Two biotechs new to Nasdaq sparked more investor interest than originally expected Wednesday, hauling upsized IPOs that are yet another indication of the industry’s rip-roaring state.
In one of the chunkier IPOs this year, Germany’s MorphoSys $MOR raised upwards of $207.8 million. That’s nearly $58 million more than the company’s early expectations. The company, which is also listed on a German exchange, says it’s gathering resources to sink $225 million into the development of its investigational anti-CD19 antibody MOR208.
The company has plans to seize a quick OK of MOR208, a drug it’s developing for diffuse large B cell lymphoma (DLBCL) and a popular disease target in oncology. After its last batch of upbeat data from a Phase II study, MorphoSys, which already received breakthrough status for the drug, said it went straight to regulators hoping for early approval.
MorphoSys, which brought in $83 million in revenue last year and already had a good bit of cash in the bank pre-IPO, said it will spend an additional $90 million to build out its commercial infrastructure so it can handle MOR208’s launch.
MorphoSys was joined in IPO glory by yet another cancer drugmaker, Surface Oncology. The startup, founded in 2014, had filed an S-1 back in March signaling a $75 million IPO was in the works. But when the company priced its offering Wednesday, that figure leaped to $108 million. The company will list under the ticker $SURF on the Nasdaq.
On top of the IPO proceeds, Surface raised an additional $11.5 million through the sale of 766,666 shares to Novartis Institutes for Biomedical Research at the IPO price. Novartis has been involved with Surface since its early days and was among the investors in the company’s Series A round in 2015.
The Cambridge, MA-based biotech has attracted considerable attention for its work in the intensely competitive field of tumor microenvironment engineering. Surface is one of a myriad of startups looking to add some additional firepower that can either take the brakes off of an immune assault or bring in additional weapons to take down cancer cells. In their case, the key focus is on countering immunosuppression.
In particular, Surface develops drugs to block an unusually abundant protein on the surface of tumors called CD47, which helps tumors fight off attack from immune cells. In preclinical research, Surface reported that certain immune cells showed greater tumor-killing power in the drug’s presence.
The company’s IPO proceeds will finance its Phase I drug program SRF231, which is being tested in patients with multiple tumor types. Surface says in its S-1 filing that it plans to test the drug as a solo therapy and along with FDA-approved cancer drugs in a combo treatment.
The burst of investment in immuno-oncology has left Surface with a long roster of rivals. For CD47 alone, competitors include Alexo Therapeutics, Arch Oncology, Aurigene, Blink Biomedical, Celgene, Forty Seven, Novimmune, OSE Immunotherapeutics, Sorrento, Synthon Holding and Trillium Therapeutics.
Surface expects to report initial results from its Phase I study in the first half of next year.
The best place to read Endpoints News? In your inbox.
Comprehensive daily news report for those who discover, develop, and market drugs. Join 33,500+ biopharma pros who read Endpoints News by email every day.Free Subscription