The Super Bowl, the Iowa caucus and another down week for the U.S. stock market dominated the news last week, but 2016’s IPO production line finally kicked into gear. Two out of an expected six IPOs got out the door.
The two IPOs that made their debuts last week were from the health-care sector. Each did well in the aftermarket. The reason? Mojo. Yes, each one was working its mojo.
BeiGene (BGNE), a clinical-stage biopharma company focused on developing molecularly targeted immuno-oncology drugs to treat lymphoma, melanoma, ovarian and other types of cancer, priced its IPO of 6.6 million American Depositary Shares (ADS) at $24 each on Tuesday evening. That was on the high end of its $22- to $24-a-share price range and the number of shares was increased to 6.6 million ADS, UP from 5.5 million ADS. The IPO opened at $28.97, closed its opening day at $28.32, and closed Friday at $33.91, UP 41.3 percent from its IPO price.
Its mojo: Insiders purchased about $63 million of the IPO, or about 39.8 percent of the deal. BeiGene also has a collaboration agreement with Merck KGaA that has already produced $33 million in revenue through 2016.
Editas Medicine (EDIT), a biotech company providing genome editing services, priced its IPO of 5.9 million shares at $16 each on Tuesday evening. That was on the low end of its $16- to $18-per-share price range. The IPO opened at $18, closed its opening day at $18.20, and ended Friday at $17.60, UP 10 percent from its IPO price.
Its mojo: Editas has a golden list of investors, reportedly including Bill Gates and Google Ventures, as well as T. Rowe Price and Fidelity, and venture capital firms such as Flagship Ventures, Polaris Partners, Third Rock Ventures and others. It has license agreements with the President and Fellows of Harvard College, the Massachusetts Institute of Technology and the General Hospital Corporation (Massachusetts General Hospital) and a collaboration agreement with Juno Therapeutics, in which Juno has agreed to pay Editas $25 million upfront and up to $22 million in research support over the next five years, according to the prospectus.
But that was last week. Now let’s move on to the future.
Four New Faces
By the time the sun comes up on Wall Street Monday morning, the Super Bowl will be history, the New Hampshire primary is on the horizon, the Chinese New Year will be in full swing, and this week’s IPO calendar pops up with eight names. These companies aim to raise nearly $1.4 billion, subject to market conditions.
Four of the eight deals are new faces at the IPO window. The others are carryovers from previous weeks. The newcomers to this week’s calendar are two health-care providers, an airport food and beverage company and a waste-disposal provider.
AveXis (AVXS – proposed) is a Bannockburn, Illinois-based clinical-stage gene therapy company developing novel treatments for patients with rare and life-threatening neurological genetic diseases. Its initial product candidate, AVXS-101, is a gene therapy product candidate currently in a Phase 1 clinical trial for the treatment of spinal muscular atrophy, the leading genetic cause of infant mortality.
The Buzz: (1) Insiders have indicated an interest in purchasing $30 million of the IPO, or about 35 percent of the deal. (2) AveXis has a collaboration agreement with Nationwide Children’s Hospital in Columbus, Ohio. Nationwide is a leading pediatric gene therapy research institute.
Bankers expect to price 4.25 million shares at $19 to $21 each on Wednesday evening to trade on the NASDAQ Global Market Thursday morning.
(For more information, please click here: AveXis)
Proteostasis Therapeutics (PTI – proposed) is a Cambridge, Massachusetts-based biopharmaceutical company developing novel therapeutics to treat diseases caused by an imbalance in the proteostasis network. On its website, the company says, “The Proteostasis Network consists of more than 1,000 proteins organized into pathways that can be regulated.” The company’s initial therapeutic focus is on cystic fibrosis, the most common fatal inherited disease in Caucasians; there is no cure.
The Buzz: (1) Insiders have indicated an interest in buying $30 million of the IPO, or about 60 percent of the deal. (2)The company has partnered with major pharmaceutical companies, including Biogen New Ventures and Astellas. Proteostasis Therapeutics’ existing corporate alliances with Biogen and Astellas provide for aggregate milestone payments of up to about $1.4 billion, according to its prospectus.
Bankers expect to price 3.85 million shares at $12 to $14 each on Wednesday evening to trade on the NASDAQ Global Market Thursday morning.
(For more information, please click here: Proteostasis Therapeutics)
OTG EXP is a New York City-based award-winning travel restaurateur with more than 200 restaurant and retail locations in 13 terminals in 10 airports across North America.
The Buzz: The Street has not heard much color on this deal. The company is considered a leader in its industrial sector and reportedly has attracted some investor interest.
Bankers expect to price 32.5 million shares at $16 to $18 each on Tuesday evening to trade on the NASDAQ Global Market Wednesday morning.
(For more information, please click here: OTG EXP)
Advanced Disposal Services (ADSW – proposed) is a Ponte Vedra, Florida- based integrated provider of non-hazardous solid waste collection, transfer, recycling and disposal services. The company operates in 18 states across the Midwest, the South and the East. It services about 2.8 million residential and 202,000 commercial and industrial customers through a network of 93 collection operations, 74 transfer stations, 22 owned or operated recycling facilities and 39 owned or operated landfills.
The Buzz: The Street has not heard much color on this deal. The company plans to sell about 9 million shares and insiders plan to sell about 12.4 million shares in the offering.
Bankers expect to price 12.4 million shares at $20 to $22 each on Wednesday evening to trade on the New York Stock Exchange Thursday morning.
(For more information, please click here: Advanced Disposal Services)
Looking into the week of Feb. 15, 2016, the IPO calendar has nothing. It is clean and green for now, but things have been known to change quickly.
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 opinions.