Bayer, Moderna-Backed Metagenomi’s Stock Crashes 31% in Friday IPO Debut

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Pictured: Nasdaq stock exchange headquarters in New York City/iStock, JHVEPhoto

Metagenomi shares dropped 31% on Friday afternoon in a disappointing debut on the Nasdaq Global Select Market, highlighting the potential perils faced by preclinical biotechs seeking to go public, according to Seeking Alpha.

The company’s stock opened at $10.25 per share, versus its initial public offering (IPO) price of $15 apiece. Shares of Metagenomi climbed to a high of $11.24 per share and dipped to a low of $9.80 on Friday.

Last week, Metagenomi unveiled its initial plans to go public in an $86.9 million IPO, with plans to sell more than six million shares of its common stock for $15 to $17 apiece. The California-based company made its Nasdaq debut days later in an IPO priced at the lowest end of its target range, with the expectation of raising nearly $93.8 million.

Though Metagenomi joins an impressive class of companies that have gone public this year, it also bucks the trend of IPOs that have raised more money than expected.

Leading the pack is CG Oncology, whose $380 million IPO last month was a huge jump from its initial target of $180 million. ArriVent followed soon after, with its own upsized $175 million offering, up from its expectation of $135 million to $156 million. Alto Neuroscience, which went public earlier this month, likewise saw a larger final haul of $128.6 million versus its initial estimate of $89 million to $103 million.

Kyverna Therapeutics is the latest biotech to upsize its IPO, bringing in $319 million in gross proceeds compared to its initial net earnings target of $182 million. Kyverna’s Nasdaq debut saw its stock surge nearly 60% following its IPO.

The market’s tepid response to Metagenomi could be because it currently has no clinical-stage candidates. Instead, the biotech is banking on what it calls “the most diverse genome editing toolbox,” which it plans to leverage to target a wide variety of genetic diseases.

According to its website, Metagenomi has developed a comprehensive set of tools—including base editors, programmable nucleases and RNA- and DNA-mediated integration systems—that it contends can address and target “essentially any codon in the human genome.”

The company’s metagenomics-focused approach to diseases has attracted several high-profile backers, including Moderna and Bayer, which contributed to the biotech’s $275 million Series B haul in January 2023.

Using its toolbox, Metagenomi has developed several preclinical- and discovery-stage assets targeting a variety of indications, including hemophilia A, familial amyotrophic lateral sclerosis, Duchenne muscular dystrophy and cystic fibrosis. It also has a primary hyperoxaluria type 1 program in partnership with Moderna, and a transthyretin amyloidosis candidate in collaboration with Ionis.

Tristan Manalac is an independent science writer based in Metro Manila, Philippines. Reach out to him on LinkedIn or email him at tristan@tristanmanalac.com or tristan.manalac@biospace.com.

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