2024 Brings Surprising Early Surge of Biotech IPOs

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Pictured: Wall Street street sign in front of American flags/iStock, hapabapa

As we all know, 2023 was a horrible year for initial public offerings in biotech. However, the IPO market seems to have come alive in early 2024 with five companies jumping into the fray—Alto Neuroscience, ArriVent Biopharma, CG Oncology, Kyverna Therapeutics and Metagenomi. Bladder cancer–focused CG Oncology said in an SEC filing on Thursday that net proceeds from its offering will be $181.1 million, or up to $209 million if the underwriters exercise their over-allotment option in full. 

IPOs are the lifeblood of the industry, providing companies with critical capital to further develop their technologies and therapies. The apparent rush of public offerings, at least compared to last year’s lull, has been a nice surprise just two weeks into the new year—though, to their credit, analysts at PwC last month predicted a potential rebound in IPO volumes starting in 2024.

The professional services firm did warn, however, that “the recent lack of activity in the IPO markets has limited the ability of innovative startups to raise the necessary capital to advance their programs through the clinical stage,” while noting that companies that did go public were likely to be those with “strong clinical data.” Although some of last year’s IPOs fared well, we’ll have to wait and see if this year’s early crop ends up trading below their offering prices due to poor market conditions.

This week, we also got a regulatory surprise. Vertex Pharmaceuticals and CRISPR Therapeutics secured another FDA approval for their CRISPR/Cas9 gene-edited therapy Casgevy, this time for treating transfusion-dependent beta thalassemia (TDT). The decision came more than two months ahead of Casgevy’s PDUFA date—and only a month after Casgevy became the first CRISPR-based gene-editing therapy to be approved in the U.S., for sickle cell disease (SCD).

With a list price of $2.2 million, Casgevy is an expensive one-time, ex vivo treatment for eligible patients with SCD or TDT. However, the Gates Foundation and a dozen biotech companies are betting that gene therapies can be deployed at scale by treating cells in vivo, which they contend could be far less costly than ex vivo.  

BioSpace was on the ground in San Francisco last week for the J.P. Morgan Healthcare Conference and the associated JPM Week activities, where the costs of these therapies was a hot topic. At the Biotech Showcase, Alliance for Regenerative Medicine CEO Tim Hunt made the case that despite their multimillion-dollar price tags, gene therapies can save the U.S. healthcare system money.

“I know there’s sticker shock when you price the product at $2 million to $3 million. But if you look at the data, it tells a very compelling story,” Hunt said, noting that the lifetime cost of the standard of care for most rare diseases is more expensive than those of approved gene therapies. Vertex and CRISPR Therapeutics estimate that lifetime U.S. healthcare costs to manage TDT are more than $5 million.

This week, BioSpace provided a recap of seven significant deals announced during JPM Week, which included AI/drug discovery, antibody-drug conjugates, asthma and cardiovascular and gastrointestinal conditions. Being in San Francisco last week was a reminder of the technological power of the biotechs that form the hub known as Biotech Bay, where we had the chance to talk with some innovative companies in the area.

In case you’ve never seen BioSpace’s exclusive Hotbeds Maps, they showcase nine biotech regions across the country. We launched Biotech Bay, our first Hotbed Map, in 1989, and soon followed it with maps for Genetown (Boston area) and Biotech Beach (southern California), among others.

This week, we provide a retrospective on what’s changed in the 35 years since that first launch. Marc Goldberg, a MassBio co-founder, and Biocom leader Joe Panetta reminisce about their experiences helping to build these regional hubs. Check it out as we go Back to the Future!

Greg Slabodkin is the News Editor at BioSpace. You can reach him at greg.slabodkin@biospace.com. Follow him on LinkedIn. 

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