Just how open is the IPO window for biotechs in 2017? After a solid start this year for life sciences offerings, two companies haven’t been able to get to market—the latest being Cambridge, MA-based Visterra.
According to IPO research firm Renaissance Capital, Visterra has postponed an IPO that was supposed to net the firm $50 million. Visterra has been scheduled to price since late January, but had been considered “day-to-day” for a few weeks, according to Renaissance Capital.
Visterra is the second biotech to pull its IPO so far this year after Princeton, NJ-based Braeburn Pharmaceuticals—developing long-lasting injectable and implantable treatments for neurological diseases—postponed a planned $150 million offering last week. Both companies struggled to price despite getting help from insiders to try to complete their offerings. In Braeburn’s case, top shareholder Apple Tree Partners—which already owned 100 percent of the company’s shares, according to an SEC filing—offered to buy $50 million of its IPO, and $40 million in additional shares in a separate deal. Unspecified Visterra stockholders indicated interest in buying $26.4 million, or more than 50 percent, of the company’s IPO.
Yet the three other biotechs to come before Visterra and Braeburn each had success. Cambridge-based Jounce Therapeutics (NASDAQ: JNCE), Swiss firm ObsEva (NASDAQ: OBSV), and San Diego-based AnaptysBio (NASDAQ: ANAB) each priced IPOs in or above their projected ranges, and both Jounce and AnaptysBio sold more shares than they had initially proposed, a sign of high investor interest. Of the three, only Obseva currently trades below its IPO price.
Visterra has been trying to go public for more than a year—it first filed for an IPO in January 2016—and has changed its pitch to investors over that time. (Braeburn, meanwhile, filed its IPO papers in December.)
In January 2016, Visterra’s IPO prospectus said it was focused on antibody drugs for infectious diseases—flu (VIS410) and Dengue fever (VIS513). Those two therapies are still Visterra’s lead programs; VIS410 is in mid-stage testing, while the Dengue treatment should start trials by the end of the year. But the company is now developing different types of antibody drugs for a range of other conditions, from Zika virus to chronic pain to a rare kidney disease called immunoglobulin A nephropathy. (Here’s more on Visterra’s approach and its flu antibody.)
It’s unclear at this point whether Visterra and Braeburn’s struggles are specific to them, or if they signal problems for biotech more broadly. That answer may not come for some time though. According to the upcoming NASDAQ IPO calendar, no other offerings are currently scheduled or even publicly filed. There were 29 biotech IPOs in 2016.