US-based gene therapy developer Akouos went public on Friday in an initial public offering sized at approximately $213m, scoring exits for pharmaceutical firm Novartis and health system manager Partners HealthCare.
The company priced 12.5 million shares at $17.00 each, increasing the number of shares in the offering from 8.3 million and pricing them above the offering’s $14 to $16 range. The numbers are virtually identical to those of another life sciences company, Fusion Pharma, which floated the same day.
Akouos’ shares closed at $21.50 on their first day of trading on the Nasdaq Global Select Market, valuing it just short of $700m.
Founded in 2016, Akouos is developing gene therapies that will help patients suffering from hearing loss, and will spend $35m of the IPO proceeds on a phase 1/2 clinical trial for its lead product candidate, AK-OTOF, to combat hearing loss caused by mutations in the OTOF gene.
About $40m will go to kickstarting clinical development of three other drug candidates while $35m will find preclinical work on products including a treatment for autosomal dominant hearing disorder and a hair cell regeneration product. Another $10m will support work on Akouos’ manufacturing capacity.
Real estate developer Nan Fung’s Pivotal BioVenture Partners fund invested $15m to lead the company’s $105m series B round in March this year, which included Novartis unit Novartis Venture Fund and Partners HealthCare’s Partners Innovation Fund.
Financial services and investment group Fidelity also took part in the round, as did Cormorant Asset Management, Cowen Healthcare Investments, EcoR1 Capital, Polaris Founders Fund, Wu Capital, Pagsgroup, Surveyor Capital, New Enterprise Associates (NEA), 5AM Ventures, RA Capital Management and Sofinnova Investments.
NEA and 5AM Ventures co-led a $50m series A round for Akouos in August 2018 that also featured Novartis Venture Fund, Partners Innovation Fund, Sofinnova Ventures and RA Capital. It had received $7.5m in seed funding from Partners Innovation Fund, 5AM Ventures and NEA the previous year.
The largest investors in Akouos are 5AM Ventures, owner of a 13.3% stake diluted from 21.6% in the offering, NEA (11.4%), Pivotal BioVenture Partners (4.6%), RA Capital and Sofinnova Ventures (4.5% each), Novartis Bioventures (3.3%) and Fidelity (3.1%).
Joint book-running managers BofA Securities, Cowen and Piper Sandler and lead manager BITG have the 30-day option to buy nearly 1.9 million more shares to lift the size of the offering to over $244m.
