May 19, 2015
By Riley McDermid, BioSpace.com Breaking News Sr. Editor
Belgian company Celyad SA, formerly known as Cardio3 BioSciences, will take a run at the American public markets, saying in an F-1 filing with the U.S. Securities and Exchange Commission that it will raise $115 million for its IPO, as the market for CAR-T therapies continues to heat up.
The biotech develops gene therapies for cardiovascular diseases and cancer and has caught the eyes of investors looking to capitalize on the next big thing in CAR-T or immunotherapy.
Celyad said it would list on the NASDAQ under the ticker symbol CYAD but had not yet determined the number of shares to be offered. UBS Investment Bank and Piper Jaffray will act as joint bookrunners on the deal.
“Celyad currently expects to use the net proceeds from the global offering for the following purposes: advance the development of NKG2D CAR T-cell through Phase I clinical development as a treatment for AML (acute myeloid leukemia) and MM (multiple myeloma),” said the company in a statement, “[as well as] advance additional CAR T-cell therapy drug product candidates for the treatment of additional blood cancers and solid tumors; and support its growth globally by expanding general, administrative and operational functions in the headquarters in Belgium and in the United States.”
Celyad said it would use the rest of the net proceeds to in-license, acquire or invest in “complementary technologies, products or assets”.
Celyad is entering the market at an interesting time. Recent data from the Exit Poll report by Thomson Reuters and the National Venture Capital Association on April 6 shows that initial public offerings dropped 54 percent during the first quarter of 2015, with a 58 percent decrease in dollars invested in the 17 offerings, 13 of which were life sciences IPOs.
Overall, the 17 venture-backed IPOs raised $1.4 billion during the first quarter of 2015, with life sciences IPOs representing 76 percent of total listings in the first quarter.
“This quarter marked the first quarter to see less than 20 venture-backed IPOs since the first quarter of 2013,” said the report.
“For the first quarter of 2015, 86 venture-backed M&A deals were reported, 16 of which had an aggregate deal value of $2.1 billion. Venture-backed M&A activity during the quarter fell to its lowest levels, by number of deals and disclosed value, since the first quarter of 2013.”
It’s been a rocky ride on the capital markets as well, with the some exchange-traded funds, like iShares Nasdaq Biotechnology Index Fund losing as much as 2.23 percent during the past week alone. Those loses have trimmed a nearly three-fold gain in the NBI since 2012, and may be indicative of investor caution as venture capitalists sit on the sidelines and wait for volatility to die down.
“With such a blistering pace for venture-backed exit activity in 2014, it was only a matter of time before we saw a drop activity. Despite the decline in venture-backed IPOs for the quarter, a lot of promising young companies made their debut on the public markets with many more waiting in the wings,” said Bobby Franklin, president and chief executive of NVCA.
There were also a few notable pull-outs from companies that decided to wait until the market was at a higher point, a common tactic used by corporate boards to make sure their IPO gets the maximum amount of value possible. Among those were Koltan Pharmaceuticals and Israeli company PolyPid Ltd., which in a terse statement the Petach Tikva, Israel-based firm said it would withdraw its plans for the $20 million IPO, which had been priced at a range of $10 to $12 a share.
There had been rumors that a recent selloff in the biotech sector, which has dropped 7 percent the last week in march, and thus would have value the company at a lower amount, pushed PolyPid to pull its IPO. But Asaf Bar, chief business officer, told the Wall Street Journal other factors were in play.
“We were very confident with our ability to go public even with the market conditions,” he said. Bar added the company will wait for its pipeline milestones in the second half of 2015 before attempting another IPO.
Cheerleaders for the industry also remained sanguine about the near halving of the offerings on tap last quarter, saying that with investment happening at such a rapid and unprecedented clip in 2015, some pullback was inevitable—though likely not permanent.
“With 54 venture-backed companies having already filed publicly for IPOs and many more confidential registrations already in place, we are optimistic that the pace for venture-backed exits will pick up steam as the year moves ahead, creating opportunities for everyday investors to be shareholders of innovation,” said Franklin.
Will Mylan Buy Teva, As Predator Becomes Prey?
The complicated three-way takeover waltz being conducted between Pittsburgh, Penn.-based Mylan Inc., Israeli company Teva Pharmaceutical Industries Ltd. and Perrigo Company took another weird turn last week, after Mylan said that while it still views Teva’s unsolicited $40.1 billion bid as too low, it might want to acquire Teva itself eventually. Mylan Chairman Robert J. Coury made it clear that if Mylan is able to cement its deal with Perrigo, it might go shopping again—and this time to buy Teva, not be bought. With dealmaking heating up in 2015, we wanted to know your thoughts: Will perennial predator Teva wind up being prey?
