An industry favorite from the past is returning to center stage this week to lead the IPO calendar. Yes, the bio-IPOs are back in town. The recent deals from the technology sector (SecureWorks – SCWX) and the world of gambling (Red Rock Resorts – RRR) did not work out.
This week’s IPO calendar has four names. Two are new faces at the window and two are from past calendars. The new faces are Intellia Therapeutics (NTLA – proposed) and Oncobiologics (ONS – proposed). Returning for another try to get out the door are Cancer Prevention Pharmaceuticals (CPP – proposed) and Spring Bank Pharmaceuticals (SBPH – proposed). The four deals are expected to raise about $185 million, but more on each in a minute.
Some Numbers Worth Knowing
Let’s review the 2016 IPO traffic. Over the last four months, a total of 13 deals were priced, according to the U.S. Securities and Exchange Commission filings. This excludes unit offerings, bank conversions, blank checks and foreign traded securities making their debuts in the U.S. capital markets. The latter are public offerings as investors can buy the underlying shares before their U.S. pricing dates.
Of this year’s 13 IPOs, eight are health-care related, which are generally referred to as bio-techs. Here is their scorecard, as of April 29, 2016:
Of the eight bio-IPOs, two were priced above their original filing ranges, three within range and three below. Their opening-day scorecard stood at four up and four down. The average opening-day gain for all eight was 5.31 percent.
Now here is where it gets interesting.
As of Friday’s close, the scorecard for the bio-IPOs stood at six up and two down. The average gain was 24.1 percent.
In contrast, the Nasdaq Composite Index, the barometer of the IPO market, was down 4.63 percent for the year.
Gather Your Intelligence
Now back to this week and its bio-IPOs. The word around the Street is Intellia Therapeutics is on everybody’s “buy” list.
Intellia Therapeutics is a Cambridge, Massachusetts-based gene editing company focused on developing therapeutics using a biological tool known as the CRISPR/Cas9 system. The company believes that the CRISPR/Cas9 technology has the potential to transform medicine by permanently editing disease-associated genes in the human body with a single course of treatment.
The buzz: Regeneron Pharmaceuticals (REGN) and Novartis Institutes for Biomedical Research – Intellia’s collaboration partners – have agreed to purchase $50 million and $5 million, respectively, of Intellia’s common stock in separate private placements concurrent with the completion of this offering. Certain existing investors have indicated an interest in buying up to $30 million worth of common stock in this IPO.
Bankers plan to price 5 million shares at $16 to $18 each on Thursday evening, May 5, to trade on Friday morning, May 6.
Oncobiologics is a Cranbury, New Jersey-based clinical-stage biopharmaceutical company focused on complex biosimilar therapeutics. The company’s current focus is on technically challenging and commercially attractive monoclonal antibodies, or mAbs, in the disease areas of immunology and oncology.
The buzz: Certain existing investors have indicated an interest in buying up to $20 million worth of common stock in this IPO.
Bankers plan to price 5 million shares at $11 to $13 each on Thursday evening, May 5, to trade on Friday morning, May 6.
Two Blasts from the Past
Cancer Prevention is a Tucson, Arizona-based clinical-stage biopharmaceutical company formed to develop and commercialize therapeutic agents to treat and prevent certain pre-cancerous conditions, orphan diseases and gastrointestinal conditions.
Bankers plan to price 1.9 million shares at $12 to $14 each on Thursday evening, May 5, to trade on Friday morning, May 6.
Spring Bank Pharmaceuticals is a Milford, Massachusetts-based clinical-stage biopharmaceutical company developing a novel class of antiviral therapeutics using its proprietary small molecule nucleic acid hybrid (SMNH) chemistry platform. This year, the company plans to conduct two clinical trials of an SMNH drug candidate known as SB 9200 – one trial to treat adults infected with the Hepatitis B virus, while the other trial will treat healthy adult volunteers inoculated with the respiratory syncytial virus (RSV) – according to the prospectus. RSV can kill premature babies, people over age 65, people with heart and lung disease, and people with weak immune systems.
Bankers plan to price 1.1 million shares at $12 to $14 each on Thursday evening, May 5, to trade on Friday morning, May 6.
Looking into the week of May 9, 2016, the IPO calendar has one deal expecting to raise about $75.6 million. But anything could happen on Monday morning, May 2, to shape the agenda for the second week of May.
Disclosure: Neither the author nor anyone else on the IPOScoop.com staff has a position in any stocks mentioned, nor do we trade or invest in IPOs. The author and IPOScoop.com staff do not issue advice, recommendations or opinion.