Pablo capitalized: Royalty Pharma scores $2.2B IPO — the biggest of the year
A pharma IPO has snatched the crown for the largest US listing of the year.
Royalty Pharma raised $2.2 billion — the exact amount outlined in the latest filing — by pricing at $28 per share, the top of the range. On its first day on the Nasdaq, it’s valued at $16.67 billion.
The company jumped from relative obscurity to (biotech) household fame in less than three weeks, as CEO Pablo Legorreta revealed to Wall Street, after 24 years of shying away from the limelight, just how much revenue the world’s biggest buyer of drug royalties can bring in.
Despite never developing a drug of its own, Royalty Pharma played a crucial role in seeing some familiar blockbusters through, offering $3.3 billion to the Cystic Fibrosis Foundation for its royalties on Vertex’s franchise and $2.85 billion to Biogen to share revenue from the multiple sclerosis drug Tysabri, among others.
The current portfolio, built on $18 billion of hard cash, spans 45 commercial products plus three experimental drugs in late-stage development.
Royalty Pharma’s float marks the second largest pharma IPOs ever, Reuters reported, trailing only behind Zoetis (the animal health-focused Pfizer spinoff). It leads a string of healthcare companies slated for public debuts this week. None are nearly as big — two are early-stage biotechs and two are diagnostics players — but all benefit from a pandemic IPO boom that shows no sign of receding just yet.
Legorreta kept a sizable chunk of stock $RPRX for himself, now worth well over $1 billion. But he’s still got plenty on his plate in what he calls the golden age for innovative financings in biotech.
“There are so many different therapeutic classes that still require huge investment,” he said at the Milken Institute conference in 2018, as quoted by Forbes. “Alzheimer’s for example, and many other diseases. It is a shame to see how the industry has withdrawn from many of those areas … We have to be a little bit more thoughtful the way we go ahead.”