Alder Biopharmaceuticals, a US-based company researching antibodies for medical treatments, went public yesterday in an $80m initial public offering priced substantially below its target raise.
The company, which had initially sought to raise up to $115m, issued 8 million shares priced at $10.00 each. The lower price follows that of another biopharmaceutical company, Aldeyra Therapeutics, which raised $12m from an IPO earlier this week after floating beneath its range, and indicates that the biotechnology IPO boom could be approaching its end.
Alder had raised $105m in equity funding across four rounds prior to the offering, and its second largest shareholder is Novo, the Denmark-based pharmaceutical company that saw its stake diluted from 14.7% to 11.6% in the IPO despite spending $4.5m on another 450,000 shares.
Other investors in Alder include venture capital firm Sevin Rosen, which remains the company’s largest shareholder with a 17.4% stake, Ventures West, H.I.G. Venture Partners, Delphi Ventures and TPG Biotech, a subsidiary of private equity firm TPG.
Approximately $37m of the proceeds from the IPO will be invested in a Phase 2b clinical trial for ALD403, an antibody intended to help prevent migraines, while a further $5.5m will go to preclinical product development.
Underwriters Credit Suisse Securities (USA), Leerink Partners, Wells Fargo Securities and Sanford C. Bernstein & Co. They have the option to acquire another 1.2 million shares over a 30-day period, which could potentially lift the IPO proceeds to $92m.