Talk about a healthy start. Prime Medicine, Inc. (PRME) started NASDAQ trading shortly after noon EDT today at $18.97 – up $1.97 or 11.6 percent from its $17.00 IPO price. The first trade occurred at 12:11 p.m. EDT on volume of 532,337 shares, NASDAQ records show. By early afternoon, though, the stock gave up its early gain and dipped below its IPO price to trade at around $16.18 with a little more than a hour to go before the closing bell. Prime Medicine, Inc. (PRME) priced its upsized IPO on Wednesday night (Oct. 19, 2022) at $17.00 – the mid-point of its $16.00-to-$18.00 range – on 10.29 million shares (10,294,118 shares) – up from 8.9 million shares in the prospectus. The preclinical gene editing company raised $175 million – $23.7 million more than its estimated IPO proceeds of $151.3 million – by adding about 1.39 million shares.
Shares of Prime Medicine ended their first day of trading on Thursday (Oct. 20, 2022) at $15.37, down 9.59 percent, to go down in the books as a broken deal.
Prime Medicine’s twists and turns in its debut occurred against the backdrop of the overall U.S. stock market’s volatility. The three major U.S. stock indexes opened sharply higher – with the Dow up 278 points and the Nasdaq up 116 points at around 10:45 a.m. EDT on Thursday – as investors considered the outlook for interest rates, earnings and political turmoil in the U.K. after Liz Truss resigned as prime minister. By afternoon, the thrill was gone. The major U.S. stock indexes slipped into the red and ended the day lower.
J.P. Morgan, Goldman Sachs, Morgan Stanley and Jefferies were the joint book-runners.
Prime Medicine’s IPO is the first traditional IPO – and the first deal over $100 million – priced in the fourth quarter. Next week, Mobileye Global (MBLY proposed), Intel’s self-driving car unit, is on the marquee with its $779 million IPO – one of the most highly anticipated deals of the year.
The increase in the IPO’s size and the mid-point pricing gave Prime Medicine a valuation of $1.63 billion ($1,627.33 million), compared with the estimate of $1.6 billion ($1,603.7 million) under the terms in the prospectus.
A “Word Processor” to Fix Broken Genes
Prime Medicine, based in Cambridge, Massachusetts, says its patented Prime Editing technology works like a “word processor” with a search-and-replace function to find and fix genetic defects that cause disease – all without causing any breaks in double-stranded DNA, according to the prospectus.
Prime Medicine has a collaboration with Beam Therapeutics. It also has a U.S. patent issued on Sept. 20, 2022, covering methods of using Prime Editors.
David Liu, Ph.D., a Harvard professor described by Endpoints News as a pioneer in the field of gene editing, and Andrew Anzalone, M.D., Ph.D., are the co-founders of Prime Medicine. Dr. Anzalone conceived of and developed Prime Editing technology, according to the prospectus.
Dr. Liu is Prime Medicine’s biggest shareholder with a stake of almost 25 percent.
GV, the venture capital arm of Google’s parent, Alphabet, is Prime Medicine’s biggest institutional investor with a stake of 14.6 percent. Other major institutional shareholders include Arch Venture Partners, F-Prime Capital Partners and Newpath Partners, the prospectus says.
Prime Medicine’s initial focus will be diseases of the blood, including sickle cell disease, a genetic hemoglobin disorder that affects mainly African Americans, and diseases of the liver, the eye and the ear, the prospectus says. Prime Medicine’s portfolio consists of 18 therapeutic programs, including ALS (Lou Gehrig’s disease), Fragile X syndrome, Duchenne muscular dystrophy and cystic fibrosis.
In the prospectus, Prime Medicine says: “Gene editing, including platforms such as Prime Editing, is a novel technology that is not yet clinically validated for human therapeutic use.
“We believe our in-licensed and company-owned Prime Editing technology has transformative potential that could change the course of how disease is treated and overcome the challenges associated with current genetic therapies.”
Prime Medicine’s initial focus will be diseases of the blood, including sickle cell disease, a genetic hemoglobin disorder that affects mainly African Americans, and diseases of the liver, the eye and the ear, the prospectus says. Prime Medicine’s portfolio consists of 18 therapeutic programs, including ALS (Lou Gehrig’s disease), Fragile X syndrome, Duchenne muscular dystrophy and cystic fibrosis.
The company, which is not profitable, had 158 employees as of Sept. 30, 2022.
Prime Medicine reported a net loss of $132.51 million on no revenue for the last 12 months, according to the prospectus.
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