Mod­er­na boosts uni­corn sta­tus with a whop­ping $500M raise and $7B val­u­a­tion

Stéphane Ban­cel, Mod­er­na CEO

The biotech world’s biggest uni­corn just raised $500 mil­lion, bring­ing its to­tal haul to about $2.5 bil­lion from part­ner­ships and in­vestors while valu­ing the com­pa­ny at close to $7 bil­lion.

This year Mod­er­na will burn through about $450 mil­lion, the ex­ec­u­tive team tells me to­day. And with this new fi­nanc­ing, the com­pa­ny has three years of run­way — plen­ty of time to fig­ure out the right tim­ing for an even­tu­al IPO.

“We al­ways like to have sev­er­al years of cap­i­tal,” says CEO Stéphane Ban­cel. “And we want to keep on ex­pand­ing the in­vestor base.”

They ac­com­plished that goal in style.

Mod­er­na raised the cash from a broad, glob­al syn­di­cate that stretched from the Mid­dle East to Eu­rope and on to Chi­na. The group in­clud­ed the Abu Dhabi In­vest­ment Au­thor­i­ty, BB Biotech AG, Julius Baer, Sin­ga­pore-based ED­BI and Se­quoia Cap­i­tal Chi­na. Ex­ist­ing in­vestors that al­so par­tic­i­pat­ed in this round in­clude Fi­deli­ty Man­age­ment and Re­search, Pictet, Viking Glob­al In­vestors, Ar­row­Mark Part­ners and Alexan­dria Ven­ture In­vest­ments.

With the raise, the com­pa­ny has $1.4 bil­lion in cash in the bank, and an­oth­er $250 mil­lion com­ing from es­tab­lished grants. That trea­sure trove will be used to back a staff that has grown in­to the hun­dreds, with ded­i­cat­ed man­u­fac­tur­ing sup­port and a host of big part­ners work­ing with them on de­vel­op­ment pro­grams.

That leaves every­one ask­ing the same big ques­tion: When will Mod­er­na go pub­lic?

“We’re not pre­pared to go there,” re­spond­ed CFO Lorence Kim when I asked. “With this cap­i­tal we will now look at the ad­vance­ment of our pro­grams through and in the clin­ic” as they pon­der the right next step on fi­nanc­ing.

But it’s cer­tain­ly on the radar. Adds Kim: “We are be­gin­ning the process of prepar­ing and eval­u­at­ing the costs and in­fra­struc­ture of be­ing pub­lic.”

For a pri­vate biotech with deep-pock­et in­vestors back­ing it, Mod­er­na has stirred some pow­er­ful feel­ings — both pro and con — in the Cam­bridge/Boston biotech hub where it’s based.

Noubar Afeyan

Sup­port­ers look at a broad­en­ing pipeline that cur­rent­ly has 19 pro­grams in clin­i­cal de­vel­op­ment for a po­ten­tial­ly break­through ap­proach us­ing mes­sen­ger RNA, as of the most re­cent up­date at JP­Mor­gan. And Noubar Afeyan, the chief at Flag­ship, has made it a prime ex­am­ple of the kind of ma­jor league play­er he wants to bring up from the AAA.

For them, Mod­er­na is part of the new breed of biotechs.

Crit­ics have hit the com­pa­ny for a huge val­u­a­tion that’s ex­tra­or­di­nary for a biotech that has no mar­ket­ed prod­ucts and a pipeline that still has some ma­jor strides to go be­fore get­ting in­to late-stage de­vel­op­ment. For that crowd, the big mon­ey and pay­roll at Mod­er­na are a sign of pure froth in an over­heat­ed mar­ket.

For them, Mod­er­na is an aber­ra­tion that threat­ens to crum­ble.

Love them or hate them, though, Mod­er­na is play­ing for all the mar­bles, and this lat­est $500 mil­lion raise and multi­bil­lion-dol­lar val­u­a­tion speaks to their suc­cess in get­ting some well heeled back­ers to go very deep, and very long, in giv­ing them the funds to go all the way.

Oxitec biologist releases genetically modified mosquitoes in Piracicaba, Brazil in 2016 [credit: Getty Images]

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But when a group of independent scientists evaluated the impact of the release of these genetically-modified mosquitoes in a trial conducted by Oxitec in Brazil between 2013 and 2015, they found that some of the offspring had managed to survive — prompting them to speculate what impact the survivors could have on disease transmission and/or insecticide resistance.

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[via AP Images]

Pur­due threat­ens to walk away from set­tle­ment, asks to pay em­ploy­ees mil­lions in bonus­es

There are two updates on the lawsuit against Purdue Pharma over its role in fueling the opioid epidemic, as the Sackler family threatens to walk away from their pledge to pay out $3 billion if a bankruptcy judge does not stop outstanding state lawsuits against them. At the same time, the company has asked permission to pay millions in bonuses to select employees.

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As Nas­daq en­rolls the fi­nal batch of 2019 IPOs, how have the num­bers com­pared to past years?

IGM Biosciences’ upsized IPO haul, coming after SpringWorks’ sizable public debut, has revved up some momentum for the last rush of biotech IPOs in 2019.

With 39 new listings on the books and roughly two more months to go before winding down, Nasdaq’s head of healthcare listings Jordan Saxe sees the exchange marking 50 to 60 biopharma IPOs for the year.

“December 15 is usually the last possible day that companies will price,” he said, as companies get ready for business talks at the annual JP Morgan Healthcare Conference in January.

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Aerial view of Genentech's campus in South San Francisco [Credit: Getty]

Genen­tech sub­mits a plan to near­ly dou­ble its South San Fran­cis­co foot­print

The sign is still there, a quaint reminder of whitewashed concrete not 5 miles from Genentech’s sprawling, chrome-and-glass campus: South Francisco The Industrial City. 

The city keeps the old sign, first erected in 1923, as a tourist site and a kind of civic memento to the days it packed meat, milled lumber and burned enough steel to earn the moniker “Smokestack of the Peninsula.” But the real indication of where you are and how much has changed both in San Francisco and in the global economy since a couple researchers and investors rented out an empty warehouse 40 years ago comes in a far smaller blue sign, resembling a Rotary Club post, off the highway: South San Francisco, The Birthplace of Biotech.

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David Grainger [file photo]

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While No­var­tis ban­ish­es Zol­gens­ma scan­dal scars — Bio­gen goes on a Spin­raza 'of­fen­sive'

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The US drugmaker $BIIB secured US approval for Spinraza for use in the often fatal genetic disease in 2016. The approval covered a broad range of patients with infantile-onset (most likely to develop Type 1) SMA. 

Jason Kelly. Mike Blake/Reuters via Adobe

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UP­DAT­ED: Speak­er Nan­cy Pelosi to un­veil bill for fed­er­al­ly ne­go­ti­at­ed drug prices

After months of buzz from both sides of the aisle, Speaker Nancy Pelosi will today introduce her plan to allow the federal government to negotiate prices for 250 prescription drugs, setting up a showdown with a pharmaceutical industry working overtime to prevent it.

The need to limit drug prices is a rare point of agreement between President Trump and Democrats, although the president has yet to comment on the proposal and will likely face pressure to back a more conservative option or no bill at all. Republican Senator Chuck Grassley is reportedly lobbying his fellow party members on a more modest proposal he negotiated with Democratic Senator Ron Wyden in July.