Biotech IPO market heats up as BioHaven’s debut impresses
The biotech IPO market seems to be heating up after three stock market launches in quick succession, including the largest launch seen in the sector this year.
After a boom in 2014 and 2015, biotech IPOs fizzled out last year amid concerns about an attack on drug prices in the US, and this year things got off to a slow start.
Only Jounce’s $104 million debut in January stood out in a sluggish market that saw a series of failures and poorly-supported launches.
But things have picked up since then, with a group of biotechs preparing to go public and a trio of launches this week.
The most eye-catching was Biohaven Pharmaceuticals, which raised $168 million in its quest to develop drugs for neurological diseases such as migraines, as well as rare disorders.
Biohaven has licensed in some unwanted drugs from AstraZeneca and Bristol-Myers Squibb, plus other intellectual property from institutions including Yale University, and Massachusetts General Hospital.
Shares in the Connecticut-based biotech closed at $17.50 on the New York Stock Exchange after launching at $17 – above the expected range of $14 to $16.
Highlights of Biohaven’s pipeline are a small molecule drug, rimegepant, heading into phase 3 trials this year for migraine, and trigriluzole, in phase 2/3 development for spinocerebellar ataxia.
Ovid Therapeutics, under the leadership of Jeremy Levin, the former CEO of Teva, raised $75 million, selling its shares at $15, the low end of the range.
Ovid is developing gaboxadol, a treatment for the rare genetic disorder Angelman syndrome and fragile X syndrome, as well as an epilepsy medicine in partnership with Takeda.
UroGen Pharma also enjoyed a successful IPO, raising just over $58 million, pricing its shares at $13, in the middle of the expected $12-$14 price range.
Tocagen raised $85 million at the start of the second quarter, and Ionis Pharmaceuticals’ lipid disorder subsidiary Akcea, is among the group of companies aiming to go public soon.
The slow start to 2017 means this year is unlikely to produce the record 85 biotech IPOs seen in 2014, but the market seems to be finally picking up.
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