US-based, corporate-backed medical device developer Nevro raised $126m from its initial public offering on Thursday, issuing 7 million shares priced at $18.00 each, above its $15-$17 range.
Founded in 2006, Nevro has created a spinal cord stimulation platform called Senza to treat chronic pain. It plans to spend between $60m and $80m obtaining regulatory approval for the project in the US, and commercialising it afterwards.
Prior to the IPO, Nevro raised approximately $153m in funding from investors including pharmaceutical companies Novo and Johnson & Johnson, which invested through its Johnson & Johnson Development Corporation (JJDC) unit, medical researcher Mayo Clinic and medical device company Covidien.
JJDC, which remains Nevro’s largest shareholder with a 12.9% stake that was diluted from 18.1%, invested $720,000 in the offering, while Novo invested approximately $3.9m. Its stake in the company decreased from 11.8% to 9.2%.
Other shareholders in the company include Bay City Capital (9.3%), Three Arch Partners (9.3%), AMV Partners (7.1%), Aberdare Ventures (6.8%) and New Enterprise Associates (5.8%). NEA also invested almost $2m in the offering.
Nevro’s stock opened on the New York Stock Exchange at $23.40 on Thursday and closed at $25.30 on Friday.
J.P. Morgan and Morgan Stanley, the joint book-running managers for the offering, and co-managers Leerink Partners and JMP Securities have the 30-day option to buy another 1.05 million shares, which would lift the size of the IPO to $144.9m.