Back to School and Back to Business!
We’re all used to September being a very busy month, with many medical meetings and investor conferences jammed into the weeks immediately post-Labor Day – and this otherwise unusual year was no exception! We wanted to take a moment to “shout out” several Stern IR clients on a slew of remarkable recent achievements, which run the gamut from major clinical data readouts to product approvals, crossover rounds and IPOs to major M&A:
- ADC Therapeutics priced a follow-on offering, which raised gross proceeds of approximately $204 million
- Adicet Bio (new ticker ACET) completed its merger with resTORbio. The new combined company will focus on advancing a pipeline of allogeneic gamma delta T cell therapies for cancer and other diseases.
- Athira Pharmaceuticals (ATHA) closed its initial public offering, which raised gross proceeds of approximately $204 million.
- Blueprint Medicines announced FDA approval of GAVRETO™ (pralsetinib) for the treatment of adult patients with metastatic RET fusion+ NSCLC, EC approval of AYVAKIT® for the treatment of adult patients with unresectable or metastatic PDGFRA D842V mutant GIST and positive topline results from the EXPLORER and PATHFINDER clinical trials of avapritinib in advanced systemic mastocytosis, which support plans to submit an sNDA in the fourth quarter.
- Gilead Sciences announced a definitive agreement to acquire Immunomedics for $88 per share in cash (or approximately $21 billion).
- XWPharma announced the completion of a $40M Series C financing, led by Panacea Venture, with participation from existing investors, Johnson & Johnson Innovation – JJDC, Inc., WI Harper Group, WuXi AppTec’s Corporate Venture Fund and KTB Network, and new investors, CDIB Yida Healthcare Fund, Hontai Capital and Trinity Fund. XW also announced the appointment of Leonard Blum as President and CEO.
NASDAQ Responds to the SEC’s Proposed Amendments to the 13F Reporting Threshold
Over the summer, the SEC announced a proposal to increase the 13F disclosure threshold from $100M to $3.5B. As we wrote at the time, this proposal raised some pretty substantial questions and incited backlash from hundreds of companies who felt the SEC’s proposal put transparency at risk for both companies and investors.
Earlier this week, NASDAQ, with the support of 321 companies – including several Stern IR clients – submitted two filings to the SEC in response to their proposals. The first was a comment letter from NASDAQ’s Chief Legal and Regulatory Officer John Zecca, outlining how the increased 13F disclosure threshold would not only reduce transparency for public companies and their investors, but impede stockholder engagement and deny retail investors and issuers critical information needed to make their investment decisions. The second filing was a joint comment letter, showing support from hundreds of companies across 50 sectors and letter, showing support from hundreds of companies across 50 sectors and industries representing $3.3T in market cap, and including some (newly) household names, like Zoom Video. Importantly, NASDAQ and the 300+ signatories feel that the effects of the SEC’s proposal would be felt most significantly by small-cap companies: funds held by managers in the $100M-$3.5B range of report assets currently account for 30% of the total assets invested in these companies.
Of course, it’s too soon to say how this will all play out, but the impact is potentially significant, both for our ability to track company shareholders and target potential new ones. We’ll be keeping a close eye!
While the markets remain a bit shaky overall, we have seen a number of substantial financings close in recent weeks, as well as VC firms raising new funds, signaling continued excitement around, and interest in, biotech.
Last week, Longitude Capital closed its largest fund to date, raising $585 million. The fund will follow the firm’s existing strategy, investing in around 25 companies, with 2/3 allocated to biotech and 1/3 allocated to medtech.
Additionally, Medicxi closed Medicxi Secondary 1 (MS1) in connection with the completion of an “Exit & Reinvest” type of structured secondary transaction. The interests in six clinical and preclinical companies held by Index Ventures Life VI were acquired by the newly formed MS1. MS1 has committed to invest in each of the six companies the funding required to accelerate their clinical development through the next stages of value creation.
Looking at market performance last week, the NASDAQ, DJI, and S&P 500 lost 2%, 4% and 3% respectively as of Thursday EOD. The NBI, XBI and BTK also had a tougher week, closing Thursday down 4%, 6% and 3%, respectively. The VIX was up 7%. On the financing front:
- During the week of September 14-18, Humanigen uplisted to the NASDAQ ($68M), and we also saw 4 IPOs price, including SIR client Athira ($204M), COMPASS Pathways ($128M), Dyne Therapeutics ($268M), and Outset Medical ($278M).
- During the week of September 21-24, three follow-ons, including SIR client ADC Therapeutics ($204M), Protara Therapeutics ($148M) and Wave Life Sciences ($100M), and two IPOs, GoodRx Holdings ($1.1B) and Taysha Gene Therapies ($157M), priced.
- Additionally, over the last two weeks, over 15 private deals announced, including several deals over $80M: Finch Therapeutics ($90M, Series D), Lava Therapeutics ($83M, Series C), Neogene Therapeutics ($110M, Series A), Palleon Pharmaceuticals ($100M, Series B), Silverback Therapeutics ($85M, Series C), and Synthekin ($82M, Series A).