied method for reducing disorders around hypersensitivity, including most prominently chronic cough.
Merck has already brought their version — gefapixant, or MK-7264 — to Phase III trials for chronic cough treatment, with high hopes in creating a major new franchise program. But Bellus points out in the S-1 filing that in their Phase I trial for BLU-5937 they were able to produce positive results without the taste-altering side effects that have marred Merck’s trials. In Merck’s latest trial, over 70% of patients who received 50 mg experienced taste loss or alteration, compared to 5% of patients in Bellus’s. In July, Bellus began its Phase II trial for chronic cough, which affects 26 million Americans.
No effective treatment currently exists.
Bellus also touts their P2X3 inhibitor as potentially useful against other disorders related to hypersensitivity. In 2020 they will begin a Phase II trial on eczema. The atopic dermatitis field is crowded, but Bellus claims 40-50% of patients are dissatisfied with their treatment.
In June Baird analyst Brian Skorney noted that he viewed BLU-5937 as a differentiated asset, saying it “may over time prove to be the best-in-class P2X3 antagonist.”
Originally called Neurochem, the company was forced to restructure in 2008 after their bid to launch their Alzheimer’s drug failed in a large clinical study. They changed their name and began focusing on orphan drugs, although ALZ-801 was
licensed by Alzheon in 2013.
This will be the second major fundraiser in less than a year for Bellus, as it raised $35 million at $0.95 a share from an equity offering in December.
As of June 30, the company had $42.4 million cash on hand. Bellus hopes to eventually sell BLU-5937 at $300-$600 per patient, per month. Listed in Canada, the company’s shares were trading at $2.04.