Finance Watch: SpringWorks, Satsuma Launch IPOs; BioNTech Filing Shows US-China Trade War Impact

BioNTech has plenty of cash and is gearing up for an IPO, but money from a Hong Kong investor is in limbo. Plus, Satsuma and SpringWorks bring US IPO total to 34 this year, Fate's FOPO raises $150.5m and Pharvaris brings in $66m.

There are a lot of notable financial disclosures in BioNTech AG's US Securities and Exchange Commission (SEC) filing indicating that the company may raise up to $100m in a future initial public offering, including the fact that the four-year-old German firm has raised $1.3bn to date from seed and venture capital financings and fees from its big pharma partners.

But one particularly eye-catching footnote in the F-1 statement filed on 9 September is that Mainz-based BioNTech has yet to collect €87.7m ($96.5m) from a Hong Kong-based investor who participated in the multi-platform company's $325m series B venture capital round in July. The series B came just a year and a half behind BioNTech's $270m series A round.

The Hong Kong-based investor in the series B agreed to pay for 5.5m BioNTech shares by 23 August, but ongoing talks have revealed that "the payment may have been delayed, in part, due to ongoing geopolitical disruptions in Hong Kong and the ongoing trade dispute between the US and China," the company said in its F-1 statement. Despite the investor's continued interest in BioNTech, it is possible that the payment may be indefinitely delayed or may not come at all, the drug developer conceded.

Political unrest in Hong Kong and the US-China trade war already have hurt stocks that trade in the US market, hitting biotechnology stocks particularly hard. (Also see "Finance Watch: A Rough Week To End A Bad Month For Biotech Stocks" - Scrip, 9 Aug, 2019.) The fact that these issues are making it more difficult for Chinese investors to participate in biopharmaceutical financings compounds the uncertainty that's been lingering since the US stepped up its scrutiny of Chinese investments in US companies via the Committee on Foreign Investment to the United States (CFIUS). (Also see "Trade War Spreads: Trump Rains On China Biotech Investment Parade" - Pink Sheet, 14 Aug, 2018.)

But for BioNTech, with two large VC rounds mostly in its pocket and collaborations with seven different biopharma partners, the company appears to have plenty of cash to fund its mostly cancer-focused research and development pipeline without going public in the US.

BioNTech was founded in 2008 with an initial focus on individualized cancer therapies. The company's pipeline includes messenger RNA (mRNA)-based therapeutics, engineered cell therapies, monoclonal and bispecific antibodies, and small molecule immunomodulators for cancer and other diseases. It has more than 20 product candidates, including eight that are being tested in nine different clinical trials.

The vast majority of BioNTech's pipeline is in cancer, but the company is developing mRNA-based vaccines – including an influenza program – in partnership with Pfizer Inc. (Also see "Interview: BioNTech And Pfizer Explore mRNA Flu Vaccines In $120m+ Deal" - Scrip, 16 Aug, 2018.) It is also working on mRNA-based protein-replacement therapies for rare diseases under an agreement with Genevant Sciences Ltd.. (Also see "BioNTech Signs Rare Disease Co-Development Deal With Genevant & Licenses LNP Platform" - Scrip, 10 Jul, 2018.)

Among its mRNA-based oncology programs, BioNTech has the cancer vaccines BNT111, BNT113 and BNT114 in Phase I trials for advanced melanoma (adjuvant and metastatic), HPV-positive head and neck cancer, and triple-negative breast cancer, respectively. The company also has the individualized neoantigen-specific immunotherapy BNT122 in Phase I for solid tumors and Phase II for first-line melanoma.

The Bill & Melinda Gates Foundation recently committed up to $100m in funding to BioNTech under an infectious disease partnership focused on HIV and tuberculosis, including an initial $55m in equity and future investments. The company said in its F-1 statement that the foundation has committed to buying stock in its IPO. (Also see "BioNTech Gets Gates Foundation Funding For HIV, TB Drug Discovery " - Scrip, 5 Sep, 2019.)

US Filings Pile Up As New IPOs Launch

The summer drought for IPOs by biopharma companies that started in mid-July ended with a $70m offering by Canada's Bellus Health Inc. on 5 September and was followed by first-time offerings from Satsuma Pharmaceuticals Inc. and SpringWorks Therapeutics Inc. on 12 September. By Scrip's count, 34 drug developers have gone public in the US so far in 2019.

Satsuma planned to raise up to $80m from the sale of $5m shares at $14 to $16 to fund development of its late-stage migraine therapy, but went to market with 5.5m shares at $15 each to gross $82.5m before the sale of additional shares to meet overallotments.

SpringWorks previously said it could gross as much as $132m for its Pfizer-originated programs in cancer and rare diseases, then revised its proposed pricing on 12 September for the potential sale of 9m shares at $16 to $18 each. The offering went to market at the top of the price range, giving SpringsWorks $162m in gross proceeds before overallotments from the sale of 9m shares at $18 each.

Next line is Wilmette, IL-based Monopar Therapeutics LLC, which took its potential IPO to the next step in a 10 September SEC filing, proposing the sale of 4.44m shares at $8 to $10 each to gross up to $44.4m to fund its oncology R&D pipeline. (Also see "Finance Watch: Five More Biopharmas Enter US Queue Even As IPO Returns Dip" - Scrip, 23 Aug, 2019.)

Three additional biopharma companies filed paperwork with the SEC to initiate IPOs and one withdrew its IPO plans on 6 September. Among the updates:

• ADC Therapeutics SARL, another European company that recently brought in a big VC round, said it wants to raise up to $150m in a US offering. The Lausanne, Switzerland-based developer of antibody-drug conjugates (ADCs) wants to advance multiple ADCs for cancer through early- to mid-stage studies and its lead candidate ADCT-402 toward commercialization. ADC Therapeutics raised a $200m series E round in 2017 that it increased by $76m in June. (Also see "ADC Therapeutics Raises $76m To Keep ADC Development Momentum Going" - Scrip, 12 Jun, 2019.) Another $103m was added to the round in July. (Also see "Finance Watch: Among Multiple Mega-Rounds, Revolution Raises $100m For RAS Programs" - Scrip, 12 Jul, 2019.)

• The US and European firm Aprea Therapeutics wants to raise up to $86.25m in an IPO to fund its development of anti-cancer therapies targeting the p53 tumor-suppressor protein. The company, which operates from Boston as well as Stockholm, raised a €50m ($56.8m) series C round late last year and added another €5m to the round in February. (Also see "Finance Watch: Alternative Funding Sources Crucial Even Amidst A Biopharma VC Boom" - Scrip, 17 Dec, 2018.)

• Woburn, MA-based Frequency Therapeutics Inc. is seeking as much as $100m in a future IPO after receiving an $80m upfront fee from Astellas Pharma Inc. in July under an agreement for ex-US rights to Frequency's hearing loss candidate FX-322. At the time, the company said it had raised $87m to date in venture capital and other financings. (Also see "Astellas Adds To Regenerative Medicine Portfolio In Hearing Loss Deal With Frequency" - Scrip, 17 Jul, 2019.) Frequency will use the IPO proceeds to fund ongoing clinical development of FX-322 and to take additional programs from its Progenitor Cell Activation platform into clinical development, including a multiple sclerosis candidate.

• The Roivant Sciences Inc. subsidiary Dermavant Sciences Ltd. made its initial IPO filing in May, but postponed its $124m offering in June before withdrawing its IPO plans completely. (Also see "Finance Watch: Investors Bet On Hope As Four Early-Stage Companies Launch US IPOs" - Scrip, 21 Jun, 2019.) The company's lead drug candidate tapinarof, licensed from GlaxoSmithKline PLC, is in Phase III for psoriasis and atopic dermatitis. Dermavant raised $100m last year under a funding deal with NovaQuest Capital Management that is tied to tapinarof development milestones. (Also see "Finance Watch: Three New Funds, Including Former Amgen R&D Head Harper's Next Venture" - Scrip, 7 Sep, 2018.) Dermavant was not specifically named as a company that Roivant is selling to Sumitomo Dainippon Pharma Co. Ltd. under a $3bn deal announced on 6 September. (Also see "$3bn Roivant Deal To Fill Holes At Dainippon" - Scrip, 6 Sep, 2019.)

Few Public Company Financings, But VC Deals Flow

Significant financings by already-public biopharma companies have been relatively few and far between lately, but venture capital continues to flow into the industry.

The gene therapy developer uniQure NV is a notable exception to the general follow-on public offering (FOPO) slowdown. The Lexington, MA- and Amsterdam-based company priced an offering of 4.89m shares at $46 each to gross $225m before the sale of additional shares to meet overallotments. UniQure's lead program is the potentially first-to-market hemophilia B gene therapy etranacogene dezaparvovec (AMT-601), which has moved into Phase III testing. (Also see "UniQure Has High HOPE For Hemophilia B Gene Therapy " - Scrip, 11 Feb, 2019.)

In other recent financings:

• Fate Therapeutics Inc. in San Diego grossed $150.5m on 11 September from the sale of 8.6m shares at $17.50 each to fund clinical and preclinical trials, manufacturing and other expenses. Immuno-oncology (IO) candidates from Fate's proprietary induced pluripotent stem cell (iPSC) product platform include natural killer (NK) cell and T-cell immunotherapies. The company also is developing immuno-regulatory product candidates, including ProTmune, a pharmacologically modulated donor cell graft that is in Phase II for the prevention of graft-versus-host disease, and a myeloid-derived suppressor cell immunotherapy for immune tolerance in patients with immune disorders. Fate raised $125m in a September 2018 FOPO. (Also see "Finance Watch: Lilly Completes Elanco Animal Health Spin-Out As New IPO Filings Keep Rising" - Scrip, 21 Sep, 2018.)

• Chicago-based Xeris Pharmaceuticals Inc. garnered access to additional cash under an amended and restated loan agreement with Oxford Finance LLC and Silicon Valley Bank (SVB), which will help the company launch its newly approved glucagon product Gvoke for hypoglycemia and advance its pipeline of ready-to-use injectable and infusible drug formulations. The company said on 10 September that it now may borrow up to $85m versus $45m under its prior agreement with Oxford and SVB, and the maturity date has been extended to June 2024. The cash is available to Xeris under a first tranche totaling $60m with future drawdowns of $15m and $10m through mid-2021.

• Pharvaris BV in Leiden, Netherlands, said on 10 September that it closed a $66m series B round to fund development of oral B2 receptor antagonists for the treatment of hereditary angioedema. Foresite Capital led the round with participation from Bain Capital Life Sciences, venBio Partners and Venrock Partners along with prior investors LSP, Kurma Partners and Idinvest Partners. Pharvaris also announced that it initiated a Phase I trial in healthy volunteers for its lead drug candidate PHA121. The VC firm Kurma co-created the company. (Also see "Patience Is A Virtue For French VC Kurma " - Scrip, 20 Dec, 2018.)

• Paris-based Inotrem SA revealed on 12 September that it closed a €39m ($43.2m) series B round led by Morningside Ventures and joined by Invus with participation from prior investors Andera Partners, Sofinnova Partners and BiomedInvest. The company is developing immunotherapies that target the TREM-1 pathway in inflammatory syndromes. Inotrem will use the series B proceeds to fund the Phase IIb ASTONISH trial for lead drug candidate nangibotide, an anti-TREM-1 peptide, in septic shock and to test its companion diagnostic for identifying patients more likely to respond to the drug. The company also will expand its TREM-1 franchise into chronic inflammatory diseases. Inotrem raised an €18m series A round in 2014. (Also see "Inotrem raises Europe's biggest Series A this year" - Scrip, 17 Mar, 2014.)

• The Swiss firm Anokion SA, which is focused on restoring normal immune tolerance in the treatment of autoimmune diseases, announced on 11 September that it acquired Kanyos Bio Inc. and closed a $40m series B venture capital round backed by Versant Ventures, Novartis Venture Fund, Novo Ventures and certain private investors in Switzerland. Celgene Corp., Anokion's partner under a 2016 deal, also participated in the series B. Anokion said it has raised $160m to date from investors and partners, which includes the $45m Celgene paid up front to work with the company on immune-modulating therapies for autoimmune diseases. Lausanne-based Anokion will use the series B proceeds to take two antigen-specific drug candidates into the clinic during the next 12 months: ANK-780 for multiple sclerosis and the Kanyos asset KAN-101 for celiac disease. Anokion co-founded Kanyos, which developed KAN-101 using Anokion's technology platform, in 2015 with Astellas under a deal that gave the Japanese pharma an option to buy Kanyos. (Also see "Astellas invests in new company focused on diabetes and celiac disease" - Scrip, 2 Jun, 2015.)

• Hong Kong-based Insilico Medicine, which is using artificial intelligence for drug discovery, revealed on 9 September that it completed a $37m series B round led by Qiming Venture Partners. Eight Roads, F-Prime Capital, Lilly Asia Ventures, Sinovation Ventures, Baidu Ventures, Pavilion Capital, BOLD Capital Partners; other investors also participated. The company will use the proceeds to commercialize its generative chemistry and target-identification technology, build up a management team with pharmaceutical industry experience, and advance its drug development efforts – in cancer, fibrosis, non-alcoholic steatohepatitis (NASH), immunology and central nervous system (CNS) diseases – with the intention of seeking partners for specific programs. Insilico is a subsidiary of Juvenescence Ltd. and a co-founder of Napa Therapeutics Ltd. (Also see "Finance Watch: Vaccinex, Aridis Launch August's First US IPOs As The Summer Simmer Slows" - Scrip, 15 Aug, 2018.)

• Trucode Gene Repair Inc. launched in San Francisco on 10 September with $34m in initial funding from Kleiner Perkins and GV (formerly Google Ventures) to develop in vivo gene-editing technology designed to correct mutations that cause sickle cell disease, cystic fibrosis and other genetic disorders. The company's triplex gene-editing technology uses proprietary synthetic peptide nucleic acid (PNA) oligomers and DNA-correction sequences to edit mutations via natural DNA-repair mechanisms. The platform is designed to avoid double-stranded breaks seen with CRISPR and other nuclease-based editing technologies, and these novel therapeutics may be delivered intravenously without viral vectors. Trucode licensed the intellectual property underlying its platform from Yale University and Carnegie Mellon University.

• Cambridge, MA-based Platelet BioGenesis Inc. (PBG) has raised $45m to date from a new $26m series A-1 round, a prior series A financing and grant funding, the company said on 9 September. New investor Ziff Capital Partners and prior backer Qiming Venture Partners USA co-led the series A-1 round with participation from existing investors Nest.Bio Ventures, eCoast Angels and others. PBG is developing stem cell-derived, on-demand human platelets and platelet-based therapeutics. The company said it will double in size to 50 employees in 2020 as it builds its donor-independent platelet-manufacturing capabilities and conducts proof-of-concept studies around platelet-based therapeutics.

• Genenta Sciences in Milan and New York revealed on 11 September that the company closed its third round of funding totaling €13.2m ($14.5m), bringing its funding to date to €30.2m to finance its development of hematopoietic stem cell gene therapies for cancer. Genenta's Temferon technology is being tested in two Phase I/II clinical trials in early relapse multiple myeloma and newly diagnosed glioblastoma multiforme. The recent financing was led by Qianzhan Investment Management and Fidim, which is the holding company for the Rovati family, the former owners of Meda AB-acquired Rottapharm SPA (Mylan NV bought Meda in 2016). (Also see "Meda in €2.3bn Rottapharm acquisition" - Scrip, 31 Jul, 2014.) Another investor in Genenta's current financing, the Bormioli family, was an early investor in Advanced Accelerator Applications SA, which was acquired by Novartis AG for $3.9bn in 2017. (Also see "Confirming Rumors, Novartis Buys AAA To Boost Oncology Business" - Scrip, 30 Oct, 2017.)

Editor's Note: Finance Watch was updated on 12 September to note the launch of IPOs by SpringWorks and Satsuma.