Monte Rosa takes this week's IPO lead as a nine-figure raise pushes industry total past $9B
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Major League Baseball isn’t the only industry that’s undergoing a reckoning over “sticky stuff,” as Monte Rosa Therapeutics takes its molecular glues public Thursday ready to shake up Nasdaq.
The Boston-based biotech priced its IPO late Wednesday night and plans to start trading Thursday at a launch price of $19 per share. Monte Rosa secured $222.3 million with the offering as biotech continues its record IPO pace: now with 54 companies going public in 2021, the industry is on track to see more than 100 debuts in a calendar year for the first time ever, according to the Endpoints News tally.
And this year’s combined IPO raise? It’s over $9 billion.
If they maintain their pace, both totals would eclipse the marks set during last year’s pandemic-fueled craze, when biotech saw $16.5 billion funneled toward 91 newly public companies, per figures from Nasdaq.
Monte Rosa has blazed a path to the public market ever since it closed a $96 million Series B back in September 2020. CEO Markus Warmuth successfully drummed up investor excitement over the biotech’s “molecular glue” technology that seeks to reprogram how ubiquitin ligases work, a function critical to the process of protein degradation.
While other companies in this space had sought to develop inhibitors, Warmuth said at the time, that approach required targets to have an active site. Monte Rosa’s approach allows the biotech to go after those without such sites, particularly when the historically tricky transcription mechanism is involved.
Warmuth followed up that raise with another $95 million round in March, shortly after which Monte Rosa filed to go public. Having raised enough capital to get its lead program into the clinic, the biotech is earmarking some of the IPO funds for a planned Phase I/II trial.
The program, targeting GSPT1 for some genetically-defined cancers, had been expected to reach the IND phase by the end of 2020, Warmuth told Endpoints last September. Now, though, launching IND-enabling studies isn’t expected until the second half of this year.
Per Monte Rosa’s updated S-1, the company plans to spend only $47 million to $57 million on this study, saving the majority of the funds for its other candidates. The biotech will save about $120 million to $130 million for this effort, bankrolling a quartet of preclinical programs that seek to target CDK2, NEK7, VAV1 and BCL11A in a range of cancers, inflammatory diseases and autoimmune diseases.
At least three of these will hit the IND-enabling phase with the cash, the S-1 says, though it’s unclear which is the furthest ahead. Monte Rosa will set aside the remaining $65 million to $75 million to continue developing its platform.
The biggest winner of the IPO is Versant, which owns the largest stake in the company at 20.5% post-offering. New Enterprise Associates takes home second with a 15.6% share after the IPO finishes, while Cormorant Asset Management clocks in third at 6.1%. Warmuth himself will also take home some cash, given that he owns more than 400,000 shares. Post-IPO, that will equate to a 1% stake in his company.
Monte Rosa plans to trade under the ticker $GLUE. And next up on IPO watch, another quartet of companies are expected to price their IPOs in time for Friday trading, including Graphite Bio, GH Research, Elevation Oncology and Alpha Teknova.