Urovant Sciences Ltd., an Irvine-based clinical-stage biopharma company that started operations in 2016, raised nearly $140 million in its initial public offering last week.
It’s the biggest offering of any Orange County-based company to go pubic via a traditional IPO this year.
Wall Street is taking a skeptical view of the upstart company’s prospects, based on early returns.
Urovant priced the 10 million share offering at $14 each, on the low end of its expected $14 to $16 per share range.
Its stock, which trades on the Nasdaq under the UROV ticker, came out of the gates even lower, trading around $11 per share last Thursday, its first full day of trading.
Shares were hovering around $11.50 by the time the Business Journal went to press on Friday, giving Urovant a market capitalization of about $345 million.
The offering was underwritten by J.P. Morgan, Jefferies Financial Group Inc. and Cowen Inc. Urovant will use the proceeds to fund clinical trials for its licensed products; working capital and general corporate purposes.
Urologic Drugs
Urovant plans to develop and commercialize drugs for urologic conditions, in particular the treatment of overactive bladder, a medical condition characterized by a sudden urge to urinate that’s difficult to control.
The company’s one of 12 “vants” falling under the umbrella of biotech entrepreneur Vivek Ramaswamy’s Roivant Sciences Ltd., a Basel, Switzerland-based firm that aims to take advantage of abandoned or deprioritized drugs that aren’t priorities in the pipelines of large pharma companies. Roivant was the sole shareholder of Urovant prior to the IPO, and now owns about 67% of the company’s stock.
Urovant is headed by Chief Executive Keith Katkin, who joined the company a year ago. He previously served as president and chief executive of Aliso Viejo-based Avanir Pharmaceuticals Inc., and led the nervous system disorder-focused drug development company through its $3.5 billion sale to Japan-based Otsuka Pharmaceutical Co. in 2015.
As is typical for many clinical-stage biopharm firms that are yet to see sales, the company’s run up a substantial amount of losses since its founding, with a $95.5 million accumulated deficit.
It said in regulatory filings that it expects “to continue to incur substantial and increasing losses through the commercialization of our product candidates.”
Urovant’s the third company based in OC to go public via an IPO this year; the other two are also in the healthcare sector and based in Irvine.
Drug developer Evolus Inc. (NASDAQ: EOLS), which is making a Botox-like product, netted about $60 million in a February IPO; it has a market value of about $470 million.
Bioprosthetics maker Hancock Jaffe Laboratories Inc. (NASDAQ: HJLI) went public in May, netting a modest $8.6 million. It’s valued at about $30 million.
Tim Rahall, Technology Partner with Ernst & Young’s Irvine office, has helped take a number of Southern California companies public in the last fifteen years.
He expects to see more OC-based IPOs going forward in the remainder of this year and next year.
“I see some IPO activity [in] Q4 and 2019,” Rahall said. “I would expect an IPO in Q4, amount to be determined. There’s just a lot of private capital out there now that’s enabled companies to avoid the public markets.”
There were 20 IPOs in the Western U.S. in Q3, according to EY’s global IPO analysis.
Eight of the Western-based firms that went public were in the life sciences sector, like Urovant.
“Life sciences are dominating the IPO market,” Rahall said. nUrovant Sciences Ltd., an Irvine-based clinical-stage biopharma company that started operations in 2016, raised nearly $140 million in its initial public offering last week.
It’s the biggest offering of any Orange County-based company to go pubic via a traditional IPO this year.
Wall Street is taking a skeptical view of the upstart company’s prospects, based on early returns.
Urovant priced the 10 million share offering at $14 each, on the low end of its expected $14 to $16 per share range.
Its stock, which trades on the Nasdaq under the UROV ticker, came out of the gates even lower, trading around $11 per share last Thursday, its first full day of trading.
Shares were hovering around $11.50 by the time the Business Journal went to press on Friday, giving Urovant a market capitalization of about $345 million.
The offering was underwritten by J.P. Morgan, Jefferies Financial Group Inc. and Cowen Inc. Urovant will use the proceeds to fund clinical trials for its licensed products; working capital and general corporate purposes.
Urologic Drugs
Urovant plans to develop and commercialize drugs for urologic conditions, in particular the treatment of overactive bladder, a medical condition characterized by a sudden urge to urinate that’s difficult to control.
The company’s one of 12 “vants” falling under the umbrella of biotech entrepreneur Vivek Ramaswamy’s Roivant Sciences Ltd., a Basel, Switzerland-based firm that aims to take advantage of abandoned or deprioritized drugs that aren’t priorities in the pipelines of large pharma companies. Roivant was the sole shareholder of Urovant prior to the IPO, and now owns about 67% of the company’s stock.
Urovant is headed by Chief Executive Keith Katkin, who joined the company a year ago. He previously served as president and chief executive of Aliso Viejo-based Avanir Pharmaceuticals Inc., and led the nervous system disorder-focused drug development company through its $3.5 billion sale to Japan-based Otsuka Pharmaceutical Co. in 2015.
As is typical for many clinical-stage biopharm firms that are yet to see sales, the company’s run up a substantial amount of losses since its founding, with a $95.5 million accumulated deficit.
It said in regulatory filings that it expects “to continue to incur substantial and increasing losses through the commercialization of our product candidates.”
Urovant’s the third company based in OC to go public via an IPO this year; the other two are also in the healthcare sector and based in Irvine.
Drug developer Evolus Inc. (NASDAQ: EOLS), which is making a Botox-like product, netted about $60 million in a February IPO; it has a market value of about $470 million.
Bioprosthetics maker Hancock Jaffe Laboratories Inc. (NASDAQ: HJLI) went public in May, netting a modest $8.6 million. It’s valued at about $30 million.
Tim Rahall, Technology Partner with Ernst & Young’s Irvine office, has helped take a number of Southern California companies public in the last fifteen years.
He expects to see more OC-based IPOs going forward in the remainder of this year and next year.
“I see some IPO activity [in] Q4 and 2019,” Rahall said. “I would expect an IPO in Q4, amount to be determined. There’s just a lot of private capital out there now that’s enabled companies to avoid the public markets.”
There were 20 IPOs in the Western U.S. in Q3, according to EY’s global IPO analysis.
Eight of the Western-based firms that went public were in the life sciences sector, like Urovant.
“Life sciences are dominating the IPO market,” Rahall said.
