Vir Biotechnology assembled its pipeline of infectious disease compounds through deal-making with other drug developers, along with financial support from blue-chip venture capital firms and the non-profit Bill & Melinda Gates Foundation. Now the biotech is turning to the public markets for the cash to continue clinical tests of its most advanced drug candidates.
San Francisco-based Vir set a preliminary $100 million target for its IPO, according to paperwork filed with securities regulators late Tuesday. Vir has applied for a Nasdaq listing under the stock symbol “VIR.”
Vir, founded in 2016, is developing drugs to treat and prevent infectious diseases in both the developed and the developing worlds. When the company formally announced its launch in 2017, CEO George Scangos (pictured above), a former Biogen (NASDAQ: BIIB) and Exelixis (NASDAQ: EXEL) executive, told Xconomy that his company was taking a global approach to drug development. Vir’s infectious disease drugs could be sold in the countries that can afford them, he said. In developing countries that are unable to pay for such treatments, the Gates Foundation could distribute them.
The Gates Foundation was a Vir investor from the beginning, joined by Arch Venture Partners. Robert Nelsen, a managing director at Arch, is a Vir co-founder. Months after Vir’s launch, it revealed financial commitments topping $500 million. The company deployed some of that cash in a series of acquisitions and partnerships. According to the IPO prospectus, Vir paid $32.5 million in cash and stock to acquire Humabs BioMed, a Switzerland-based company developing antibody drugs for serious infections.
Vir is also leveraging the technologies of other companies to develop infectious disease drugs. In 2017, the company paid Cambridge, MA-based Visterra $25 million up front to form a partnership developing treatments for influenza, among other infectious diseases. In a separate pact with Alnylam Pharmaceuticals (NASDAQ: ALNY), Vir is using that Cambridge biotech’s small interfering RNA, or siRNA, technology to develop treatments for hepatitis B and other infectious diseases.
Hepatitis B compound VIR-2218 is the most advanced drug in the Vir pipeline, and is currently in Phase 1/2 testing. In early results so far, Vir says, the subcutaneously administered therapy has led to a “substantial reduction” in hepatitis B surface antigen—a protein on the surface of the virus whose presence indicates a person is infectious. The company says in its prospectus that it expects additional data from the study will become available in the second half of this year.
As of Aug. 15, Vir had 206 employees, including 162 in research and development work, according to the IPO filing. The company spent $55.6 million on R&D in the first half of 2019, a greater than 15 percent increase compared to the same period last year. The company’s cash holdings totaled approximately $356.5 million as of June 30. Vir says it will use that cash along with the IPO proceeds for manufacturing of VIR-2218 and to complete the Phase 1/2 test of the hepatitis B drug.
It will also use the IPO proceeds to advance other programs in its pipeline: antibody drug VR-3434 through a planned Phase 1 study in hepatitis B, and antibody drug VIR-2482 in an ongoing Phase 1/2 study in influenza prevention. Vir says the Gates Foundation will pay for the manufacturing and early clinical development of Vir’s tuberculosis and HIV-prevention programs, both of which are preclinical.
Vir also has rights to technology for reprogramming cytomegalovirus, a virus commonly found in humans, as a vaccine that could potentially treat and prevent infections, according to the filing. The technology, which Vir calls “immune programming,” came to Vir in its 2016 acquisition of Oregon-based TomegaVax. In addition to addressing infectious disease, Vir says this technology could potentially apply to cancer.
Since its inception, Vir has raised $630.7 million, according to the filing. Vir’s largest shareholder is Arch, with a 27 percent stake, followed by SoftBank Vision Fund with 21.2 percent.
Photo by Vir Biotechnology