4 Biotech IPOs, and 2 Are Unicorns

A unicorn, in investor jargon, is a private startup company with a value greater than $1 billion. Two of this week’s biotech startup initial public offerings, BridgeBio and Adaptive Biotechnologies, have market values exceeding the magic $1 billion mark, and have recently launched initial public offerings (IPOs), but also increased their fundraising goals.

On June 17, BridgeBio set terms for its $240 million IPO. The company is based in Palo, Alto, Calif. and trades on the Nasdaq under the ticker symbol “BBIO.” BridgeBio focuses on genetic diseases. It was formed in 2015 and has a portfolio of more than 15 compounds. Each drug asset is housed in its own subsidiary company with access to centralized resources and capabilities built on a novel corporate structure. Some of the targeted indications include transthyretin amyloidosis (ATTR-CM and ATTR-PN), pantothenate kinase-associated neurodegeneration (PKAN), Gorlin syndrome and others.

BridgeBio originally planned the IPO for about $225, which increased a bit, but now it is looking to raise about $300 million, which would give the company a market value of about $1.8 billion. The original range for the pricing was $14 to $16 per share but has come in at $17. It began trading this morning.

Adaptive Biotechnologies has two commercial products and a clinical pipeline to “diagnose, monitor and enable the treatment of diseases such as cancer, autoimmune conditions and infectious diseases.” What the company actually does is provide genetic immunosequencing tests to diagnose and treat diseases.

The company originally filed to offer 12.5 million shares at a price ranging from $15 to $17 per share. Yesterday it increased the pricing from $18 to $19, which will raise about $278 million. The company will have a market value of about $2.5 billion.

Compared to 2018, which marked 507 IPOs totaling $72 billion, this year has been slower, down 27%. Tech companies have had 68 IPOs, and healthcare companies have had 56 IPOs. Of the healthcare companies, 25 have reportedly been biotech companies.

But this week’s biotech IPO stable isn’t limited to BridgeBio and Adaptive.

Morphic Therapeutics announced its IPO yesterday, planning to sell 6 million shares at $15 per share. It began trading today on the Nasdaq under the symbol MORF. The company is working to create a new generation of oral integrin drugs. In February, it signed a research-and-development collaboration with Janssen Biotech, a Johnson & Johnson company. They will focus on several undisclosed integrin targets.

Integrins are a family of receptors that appear on the surface of most cells in humans. They are made up of two submits, alpha and beta. Integrin signaling controls a broad variety of cellular processes, including cell survival, cell cycle progression, immune system activation, cell differentiation, and cell migration. The company’s disease focus is on fibrosis, autoimmune disease, and immuno-oncology.

Karuna Therapeutics filed for its IPO in April. The company had raised $122 million in two venture rounds, the second one in April for $80 million. The company is expecting data from a Phase II clinical trial later this year of KarXT xanomeline/trospium chloride, a muscarinic receptor modulator, to treat acute psychosis associated with schizophrenia. On June 17, it set its pricing between $15 and $17 per share to raise $74.4 million. It will trade on the Nasdaq under the ticker symbol KRTX.

In its latest filing, the company stated, “We intend to use the net proceeds from this offering, together with our existing cash, cash equivalents and short-term investments, to fund the completion of our ongoing Phase II clinical trial and the completion of a planned Phase III clinical trial for the treatment of psychosis in schizophrenia.”

It also plans to finish its Phase Ib trials in schizophrenia and a Phase Ib and Phase II trial for psychosis in Alzheimer’s disease, complete a planned Phase Ib trial and complete a Phase II trial for pain, and develop its pipeline.