Four biotech Nas­daq wannabes out­line IPO plans — and don't miss Chi-Med's HKEX pitch

If the string of biotech IPO fil­ings the Nas­daq saw on mar­ket close Fri­day says any­thing oth­er than that the win­dow for pub­lic fundrais­ing re­mains wide open, it’s about the di­ver­si­ty of ar­eas these as­pir­ing pub­lic drug­mak­ers op­er­ate in — from im­muno-on­col­o­gy and Alzheimer’s to di­a­bet­ic com­pli­ca­tions and car­dio in­di­ca­tions.

Keep scrolling to read about the lat­est mar­quee Chi­nese bio­phar­ma to file for a list­ing at the Hong Kong stock ex­change — fur­ther de­fus­ing ear­ly wor­ries that the city’s loos­ened rules for biotechs might not be enough to at­tract top play­ers.

Lieping Chen-found­ed Yale spin­off NextCure lines up $86M-plus pub­lic list­ing

Lieping Chen

Last month, Yale spin­out NextCure laid out the blue­print for its im­muno-on­col­o­gy re­search in Na­ture Med­i­cine, af­ter se­cur­ing $40 mil­lion up­front in an R&D col­lab­o­ra­tion with Lil­ly and bring­ing its cash haul to a cool $180 mil­lion. The com­pa­ny — found­ed in 2015 by Lieping Chen, a not­ed I/O re­searcher be­hind Am­plim­mune, a com­pa­ny bought out by As­traZeneca five years ago — is now plan­ning to go pub­lic in an $86.25 mil­lion IPO un­der the sym­bol $NXTC.

The Beltsville, Mary­land-based drug de­vel­op­er is fo­cus­ing on PD-L1-neg­a­tive tu­mors to help the scores of pa­tients for whom check­point in­hibitors don’t work. Its lead ex­per­i­men­tal drug — NC318 — tar­gets an im­munomod­u­la­to­ry re­cep­tor called Siglec-15 and is cur­rent­ly be­ing test­ed in a Phase I/II tri­al in pa­tients with ad­vanced or metasta­t­ic sol­id tu­mors.

Can a bac­te­r­i­al ap­proach to Alzheimer’s win an­oth­er $86M-plus from weary in­vestors?

Bio­gen’s re­cent Phase III dis­as­ter with ad­u­canum­ab dealt a huge blow to the Alzheimer’s field, but it’s al­so opened up an op­por­tu­ni­ty for small­er play­ers to tout how their ap­proach­es are dif­fer­ent. Cor­texyme is seem­ing­ly tak­ing ad­van­tage of that win­dow to push an IPO. The South San Fran­cis­co-based biotech needs the mon­ey to fund a Phase II/III study to ver­i­fy its the­o­ry — cour­tesy of UCSF psy­chi­a­trist Steve Dominy — that a bac­te­r­i­al pathogen called Por­phy­romonas gin­gi­valis plays a ma­jor role in the mem­o­ry wast­ing dis­ease. Cor­texyme’s lead drug, COR388, in­hibits gingi­pains, the tox­ic pro­tease se­cret­ed by P. gin­gi­valis. Backed by Pfiz­er (14.71%) and Take­da (12.32%), the com­pa­ny is now shoot­ing for $86 mil­lion in its pub­lic de­but. Its Nas­daq sym­bol of choice is $CRTX.

New York-based start­up etch­es path to­ward $86 mil­lion IPO

Found­ed in 2016, New York-based drug de­vel­op­er Ap­plied Ther­a­peu­tics has filed for a $86 mil­lion IPO, with plans to list un­der the sym­bol $APLT (no fi­nan­cial de­tails were dis­closed). The com­pa­ny, which has al­ready raised $38 mil­lion in gross pro­ceeds from eq­ui­ty and debt fi­nanc­ings, is work­ing on de­vel­op­ing treat­ments on the ba­sis of val­i­dat­ed path­ways for dis­eases that have so far yield­ed prod­ucts with poor ef­fi­ca­cy and tol­er­a­bil­i­ty. Its lead ex­per­i­men­tal drug — AT-001 — is be­ing eval­u­at­ed for use in di­a­bet­ic car­diomy­opa­thy, a fa­tal fi­bro­sis of the heart, as well as di­a­bet­ic pe­riph­er­al neu­ropa­thy.

Mile­stone aims $86M IPO to push nasal spray for rapid heart rate con­di­tion over fin­ish line

A biotech hail­ing from Cana­da is eye­ing $86 mil­lion in IPO cash to de­vel­op and com­mer­cial­ize its sole as­set: a nasal spray for­mu­la­tion of cal­ci­um chan­nel block­ers. Mile­stone Phar­ma­ceu­ti­cals has cho­sen parox­ys­mal supraven­tric­u­lar tachy­car­dia (PSVT) as etri­pamil’s first tar­get in­di­ca­tion. The rapid heart rate con­di­tion, which of­ten comes with pal­pi­ta­tions, chest pres­sure or pain, short­ness of breath and faint­ing, is usu­al­ly treat­ed with in­tra­venous in­fu­sions in the ER. But Mile­stone (which plans to list un­der $MIST) be­lieves that its rapid-on­set drug can help pa­tients re­solve these sud­den episodes quick­ly on their own. A suc­cess in the on­go­ing Phase III, the com­pa­ny says, will open up a mar­ket of around 2 mil­lion Amer­i­cans. And Phase II pro­grams for atri­al fib­ril­la­tion and angi­na are com­ing up in the next cou­ple of years.

Ven­ture in­vestors col­lec­tive­ly claim more than 80% of the com­pa­ny, with New York-based RTW In­vest­ments, No­vo Hold­ings, Québec’s de­vel­op­ment fund and BDC Cap­i­tal tak­ing the top spots. Ven­rock, Do­main As­so­ci­ates, Pap­pas Cap­i­tal and For­bion split the rest.

A biotech pi­o­neer in Chi­na mo­tions to join the heavy­weight group on HKEX

Mean­while, Chi-Med is kick­ing up some fresh ac­tiv­i­ty on the oth­er side of the At­lantic, fil­ing for what will be its third IPO at the Hong Kong stock ex­change.

Of­fi­cial­ly Hutchi­son Chi­na MediTech, the Hong Kong-based com­pa­ny cel­e­brat­ed a land­mark ap­proval in Chi­na last Sep­tem­ber for a ma­jor can­cer drug that was dis­cov­ered and de­vel­oped in the coun­try. Elu­nate — per­haps bet­ter known as fruquin­tinib, part­nered with Eli Lil­ly — is mar­ket­ed as a col­orec­tal can­cer treat­ment.

But loom­ing larg­er in its glob­al game plan is savoli­tinib, a MET in­hibitor that Chi-Med is pair­ing with part­ner As­traZeneca’s Tagris­so in a Phase II study. Re­cent da­ta from AACR bol­stered their claim that the savoli­tinib add-on can tam­per re­sis­tance among EGFR lung can­cer pa­tients. Throw in the neu­roen­docrine tu­mor drug su­r­u­fa­tinib, and you have the trio of drugs at the top of Chi-Med’s spend­ing list, primed for reg­is­tra­tional tri­als and quick NDAs.

Chris­t­ian Hogg

“We are tar­get­ing two fur­ther new drug ap­provals over the next two years, on savoli­tinib and su­r­u­fa­tinib, sub­ject to pos­i­tive clin­i­cal out­comes,” said CEO Chris­t­ian Hogg, who counts him­self as the pre­cur­sor to the now 420-mem­ber sci­en­tif­ic team.

Pre­vi­ous list­ings on the Nas­daq $HCM and the Lon­don Stock Ex­change (AIM: $HCM) left Hong Kong bil­lion­aire Li Ka-Shing’s CK Hutchi­son un­touched as the ma­jor­i­ty share­hold­er, own­ing 60.2% of the stock. But with the new list­ing in Hong Kong, it plans to cut back its shares to less than 50% such that Chi-Med will of­fi­cial­ly no longer be a sub­sidiary of CK Hutchi­son.

 


By Na­tal­ie Grover and Am­ber Tong

Im­age: Shut­ter­stock

Brent Saunders [Getty Photos]

UP­DAT­ED: Ab­b­Vie seals $63B deal to buy a trou­bled Al­ler­gan — spelling out $1B in R&D cuts

Brent Saunders has found his way out of the current fix he’s in at Allergan $AGN. He’s selling the company to AbbVie for $63 billion in the latest example of the hot M&A market in biopharma.

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Richard Gonzalez testifying in front of Senate Finance Committee, February 2019 [AP Images]

Ab­b­Vie's $63B buy­out spot­lights the re­turn of ma­jor M&A deals — de­spite the back­lash

Big time M&A is back. But for how long?

Over the past 18 months we’ve now seen three ma­jor buy­outs an­nounced: Take­da/Shire; Bris­tol-My­ers/Cel­gene and now Ab­b­Vie/Al­ler­gan. And with this lat­est deal it’s in­creas­ing­ly clear that the sharp fall from grace suf­fered by high-pro­file play­ers which have seen their share prices blast­ed has cre­at­ed an open­ing for the growth play­ers in big phar­ma to up their game — in sharp con­trast to the pop­u­lar bolt-on deals that have been dri­ving the growth strat­e­gy at No­var­tis, Mer­ck, Roche and oth­ers.

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Tasly Bio­phar­ma pitch­es long-await­ed IPO — will it trig­ger an­oth­er $1B gold rush on HKEX?

In the run up to the Hong Kong stock ex­change’s an­tic­i­pat­ed rule change — open­ing the door for Chi­nese pre-rev­enue biotechs to go pub­lic clos­er to home — more than a year ago, Tasly Bio­phar­ma was one of the big play­ers whose ru­mored in­ter­est helped stoke en­thu­si­asm for the new list­ing venue. The com­pa­ny has since kept the drum­roll rum­bling in the back­ground, rais­ing a pre-IPO round and con­vinc­ing part­ner Trans­gene to swap own­er­ship in a joint ven­ture for eq­ui­ty. Now the oth­er shoe has fi­nal­ly dropped as ex­ecs out­line plans for a pipeline dom­i­nat­ed by car­dio­vas­cu­lar drugs.

UP­DAT­ED: In sur­prise switch, Bris­tol-My­ers is sell­ing off block­buster Ote­zla, promis­ing to com­plete Cel­gene ac­qui­si­tion — just lat­er

Apart from revealing its checkpoint inhibitor Opdivo blew a big liver cancer study on Monday, Bristol-Myers Squibb said its plans to swallow Celgene will require the sale of blockbuster psoriasis treatment Otezla to keep the Federal Trade Commission (FTC) at bay.

The announcement — which has potentially delayed the completion of the takeover to early 2020 — irked investors, triggering the New York-based drugmaker’s shares to tumble Monday morning in premarket trading.

Celgene’s Otezla, approved in 2014 for psoriasis and psoriatic arthritis, is a rising star. It generated global sales of $1.6 billion last year, up from the nearly $1.3 billion in 2017. Apart from the partial overlap of Bristol-Myers injectable Orencia, the company’s rival oral TYK2 psoriasis drug is in late-stage development, after the firm posted encouraging mid-stage data on the drug, BMS-986165, last fall. With Monday’s decision, it appears Bristol-Myers is favoring its experimental drug, and discounting Otezla’s future.

The move blindsided some analysts. Credit Suisse’s Vamil Divan noted just days ago:

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SQZ, Ery­tech kick off $57M cell ther­a­py part­ner­ship; Jean-Paul Kress lands new CEO gig at Mor­phoSys

→ In a mar­riage of two tech­nolo­gies meant to make cell ther­a­pies more pow­er­ful, SQZ Biotech is team­ing up with France’s Ery­tech Phar­ma for a col­lab­o­ra­tion, with $57 mil­lion re­served for the first project and $50 mil­lion for each sub­se­quent ap­proval (prod­uct or in­di­ca­tion). Hav­ing ac­cess to Ery­tech’s method of fash­ion­ing ther­a­peu­tics from red blood cells, the Cam­bridge, MA-based com­pa­ny said, will am­pli­fy SQZ’s cell en­gi­neer­ing ca­pa­bil­i­ties and al­low them to de­vleop a new class of im­munomod­u­la­to­ry ther­a­pies. Its own tech — so far ap­plied in can­cer but al­so has po­ten­tial in di­a­betes — tem­po­rary dis­rupts the cell mem­brane by squeez­ing the cell, thus cre­at­ing a brief win­dow for tar­get ma­te­ri­als such as anti­gens to en­ter.

Novotech CEO Dr. John Moller

Novotech CRO Award­ed Frost & Sul­li­van Best Biotech CRO Asia-Pa­cif­ic 2019

Known in the in­dus­try as the Asia-Pa­cif­ic CRO, Novotech is now lead CRO ser­vices provider for the grow­ing num­ber of in­ter­na­tion­al biotechs se­lect­ing the re­gion for their stud­ies.

Re­flect­ing this Asia-Pa­cif­ic growth, Novotech staff num­bers are up 20% since De­cem­ber 2018 to 600 in-house clin­i­cal re­search peo­ple across a full range of ser­vices, across the re­gion.

Novotech’s ca­pa­bil­i­ties have been rec­og­nized by an­a­lysts like Frost & Sul­li­van, most re­cent­ly with the pres­ti­gious Asia-Pa­cif­ic CRO Biotech of the year award for best prac­tices in clin­i­cal re­search for biotechs for the fifth year. See oth­er awards here.

FDA re­jects Ac­er's rare dis­ease drug, asks for new tri­al — shares crater

Ac­er Ther­a­peu­tics’ bid to re­pur­pose celipro­lol — a be­ta-block­er on the mar­ket for hy­per­ten­sion — as a treat­ment for a rare, in­her­it­ed con­nec­tive tis­sue dis­or­der has hit a se­vere set­back. The New­ton, Mass­a­chu­setts-based com­pa­ny on Tues­day said the FDA re­ject­ed the drug and has asked for an­oth­er clin­i­cal tri­al.

The com­pa­ny’s shares $AC­ER cratered near­ly 77% to $4.47 in Tues­day morn­ing trad­ing.

With 4 more biotech IPOs due to wrap up Q2, how is the class of 2019 far­ing?

With 22 biotech IPOs on the books and four more set to price in the last week of June, in­vest­ment ad­vis­er Re­nais­sance Cap­i­tal has tak­en the pulse of the re­cent rush.

By the IPO ex­perts’ count, 25 out of 32 health­care of­fer­ings this year have been from biotechs — dif­fer­ing slight­ly from Brad Lon­car’s tal­ly — and the over­all pic­ture is one of un­der­per­for­mance. While they av­er­aged a first-day re­turn of 9.0%, col­lec­tive­ly they have trad­ed down to a 5.9% re­turn. Turn­ing Point $TP­TX and Cor­texyme $CRTX emerged on top at the half-year mark, ris­ing 135% and 109% re­spec­tive­ly.

Eye­ing a $500M peak sales pot, Almi­rall dou­bles down on le­brik­izum­ab as Der­mi­ra lines up PhI­II

With eyes on what it be­lieves is a $500 mil­lion peak rev­enue op­por­tu­ni­ty in Eu­rope, Barcelona-based Almi­rall has stepped up with $50 mil­lion in cash to take up the op­tion on Der­mi­ra’s IL-13 an­ti-in­flam­ma­to­ry drug le­brik­izum­ab just ahead of the start of Phase III. And there’s an­oth­er $30 mil­lion due as the late-stage pro­gram gets geared up.

That shouldn’t be long from now, as Der­mi­ra ex­pects to be­gin the late-stage tri­al work for atopic der­mati­tis be­fore the end of this year as it fol­lows a trail that ex­ecs in­sist leads to block­buster re­turns. Along the way, they’ll need to take on the 600-pound go­ril­la in atopic der­mati­tis: the IL-13/IL-4 drug Dupix­ent, from Re­gen­eron and Sanofi. Ri­vals al­so in­clude Leo Phar­ma, in its piv­otal with tralok­izum­ab, and Anap­tys­Bio in the hunt with a mid-stage pro­gram for etokimab, pre­vi­ous­ly re­ferred to as ANB020.