With US government shutdown over, Gossamer reverts to traditional IPO plan
All Gossamer Bio wants is to go public, and fast. But that hasn’t been easy.
One day before the US shutdown began (December 21), the company filed its prospectus with the SEC in a bid to go public. But the protracted shutdown — which essentially paralyzed the SEC — prompted Gossamer to alter its plans. On January 23 — two days before the government opened — the drug developer announced it was using a risky, rarely used path to forge ahead: Employing a fixed price and foregoing the typically lengthy SEC review of their prospectus to green light the listing in favor of enabling their registration by locking in their IPO price 20 days before making a market debut (February 13).
Now, with the SEC back in full force, the company is asking the agency to to disregard the amended prospectus it filed on January 23, and pay heed to the original prospectus submitted on December 21, but to hasten their review.
“…the registration statement Gossamer Bio filed on January 23, 2019 will no longer become automatically effective…20 calendar days after its filing date. With today’s filing, Gossamer Bio intends to request from the SEC acceleration of the effective date of the registration statement prior to the date that it would have otherwise become automatically effective,” the company said in a statement on Wednesday.
When the company will now debut is unclear. However, the terms of the offering have not changed since January 23. The company plans to offer 14.4 million shares priced at $16/share, which will allow the company to raise roughly $230 million in gross proceeds and list under the symbol $GOSS. Meanwhile, existing stockholders have indicated their interest in purchasing about $100 million in shares in the offering at the IPO price of $16.
The road to an IPO can be long and littered with SEC communication that reflects the agency’s deep dive into the company’s disclosures before the green light is sanctioned, following which investors indicate their enthusiasm or lack thereof by making bids on the higher or lower end of the price band offered. The absence of an explicit SEC endorsement could serve to haunt the company later down the line, if the disclosures made by the company come up short.
The company, originally named FSG Bio, was founded by former Receptos CMO Sheila Gujrathi and Faheem Hasnain, the ex-Receptos CEO, in 2015, shortly after Receptos was bought out by Celgene. The biotech is focused on immunology, inflammation and oncology, has three drugs in the clinic, and another in preclinical testing.