SF's Billion Dollar Biotech FibroGen, Inc. Sets Terms For $124 Million IPO

October 31, 2014

By Riley McDermid, BioSpace.com Breaking News Staff

San Francisco-based biotech FibroGen will raise $124 million for the largest biotech initial public offering in a decade, the anemia and fibrosis drugmaker said Friday.

FibroGen will offer 7.1 million shares at a price range of $16 to $19. At the midpoint of the proposed range, it would command a fully diluted market value of $1.1 billion. Even at 15 percent below the midpoint pricing, FibroGen would still be the third largest biotech IPO in 10 years, according to market data.

Goldman Sachs, Citi and Leerink Partners are joint bookrunners on the deal, which expected to price the week of Nov. 10, 2014, on NASDAQ under the symbol FGEN.

Primary shareholders include Chairman and CEO Thomas Neff, who is a founder, and Astellas Pharma. AstraZeneca will purchase $20 million worth of shares in a concurrent private placement.

The company’s lead candidate, anemia drug roxadustat, is in Phase III trials. It is an oral small molecule inhibitor of HIF prolyl hydroxylases that stimulates red blood cell production. It hopes to compete in the lucrative anemia market, which analysts have projected could see sales of over $12 billion is a safe, effective oral treatment is found.

FibroGen is also hoping to field a new idiopathic pulmonary fibrosis drug that is in Phase II trials. The monoclonal antibody is hoped to be a therapy for IPF, pancreatic cancer and liver fibrosis.

The company said it expects its CKD anemia program to be fully funded with potential non-contingent milestone payments of up to $900 million from Tokyo-based Astellas and $1.6 billion from AstraZeneca. It plans to launch roxadustat on the strength of that funding and the $121 million of revenue it had in the bank as of Sept. 30, 2014.