Ra Pharmaceuticals, a US-based developer of rare blood disorder treatments, raised $91.6m yesterday in an initial public offering that gave exits to pharmaceutical firms Novo, Novartis and Amgen.
The company priced just over 7 million shares at $13 each, in the middle of the $12 to $14 range it set last week. In its first day of trading on Nasdaq Ra’s shares briefly rose as high as $14.86 before closing back at $13.00.
Ra is developing drugs to treat serious diseases caused by excessive or uncontrolled activation of a part of the immune system called the complement system. It will spend $33m of the IPO proceeds to advance its lead candidate, a blood disorder therapeutic called RA101495, through phase 2 clinical trials.
Another $11m will fund trials for RA101495 in two more disorders, and $18.9m will go to the development of additional pipelines.
The offering follows a $58.5m series B round in July 2015 that was co-led by Novo Ventures, a corporate venture capital subsidiary of Novo, and which featured Novartis Venture Fund and Amgen Ventures, the respective CVC units of Novartis and Amgen.
RA Capital Management and Lightstone Ventures co-led the series B round, which included Rock Springs Capital, Limulus Venture Partners, New Enterprise Associates (NEA) and Morgenthaler Ventures.
Ra had secured $27m in a 2012 series A round backed by Novartis Venture Fund, Amgen Ventures, NEA and Morgenthaler Ventures.
The share of Ra held by Novartis subsidiary Novartis Bioventures was diluted from 17% to 11.5% in the offering, while Novo’s shrunk from 12.4% to 8.3%. Amgen’s stake was sized at less than 5%.
NEA remains the company’s largest external shareholder with a 14.7% stake post-IPO. Other substantial shareholders include Morgenthaler (11.6%), Lightstone Ventures and RA Capital (5.5% each).
Credit Suisse Securities (USA), Jefferies and BMO Capital Markets are joint book-running managers for the offering while SunTrust Robinson Humphrey is lead manager.
The underwriters have a 30-day option to buy up to buy more than 1 million additional shares, which would lift the size of the IPO to over $105m.