Rick Klausner's crew of T cell specialists wraps $425M IPO, hitting Nasdaq alongside Verve, Molecular Partners

17 Jun 2021
endpts.com
AntibodyCell TherapyImmunotherapyCollaborateIPO
It’s harvest day for a pair of biotech startups with lofty goals to break new ground in cancer and coronary heart disease — and their high-profile founders. Rick Klausner’s Lyell Immunopharma and Sek Kathiresan’s Verve Therapeutics have both priced their IPOs, raising $425 million and $266.7 million, respectively. Neither are in the clinic yet, but if their newly gained valuations are any indication, there is plenty of appetite for the kind of animal data and bold approaches they offer. Also rounding out the first half of the year is Molecular Partners, the Swiss company that’s raised $63.8 million for its secondary listing in the US based on an Amgen- and Novartis-partnered platform. As many as 70 biotech companies have filed or already priced an IPO so far in 2021, according to Endpoints News’ IPO tracker. Rick Klausner’s crew of T cell specialists hits Nasdaq with $425M raise Ex-NCI chief Klausner set out three years ago to build a top player in the field of cell therapy 2.0, recruiting some of the top experts and allying himself with GlaxoSmithKline’s Hal Barron along the way. The stated aim is nothing short of curing solid tumors. With two technology platforms to retool T cells — one to overcome loss of function due to exhaustion, and the other to create durable T cell populations — the biotech isn’t married to any particular approach. Although they are starting with a CAR-T against ROR-1 as the lead candidate, the pipeline spans TIL and TCR therapies. That big-picture approach to drug hunting attracted Bob Nelsen’s ARCH, as well as the Parker Institute for Cancer ImmunotherapyCancer Immunotherapy. GSK stands to gain as an investor on top of being a partner on two NYESO-directed TCR programs. Lyell is gunning for four IND submissions by the end of 2022. Out of the IPO proceeds, $260 million are reserved for the Phase I trials of the two in-house candidates, while the tech platform R&D and manufacturing teams will get $100 million each. The company priced its 25 million shares at $17, the midpoint of its range, giving it a $4.4 billion valuation according to Renaissance Capital. As a footnote you may remember that Lyell had penciled in a $150 million goal in its S-1 — another illustration that these figures are often placeholders these days. Eyeing one-and-done heart therapy, Sek Kathiresan grabs $266.7M on the way to the clinic CRISPR base editing isn’t exactly new, and neither is PCSK9 as a target for cardiovascular drugs. But Verve’s pitch to combine the two is clearly striking a nerve. The Boston-based biotech went above its range by pricing at $19, with 14,035,789 shares on offer in its Nasdaq debut. Sek Kathiresan The idea behind Verve stems from Sek Kathiresan’s years of research on the genetics of cardiovascular disease. If the fundamental cause is cumulative exposure to lipids, the thinking goes, can’t you do something to try to prevent that — especially when scientists have uncovered genetic mutations that seem protective against coronary heart disease? It helped that tools also became available to make a one-and-done therapy possible. Verve licensed its base editors from Beam Therapeutics; the first program involves changing a single letter in the PCSK9 gene, thereby inactivating it. With promising monkey data in hand, Verve’s plan is to submit an IND in 2022. After testing the approach in a small group of patients with a rare condition that puts them at the highest risk, Kathiresan expects to eventually extend the reach to a mass market. Behind it comes a base editor that targets ANGPTL3, which will claim the chunk of the IPO proceeds, and there’s a set of other genes Verve reckons will be relevant here. GV is a big believer, retaining 24.6% of shares after the offering. Other investors include ARCH Venture, Biomatics Capital, Casdin Capital and Wellington, while Kathiresan keeps 1.8% for himself. Undeterred by CRL, investors buy into Swiss biotech’s tech with modest IPO Molecular Partners is all about DARPins, a novel class of molecules that it says can perform the same functions as antibodies but are just a tenth of the size and designed to be more specific. Most recently, the technology has been applied to create a “trispecific” antiviral against Covid-19, a drug it’s teamed up with Novartis on. Dubbed ensovibep, it’s also part of the NIH’s master protocol for hospitalized mild-to-moderate patients. The infectious disease branch is a new focus relative to oncology and ophthalmology, where Molecular Partners’ technology has inspired discovery pacts with both Amgen and AbbVie. But it’s not all been smooth sailing. The eye drug it is developing with AbbVie (via Allergan) was rejected by the FDA last year, as regulators took issue with “the rate of intraocular inflammation” observed after administration of the anti-VEGF injection and the risk that entails. It’s still unclear what will happen to the molecule, abicipar, which has been tested for both wet age-related macular degeneration and diabetic macular edema. For the IPO, though, the company focused on the bright side, with plans to take a FAP/CD40 bispecific through Phase I, expanding infectious disease R&D, and doing more with the CD3 platform. It sold 3 million shares at $21.25 each, similar to what it was trading at on the Swiss exchange — where it’s been listed since 2014.
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