Acelyrin raises $540 million in rare biotech IPO

Acelyrin raises $540 million in rare biotech IPO

Biotech watchers lamenting a fall-off in public listings for biotech companies will take some heart from Acelyrin’s upsized initial public offering, which ended up at the top end of its anticipated range.

The company raised $540 million from the sale of 30 million shares at $18 apiece, in the largest biotech IPO in the US since Sana Biotech went public in early 2021 with a $588 million raise that valued the company at more than $6 billion. The book is due to close on Acelyrin’s IPO next Tuesday.

Los Angeles-based Acelyrin’s post-debut value is likely to be a little more modest – somewhere in the region of $1.7 billion – but is nevertheless a welcome sign that investors are regaining an appetite for biotech IPOs after a desultory 2022, which in turn followed a blockbuster 2021.

Shares in Acelyrin are due to start trading on the Nasdaq later today under the SLRN ticker. That comes the day after Johnson & Johnson’s consumer health spinout Kenvue made its debut on the NYSE, with a healthy 22% jump above the asking price on the day.

Acelyrin will use the proceeds to fund further clinical development of lead drug izokibep, an IL-17A inhibitor in phase 2b/3 trials for hidradenitis suppurativa (HS), psoriatic arthritis (PsA) and uveitis, with a study in axial spondyloarthritis (AxSpA) also planned.

The drug molecule is much smaller than other biologics in the IL-17 class, which includes blockbusters like Novartis’ Cosentyx (secukinumab), and Acelyrin reckons this will allow it to penetrate more deeply into tissues, improving its efficacy.

Top-line data in the phase 2b/3 trial of izokibep in HS is expected in the second half of 2023, with other readouts expected in 2024.

A second candidate, anti-IGF-1R antibody lonigutamab, is in early clinical testing for thyroid eye disease, while the biotech also has a c-KIT inhibitor called SLRN-517 in preclinical development, which it says has potential to treat chronic urticaria.

Acelyrin was co-founded by Shao-Lee Lin (pictured top), formerly chief scientific officer at Horizon Therapeutics – in 2020. It has already secured more than $550 million in committed capital, including a $300 million third round last year.

There were 152 biotech offerings in 2021, raising a massive $25 billion, but they shrank to less than 50 last year, raising around $4 billion.

So far in 2023, there have been only a handful of listings, headed by Mineralys’ $192 million raise and Structure Therapeutics’ $161 million listing in February, with Genelux and Cadrenal Therapeutics raising $15 million and $7 million, respectively, in January.