The dog days of summer are here and IPO activity has slowed, but that hasn’t stopped some biotech companies from securing a place in the line leading to Wall Street. Late Friday, SpringWorks Therapeutics and Satsuma Pharmaceuticals filed paperwork to go public.
SpringWorks spun out of Pfizer (NYSE: PFE) nearly two years ago, aiming to acquire drug candidates that stalled within or were shelved by larger pharmaceutical companies. The Stamford, CT, company set its sights on rare diseases and cancer. To start, it
secured the rights to four compounds that no longer fit Pfizer’s strategy.
The most advanced of those compounds is nirogacestat, a drug that Pfizer had tested in breast cancer. SpringWorks is in late-stage clinical trials testing the small molecule drug in desmoid tumors, which occur in connective tissue. Also called aggressive fibromatosis, the disease can cause pain, swelling, and difficulty using arms, legs, or other parts of the body that are affected, according to the National Organization of Rare Disorders. There are no FDA-approved drugs for desmoid tumors. Although these tumors can be surgically removed, they can grow back, NORD says.
SpringWorks says in its prospectus that it plans to apply some of the IPO proceeds toward a Phase 3 study of nirogacecstat in patients with desmoid tumors that it began in May. Preliminary data are expected in 2021. The company is also testing the drug, which was developed to block a protein called gamma secretase, in multiple myeloma under a partnership with GlaxoSmithKline (NYSE: GSK). That partnership is evaluating nirogacestat in combination with belantamab mafodotin, a GSK cancer drug. GSK is paying for clinical development of this drug combination, which is in Phase 1b testing. An unspecified amount of IPO cash will be used to continue development of earlier-stage compounds in the SpringWorks pipeline.
Since its 2017 launch, SpringWorks has raised more than $228 million, including a $125 million Series B round of funding in April. Its largest shareholders are Pfizer, Bain Capital, and OrbiMed, according to the prospectus. SpringWorks set a preliminary target of $115 million for its IPO. The company has applied for a Nasdaq listing under the stock symbol “SWTX.”
Meanwhile, Satsusma’s focus is treating migraine. The company’s therapeutic candidate, STS101, is a proprietary device developed to administer a formulation of dihydroergotamine mesylate (DHE), a generic drug used to treat acute migraine. The drug is already available via injection and nasal spray. But these forms can be difficult to administer and lead to suboptimal results, Satsuma says in its IPO filing.
Satsusma’s drug-device product consists of a dry powder formulation of DHE that comes prefilled in a single-use nasal delivery device. The company licensed the technology behind the combo from Shin Nippon Biomedical Laboratories (SNBL) of Japan. Last month, Satsuma started a Phase 3 study expected to enroll 1,140 patients. Preliminary data are expected in the first half of next year. The company says it will also start a 12-month safety trial in the second half of 2020. Satuma says in its prospectus that it will use the IPO proceeds to finance those studies. If all goes well, the company expects to file for FDA approval by the end of 2021.
If the Satsuma migraine treatment reaches the market, it will compete against a DHE nasal spray from Bausch Health (NYSE: BHC), as well as DHE injectables made by other companies. Satsuma might also face competition from Seattle-based Impel NeuroPharma, which is currently in late-stage testing of a nasal-delivery device that also administers DHE.
Satsuma set a preliminary $86 million goal for its IPO. The company, which is based in South San Francisco and has an additional office in Research Triangle Park, NC, has applied for a Nasdaq listing under the stock symbol “STSA.” Satsuma last raised money in April when it closed $63 million in Series B financing. The company’s largest shareholders include RA Capital, TPG Biotech, and SNBL.