Epizyme jumps 53% after IPO; Kamada rises 9.2%
This article was originally published in Scrip
Epizyme closed 53.3% higher than its $15 initial public offering price at the end of its first day of trading, stealing the spotlight from another US first-time offering on 31 May by the Israeli biopharma company Kamada.
Epizyme's closing price of $22.99 per share wowed biotechnology investors – even those impressed enough by the company's epigenetics platform to buy into the IPO, which priced at the top of an earlier $13 to $15 range (scripintelligence.com, 31 May 2013). But Kamada went to market with an offering priced at $9.25 and closed with a respectable 9.2% gain at $10.10.
Kamada said it would raise up to $69 million when the company, which specializes in plasma-derived protein therapeutics and trades on the Tel Aviv Stock Exchange, registered its US IPO in April (scripintelligence.com, 16 April 2013).
But after Kamada set a preliminary price of $10.75 per share in mid-May for gross proceeds of $60 million, the company ultimately grossed $51.6 million from an offering of 5.6 million shares at $9.25 each on 30 May (scripintelligence.com, 17 May 2013). The total raised could reach $59.4 million with the sale of 837,395 shares set aside for overallotments.
Still, Epizyme's and Kamada's gains at the close of their first day of trading in the US stock market illustrate the intense investor interest in the biotech sector.
Kamada's offering was the ninth life science IPO in May, representing the highest number of IPOs in one month for the biotech sector since August 2000 when 16 companies launched first-time offerings. The May total also outpaced the January-to-April total of eight companies that went public during the first four months of 2013, according to the biotech advisory firm Burrill & Co. And 17 more life science companies are in the queue for future IPOs.
Stock prices have increased 18.1% on average for biotech companies that completed first-time offerings this year as of 30 May with 13 companies trading above their IPO prices and four below, according to Burrill.