Radius Health has raised more than $250 million from private investors to develop an osteoporosis drug to pit against Eli Lilly’s teriparatide (Forteo). Now, after switching CEOs three times and kicking off a big Phase III trial, the Cambridge, MA-based company will see if it can get the same type of financial support on Wall Street.
Radius has become the latest local biotech to file for an IPO. The company is looking to raise as much as $86.25 million through the stock offering in part to finance an ongoing late-stage clinical trial of abaloparatide, an injectable osteoporosis drug it formerly called BA058. Radius aims to trade on the Nasdaq under the ticker symbol “RDUS.” Jefferies, Cowen and Co., Canaccord Genuity, and Cantor Fitzgerald are underwriting the offering.
MPM Capital is Radius’s largest stockholder, with a 28 percent stake. Also holding significant stakes are F2 Biosciences III (20.1 percent), Nordic Bioscience (12.7 percent), Biotech Growth NV (8.4 percent), The Wellcome Trust (7.9 percent), BB Biotech Ventures (6.6 percent), HealthCare Ventures VII (6.3 percent), Brookside Capital Partners Fund (5.9 percent), and Saints Capital (5.1 percent).
Radius was formed in 2003 and originally known as Nuvios. It changed its name in 2005 after acquiring abaloparatide from France’s Ipsen. The draw was that abaloparatide is an anabolic drug that is supposed to build up the bones, rather than just stop them from decaying more than they already have, like the genetic bisphosphonates that women with osteoporosis are typically first prescribed. Radius merged with an unlisted shell company in 2011, and has been reporting publicly with the SEC ever since.
Radius’s drug is supposed to work in the same way as Lilly’s (NYSE: LLY) teriparatide—a blockbuster drug with more than $1 billion in annual sales. So the company has been trying to do two things: First, prove that abaloparatide is more effective than Lilly’s drug at treating osteoporosis. And second, develop a skin patch version of the drug, a differentiator compared to current therapies.
Radius is running a 2,400 patient, 18-month late stage trial pitting its injectable drug candidate head to head with teriparatide. Radius expects to produce top-line results from that study later this year.
But Radius has also gone through a major shakeup recently. The company changed CEOs three times over the course of about a month. First, Michael Wyzga stepped down on Nov. 11. He was replaced by former Clinical Data CEO Andrew Fromkin, who resigned less than two weeks after he was hired, and was then succeeded by Richard Lyttle, one of the company’s founders and the chairman of its scientific advisory board. Then, on Dec. 17, former AstraZeneca executive Robert Ward took over for Lyttle.
Radius hasn’t explained the reason for all the executive upheaval, but it appears to have been tied to the trajectory of the skin patch—a drug Wyzga touted strongly before he left. Harvey, the company’s CFO, told Xconomy in December that Radius originally expected to file a new-drug application for its injection-free skin patch in 2017; he said, at the time, that the company is now anticipating doing so by 2019 (the company didn’t give an exact timeline in its prospectus). Radius released results from a mid-stage study of the patch, known as abaloparatide-TD, first in a quarterly report on Nov. 14. Then, in January, it issued a press release summarizing those results and said the study was successful in that it provided proof of concept of the delivery system.
Even so, the patch wasn’t as effective as Radius had hoped. The company says in its IPO prospectus that it needs to conduct “additional formulation development work,” so that it can achieve efficacy “comparable to that of abaloparatide.” Radius then aims to advance “an optimized abaloparatide-TD product in additional clinical studies and to a Phase 3 bridging study.”
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