The IPO Buzz: Biotechs on the Front Burner

Two biotech IPOs are set for pricing tonight. Apogee Therapeutics (APGE proposed) and Sagimet Biosciences (SGMT proposed) are on the marquee to price Thursday night (July 13, 2023). The two deals would raise a combined $325.1 million, if priced at the mid-point of their ranges. Together, they make the biotech sector’s first sizable showing on the IPO Calendar since Acelyrin (SLRN) raised $540 million in its upsized IPO in the first week of May. (For the record, cancer biotech Intensity Therapeutics (INTS) made its NASDAQ debut on June 30, 2023, in a small-cap IPO.)

IPO investors, who are hungry for deals that work, say that CNBC’s Jim Cramer created some buzz early this week when he said the worst of the IPO drought may be over.

U.S. stock futures are higher early today – pointing to a fresh 15-month high today – after Wednesday’s big rally on the cooler-than-expected inflation reading from the June Consumer Price Index. The S&P 500 set a new high for 2023, closing at 4,472.16. The NASDAQ gained 158.2 points, or 1.15 percent, to close at 13,918.96. Both the S&P 500 and the NASDAQ ended at their highest marks since April 2022, CNBC noted. The Dow Jones Industrial Average closed at 34,347.43 – up 86.01 points for the day after jumping over 300 points to a session high of 34,586.94 in the first half hour of Wednesday’s session.

“The market’s roaring. That’s going to help,” a seasoned IPO trader says.

Let’s take a look at these two biotech deals:

*Apogee Therapeutics (APGE proposed) Fidelity and OrbiMed are among the big names backing this clinical biotech, which is offering 15.63 million shares at $15.00 to $17.00 to raise $250.1 million, if priced at the $16.00 mid-point. The market cap would be $728.9 million, assuming a $16.00 IPO price.

Jefferies, TD Cowen, Stifel, Guggenheim Securities and Wedbush PacGrow are the joint book-runners.

Apogee Therapeutics is targeting inflammatory and immunological disorders with its two leading product candidates – monoclonal antibody treatments in clinical trials:

–   APG777 is targeting AD (atopic dermatitis), a chronic skin disease, and

–   APG808 is targeting COPD, also known as chronic obstructive pulmonary disorder, which can lead to emphysema and death.

 

*Sagimet Therapeutics (SGMT proposed) – VC giants Kleiner Perkins Caulfield & Byers and New Enterprise Associates own the two biggest stakes in this clinical biotech, through their investment vehicles. Sagimet Therapeutics is offering 4.69 million shares at $15.00 to $17.00 to raise $75.0 million, if priced at the $16.00 mid-point. The market cap would be $344.8 million, assuming a $16.00 IPO price.

Goldman Sachs, TD Cowen, Piper Sandler and JMP Securities are the joint book-runners.

Sagimet Biosciences lead product candidate, denifanstat, is a once-daily pill undergoing evaluation in a Phase 2b clinical trial to treat NASH, also known as nonalcoholic steatohepatitis, or fatty liver disease. NASH is a chronic and potentially fatal liver disease for which there is currently no approved treatment in the United States and Europe. Patients with NASH face an increased risk of developing cirrhosis of the liver or liver cancer, according to NASHFacts.

Sagimet Biosciences has a license partnership with Ascletis Bioscience Co. Ltd. to conduct clinical trials in China to evaluate its lead product candidate, denifanstat, in two other indications:

  • To treat moderate to severe acne, and

  • To treat recurrent glioblastoma multiforme (GBM), an aggressive type of brain cancer – in combination with an established cancer drug, a monoclonal antibody called bevacizumab.

Both Apogee Therapeutics and Sagimet Biosciences are typical biotechs when it comes to the bottom line. Each company has booked net losses while generating no revenue, according to their SEC filings.

These two biotech IPOs are set for pricing tonight after the U.S. stock market’s close.

Stay tuned.

(For more information about these companies, please check the IPO Calendar and the individual IPO Profiles found on IPOScoop.com’s website.)

Note: Never trade on proposed symbols. They have been known to change and you might buy something on the OTC Bulletin Board. 

To see what time the NASDAQ IPOs are expected to trade, please log in to: NASDAQTrader.com then scroll down to IPO Message. 

Disclosure: Nobody on the IPOScoop.com staff has a position in any stocks mentioned above, nor do they trade or invest in IPOs. The IPOScoop.com staff does not issue advice, recommendations or opinions.

Disclaimer: A SCOOP Rating (Wall Street Consensus of Opening-day Premiums) is a general consensus taken, at press time, from Wall Street and investment professionals concerning how well an IPO might perform when it starts trading. The SCOOP Rating does not reflect the opinions of anyone associated with IPOScoop.com. The SCOOP ratings should not be taken as investment advice. The rating merely reflects the opinion of the professionals at the time of publication and is subject to last-minute changes due to market conditions, changes in a specific offering and other factors, such as changes in the proposed offering terms and the shifting of investor interest in the IPO. The information offered is taken from sources we believe to be reliable, but we cannot guarantee the accuracy.