Revolution Medicines, a US-based precision oncology drug developer backed by pharmaceutical firm Sanofi, set terms yesterday for an initial public offering set to raise up to $160m.
The company set the range for the offering at $14 to $16 and plans to issue 10 million shares on the Nasdaq Global Market next week. JP Morgan Securities, Cowen and Company, SVB Leerink and Guggenheim Securities are joint book-running managers for the proposed IPO.
Founded in 2014, Revolution is working on therapies for a range of cancer indications. It is focusing on inhibitors of frontier targets, proteins that play an important role in cancer but for which no treatment exists, or where current therapies do not suppress all factors contributing to cancer growth.
The company’s lead asset, RMC-4630, is is being co-developed with Sanofi and is aimed at various tumour types. It is currently undergoing phase 1/2 trials.
Sanofi became a shareholder in Revolution when the latter purchased Warp Drive Bio, a genomic medicine developer co-founded by the pharmaceutical firm, in an all-share deal in late 2018.
Revolution raised $100m in a July 2019 series C round led by Boxer Capital that included investment and financial services group Fidelity Management & Research, Third Rock Ventures, Deerfield Management, Cormorant Capital, Vivo Capital, Schroder Adveq, Column Group, Casdin Capital, Nextech Invest and Biotechnology Value Fund.
Nextech Invest had led a $56m series B round for the company in April 2018 that also featured Casdin, Shroder Adveq, Third Rock, Column Group and unnamed backers. Third Rock supplied $45m in series A funding for Revolution in 2015 before returning the following year for a $25m extension alongside Column Group.
The company has allocated $100m of the IPO proceeds and its existing cash resources to the development of its drug pipeline, through to investigational new drug-enabling studies for at least one asset.
Another $10m is going towards the development of RMC-5552, a potential treatment for breast cancer and a type of brain cancer called orthotopic glioblastoma multiform. Revolution will also use $1m to fund its share of research costs related to its Sanofi partnership.
Sanofi currently owns a 7.8% stake in the company through its Sanofi Research Invest division that is set to be diluted to 6.4%. Revolution’s largest shareholder is Third Rock, which will see its share diluted from 28.8% to 23.4%, while Column Group will come out with a 15.1% stake.
