Gene therapy developer Orchard prices IPO at $14 to raise $200M
UK gene therapy developer Orchard Therapeutics $ORTX priced its initial public offering at $14 (ADS) per share, and is offering about 14.3 million shares, it said on Tuesday. Shares of the London-based startup, which acquired the rights to GSK’s $GSK “bubble boy” disease drug Strimvelis earlier this year, are expected to commence trading on the Nasdaq on Wednesday. The offering comes at a time when the rate of biopharma IPOs has hit a feverish pace,with more such IPOs in the first half of this year than all of 2017.
The gross proceeds from Orchard’s offering — in which JP Morgan, Goldman Sachs and Cowen are acting as joint book-running managers — are expected to be in the range of about $200 million.
Orchard is developing an ex vivo gene therapy in which a patient’s stem cells are extracted and fixed outside the body before being transplanted back in with an aim to treat a variety of rare diseases. GSK in April transferred the rights to its portfolio of rare disease gene therapies, including Strimvelis, to Orchard in exchange for a 19.9% stake after Britain’s biggest drugmaker decided the slate of drugs were too niche for its arsenal of treatments.
Strimvelis was approved in Europe in 2016, and is an expensive but corrective treatment for adenosine deaminase severe combined immunodeficiency (ADA-SCID), but has only been used in a handful of patients.
Before it announced plans to go public, the young biotech, led by individuals who worked on Strimvelis, raised $150 million in a Series C funding round in addition to the $110 million raised in a Series B round late last year.
The funds raised will be used to shepherd the development of Orchard’s three late-stage rare-disease programs: ADA-SCID, metachromatic leukodystrophy (MLD), and Wiskott–Aldrich syndrome (WAS). The company is also developing drugs for X-linked chronic granulomatous disease (X-CGD) and beta-thalassemia, in addition to a clutch of preclinical targets.
The FDA approval of Spark Therapeutics’ $ONCE Luxturna for an inherited form of blindness late in 2017 brought the field of gene-therapies into the spotlight, with a growing list of of drugmakers currently looking for such one-time solutions for genetic disorders that are not properly treated by small molecule drugs and enzyme replacement therapies — treatments that are not designed to target the root cause of the disorders.