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The Biotech IPO Queue Grows Longer as Five More Companies File

Xconomy National — 

The biotech IPO train is rolling onward, with five more companies climbing aboard. The companies, ranging from a late-stage firm looking to finance Phase 3 studies to preclinical companies laying the groundwork for their first drug trials with human subjects, submitted their paperwork to the SEC late Friday—just before the start of Memorial Day weekend.

Here’s a look at these aspiring public companies, their programs, and their plans for the IPO cash.

Akero Therapeutics set a preliminary $86.2 million target for its IPO. The South San Francisco company is among the growing number of biotechs developing drugs to treat nonalcoholic steatohepatitis (NASH), a type of fatty liver disease that has no FDA-approved therapies. Akero acquired its NASH drug, AKR-001, from Amgen (NASDAQ: AMGN), which the IPO filing shows owns a 5 percent stake in the company.

The Akero drug is an engineered version of fibroblast growth factor 21, a protein that plays a role in metabolism. Akero says its drug is intended to reduce both liver fat and scarring in the organ that is a hallmark of NASH.

If Akero completes the stock offering, it plans to list its shares on the Nasdaq exchange under the stock symbol “AKRO.” So far, Akero has completed Phase 1 studies. According to the IPO prospectus, the FDA on May 24 cleared the company to advance the drug to Phase 2a testing. Akero says in the filing that it plans to use the IPO proceeds to complete mid-stage studies.

Prevail Therapeutics is eyeing a $100 million IPO to continue development of gene therapies to treat neurodegenerative disorders. The New York company’s lead program, PR001, is an experimental treatment for Parkinson’s disease in patients who have a particular genetic mutation. The company says in its prospectus that the drug is also being developed to treat the neurological effects of Gaucher disease, an enzyme deficiency disorder.

Earlier this month, Prevail submitted paperwork to the FDA for the go-ahead to start clinical trials. The company says it will use the IPO proceeds to finance Phase 1/2 studies of its lead drug, and continue development of its preclinical programs in other neurodegenerative disorders. Prevail has applied for a Nasdaq listing under the stock symbol “PRVL.”

Dermavant Sciences is a portfolio company of Roivant Sciences, a firm founded by hedge fund manager Vivek Ramaswamy that scouts for compounds shelved by big pharma companies. Roivant licenses those compounds and builds biotech companies around them.

Roivant is the largest shareholder of London-based Dermavant, holding a 99 percent stake prior to the IPO, according to the prospectus. Dermavant, which focuses on skin drugs, acquired its lead experimental therapy from GlaxoSmithKline (NYSE: GSK). The drug, tapinarof, is a topical cream for psoriasis and atopic dermatitis. This month, Dermavant began a Phase 3 study testing its lead drug in patients who have psoriasis, according to the IPO filing. Preliminary data are expected in the first half of 2020. The company also says a Phase 3 study testing tapinarof in atopic dermatitis could start next year.

Dermavant is targeting a $100 million IPO, and it would list on the Nasdaq under the stock symbol “DRMT.” The company says it will use the IPO proceeds to continue clinical testing of tapinarof, and advance development of other skin drugs in its pipeline.

—Similar to Roivant, BridgeBio seeks out compounds sitting on the shelves of pharmaceutical companies and universities, acquires their rights, and then forms companies to continue development. BridgeBio focuses on experimental treatments for rare genetic disorders. It operates a “hub and spoke” business model, in which the subsidiaries it forms all share in BridgeBio’s resources. But those companies can go out on their own, striking deals with larger pharmaceutical companies or even going public.

BridgeBio’s subsidiaries include skin cancer drug developer PellePharm, which has a partnership with Denmark-based LEO Pharma, and QED Therapeutics, which acquired its drug for a rare pediatric bone disease from Novartis (NYSE: NVS).

In its prospectus, BridgeBio set a preliminary $225 million target for its IPO. It says it will use the proceeds for clinical testing and research and development work at its subsidiaries. The company has applied for a Nasdaq listing under the stock symbol “BBIO.”

—Preclinical biotech Atreca set a preliminary $100 million target for its IPO, which it says will finance development of its cancer immunotherapies. The Redwood City, CA, company say its proprietary technology uses the immune system to guide researchers to discover pairs of antibodies and their targets. Atreca says that its technology has discovered more than 1,400 antibodies that bind to tumor tissue from patients who are not the source of the antibodies. Founded in 2010 based on research from Stanford University, Atreca’s initial research focused on developing new vaccines.

Atreca’s lead drug, ATRC-101, is an antibody that the company says could have applications treating a range of solid tumors. In its IPO filing, Atreca says it expects to submit to the FDA in late 2019 the paperwork for starting human studies. Atreca says it will use the IPO cash to fund development of its lead drug through Phase 1b testing in patients with solid tumors, and also continue work on other programs in its pipeline.

Photo by Flickr user Hernan Pinera via a Creative Commons license