Backed By a Genentech Alum, NGM Looks Like it Could be the Next Biotech IPO

Backed By a Genentech (RHHBY) Alum, NGM Looks Like it Could be the Next Biotech IPO
March 3, 2015
By Alex Keown, Breaking News Staff

SAN FRANCISCO – With two new leadership appointments announced this week, NGM Biopharmaceuticals, Inc. could be signaling a stock IPO, the San Francisco Business Times reported Tuesday.

NGM Biopharmaceuticals announced that Jeff Jonker has been named president and David Woodhouse, has been tapped by the company as chief financial officer. Before coming to NGM, Jonker was a senior vice president for corporate and business development at Theravance Biopharma and Theravance, Inc. Prior to that he served as the chief business officer of Satori Pharmaceuticals and a vice president for Gloucester Pharmaceuticals.

Prior to his role at NGM, Woodhouse was managing director and co-head of U.S. biotechnology investment banking at Goldman Sachs. The board of directors will continue to be headed by Dave Goeddel, the first scientist hired at Genentech and also includes former Genentech CEO Art Levinson.

When announcing the new additions, NGM CEO Bill Rieflin said the expertise in finances both men bring to the company will allow the company to “maximize shareholder value.” Although no plans have been announced to take the currently private company public, the San Francisco Business Times speculated the addition of Jonker and Woodhouse, plus current leadership on the board, could signal a future move to take the company public after an email exchange with Rieflin, who told the Business Times the new hires provided NGM with “greater operational flexibility.”

The additions of Jonker and Woodhouse are part of the company’s plan to expand its research and development opportunities, particularly those associated with the company’s new partnership with Merck & Co. , Rieflin said in a press release.

Last month NGM and Merck & Co. Inc. entered into a five-year collaboration to develop drugs that treat diabetes and obesity. The collaboration, which could be worth more than $450 million when factoring in possible new drug development, includes NGM drug candidates that are in preclinical development.

NGM Biopharmaceuticals primary drug is NGM-282, a medication for the treatment of primary biliary cirrhosis, or PBC, a liver disease.

PBC is an autoimmune disease of the liver characterized by the progressive destruction of the bile ducts and accumulation of bile in the liver. Over time, the excess bile damages the liver, resulting in the release of liver enzymes and bile acids into circulation and, eventually, to liver failure. According to the Mayo Clinic, researchers think it is triggered by a combination of genetic and environmental factors.

The Phase I dose trial conducted by NGM demonstrated that, at very low doses, NGM-282 is “able to dramatically reduce a highly specific biomarker for bile acid synthesis in the liver,” according to the company’s website. The drug is in Phase II of clinical trials, with results expected to be released soon.

NGM Biopharmaceuticals received both orphan drug and fast track designations from the U.S. Food and Drug Administration (FDA) for NGM-282 for the treatment of PBC.

Additionally NGM Biopharmaceuticals has found that NGM-282 has applications in the treatment of type 2 Diabetes, which would fall in line with the company’s new partnership with Merck. Researchers have noted the medication lowers blood glucose, insulin and lipids in multiple rodent models. Additionally researchers noted NGM-282 reduced body weight and increased metabolic rate in obese mice treated with the drug, supporting the potential for NGM-282 to be developed for obesity as well.

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Last week controversy erupted over the compensation package for Sanofi’s new CEO, Olivier Brandicourt, with several French government officials decrying the amount, calling it "incomprehensible." Brandicourt could walk off with as much as $4.5 million in a “golden handshake” payment in addition to making $4.76 million a year. That base figure is comprised by a fixed annual salary of $1.36 million a year, which is supplemented by a performance-related bonus of between 150 to 250 percent, as well as stock options and performance shares.

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