Kymera Therapeutics, a US-based small molecule drug developer backed by pharmaceutical firms Pfizer, Sanofi, Merck & Co, Amgen and Vertex Pharmaceuticals, went public on Friday, raising nearly $174m in an initial public offering.
The company increased the number of shares in the offering from 7.4 million to more than 8.68 million and priced them at $20.00 each, above the $16 to $18 range it had set.
Vertex Pharmaceuticals bought approximately $11.8m of shares in the IPO. Kymera’s shares opened on the Nasdaq Global Market at $35.00 on Friday and closed at $33.26, giving it a market cap above $1.43bn.
Kymera is working on small molecule therapeutics designed to attack diseases by degrading targeted disease-causing proteins. It will put $27m of the IPO proceeds into a phase 1 clinical trial for IRAK4, a product candidate targeting inflammatory and autoimmune diseases.
Another $24m will go to a phase 1 trial for a second candidate, IRAKIMiD, and $28.9m to development of a third candidate, STAT3. The company has disclosed $217m in equity funding altogether.
Amgen and Eli Lilly co-led Kymera’s $30m series A round in 2017 through subsidiaries Amgen Ventures and Lilly Ventures, participating alongside Atlas Venture, the venture capital firm in which it was incubated.
The company added $65m in a late 2018 series B round co-led by Pfizer’s investment arm, Pfizer Ventures, with 6 Dimensions Capital, an investment firm co-founded by pharmaceutical company WuXi AppTec, and VC firm Bessemer Venture Partners (BVP).
All the series A investors returned for the series B, which included Merck’s MRL Ventures Fund, Sanofi unit Sanofi Ventures, Aju IB Investment and Hatteras Venture Partners.
Biotechnology Value Fund and Redmile Group co-led Kymera’s $102m series C round in March this year, investing with Wellington Management, Bain Capital Life Sciences, Rock Springs Capital, funds managed by Janus Henderson Investors and BlackRock, and unnamed existing backers.
Kymera also expects to receive a $150m upfront payment from Sanofi this month in connection with a collaboration agreement. Vertex had made a $20m equity investment in the company in May 2019 through a similar deal.
Vertex held a 7.3% stake prior to the offering that was set to be diluted to 5.7% before its share purchase. The company’s notable investors include Atlas Venture, owner of a 21% stake post-IPO, Lilly Ventures (5.1%), Pfizer, 6 Dimensions Capital and BVP (4.1% each).
Joint book-running managers Morgan Stanley, BofA Securities, Cowen and Guggenheim Securities have a 30-day option to acquire just over 1.3 million additional shares and Vertex about 88,000. Those purchases would jointly lift the size of the offering to more than $201m.
