Genenta is attempting a rare biotech leap from Milan to Wall Street
Pierluigi Paracchi, CEO and one of the trio of leaders running gene therapy biotech Genenta, has frequently lamented the absence of Italian biotechs on Nasdaq. And now, he’s taking his Milan-based company and jumping out in front of what he hopes someday will be a pack of biotechs going public in the US.
The Italian biotech has been busy recently with Phase I/II trials on their investigational glioblastoma candidate Temferon — and it’s looking to expand with an IPO. The six-year-old small biotech, founded out of the renowned San Raffaele Hospital in Milan — led by a biotech executive, a noted academic and a physician — filed a Form F-1 with the SEC on Tuesday, penciling in a planned raise of $35 million, though that’s been known to change in the leadup to the flip onto Wall Street.
Genenta has not raised a ton of money compared to other biotechs — unlike some firms that will raise hundreds of millions of dollars over multiple rounds, Genenta raised just under $38.6 million in three rounds.
And according to the F-1, they plan to keep that trend going.
So what is the money going to? The F-1 said $25.3 million to finish up the current Temferon study, start up a Phase II study, pay for manufacturing activities, and more.
Anything else they raise will go towards the typical: ongoing business development activities, operating costs and “other general corporate purposes.”
To date, the company has been privately held — so who owns the company and who are its investors?
The hospital backer and two of the founders own a notable chunk of the shares. CEO Paracchi owns more than 2.2 million shares — a nice chunk at 15% of the company’s 15 million shares.
Scientific co-founder Luigi Naldini — a scientist with an impressive background in gene therapy and the former president of the European Society of Gene and Cell Therapy — has close to 1.4 million shares, and the Milan hospital has about 1.9 million shares — leveraging close to 36% control of Genenta between the three.
And Spafid S.p.A — an Italian bank in Milan — is the largest stockholder with 3.4 million shares or 22%.
When Genenta was first founded in 2014, $11.4 million in shares were issued and purchased by “accredited investors,” according to the F-1. These investors included affiliates of the Ferrari family — and an unnamed early investor in Advanced Accelerator Applications, the biotech that was acquired by Novartis for just under $4 billion in 2017.
On June 27, 2017, just over $8 million was approved by shareholders — and purchased by Italian, British, and Swiss private investors, family offices, and angel investors, including the holding company for the former owners of Rottapharm, the Rovati family. Other investors included other early investors in AAAP and Giuseppe Vita, former chairman of Schering-Plough, which merged with Merck back in ’09.
After this round of shares, then-head of Novartis in Europe Guido Guidi joined Genenta’s board as one of its directors.
Following in 2019, another close to $19 million was further approved — with Chinese private equity firm Qianzhan Investment Management taking the lead. And finally, another $1.7 million was issued last year.
In other IPO news, Vaxxinity priced this morning at only $13 a share, under the expected $14-$16 a share. The Dallas biotech is also releasing just 6 million shares for a total of $78 million it’s hoping to raise — more than 10% under the expected 6.7 million shares.
This pricing reflects how the market is getting more difficult — and unforgiving — for biotechs now looking to make the leap from privately-held to public.