$1.6 billion liquid biopsy player Grail files IPO, revealing 2021 commercial plans and a Midas-sized $65M pay package for Hans Bishop
The hunt for the Grail just got a lot easier. In fact, in a few weeks you’ll likely be able to pick up a portion of it on Robin Hood, no coconut horses required.
Grail, the monstrously backed liquid biopsy biotech, has filed for an IPO. No pricing details have been disclosed, but if history is any indicator, the company will have a chance to cap 6 months of booming pandemic-era offerings the way the billion-dollar Dark Knight films would cap the summer blockbuster in their heyday. CEO Hans Bishop has penciled in $100 million for the raise, but that figure has become a standard placeholder until biotechs can gauge exactly how much they can raise.
The S-1 lifts a lid on a group that has operated in relative obscurity over the past few years, known primarily by way of the big-name investors — Jeff Bezos, Illumina and ARCH Venture among them — who poured in $1.6 billion while it was still a private company. It shows, for one, that the company is planning a faster rollout than some may have expected. And it reveals that Bishop, long one of the industry’s highest paid executives, got a princely sum to return from a post-Juno sabbatical.
Like Third Rock-backed Thrive and a few lesser-known rivals, Grail is trying to develop a blood test that can detect cancers more cheaply and earlier than conventional diagnostics can. It’s a goal that could transform cancer treatment, allowing doctors to begin therapy when it’s most effective and catch potentially fatal malignancies while they’re still treatable, but it comes with major technological and financial hurdles.
Today Grail revealed plans to roll out its first major test, called Galleri, next year, setting them up to potentially beat Thrive to market. That promise, the company acknowledges, comes in advance of the actual data to support that test and the rollout could be delayed if Covid-19 again blocks trials, as they did earlier this year. Grail is currently running a trial, called Pathfinder, to see whether the test can prospectively help doctors detect cancer early. They will also use a subset of data an observational study that provided their first validation last year.
The company also plans to roll out a second test that will aid traditional diagnoses in the second half of next year. Subsequent trial data could help expand the indication.
To oversee final development and launch, Grail hired Bishop as CEO last year. The serial executive had worked with ARCH’s Bob Nelsen at Juno Therapeutics, the CAR-T company that Celgene bought for $9 billion. Bishop, who at one point made $88 million in a year at Juno, took home a pay package of $64 million last year, most of it in stock.
For an intra-industry comparison, that’s a little more than the $59 million Moderna CEO Stephané Bancel earned after the mRNA biotech’s IPO and it’s a little less than the $70 million Sarepta’s Doug Ingram made, a figure that ranked him 10th in Bloomberg‘s list of top ten CEOs.
Still, the S-1 also points to the obstacles will face as it looks to transition from a cash-raising company to a profit-generating one. Notably, they will have to secure reimbursement from insurers, particularly in Medicaid, and they acknowledge they will probably “not have broad-based coverage and reimbursement at the initial commercial launch for Galleri.” Long-term, if patients have to pay out-of-pocket, doctors may be unwilling to order it.
They acknowledge, too, that if “competitors’ products do not perform as intended, the market for our products could be impaired” — i.e., if another company has faulty tests, payers and doctors may discount the entire approach. Which means that, although Grail may be racing Thrive and a handful of others to the finish line, they’re also depending on them to deliver.