US-based cancer treatment developer Corvus Pharmaceuticals, backed by pharmaceutical companies Novo and Roche, floated on Nasdaq yesterday, having priced 4.7 million shares at $15 each, securing $70.5m in proceeds.
The pricing is at the lower end of Corvus’ target range, set between $15 and $17 set last week. That range already represented a reduction from the $115m initial public offering that the company originally filed for in January 2016.
Founded in 2014, Corvus is working on immune-oncological therapies that exploit the human body’s immune system to attack cancer cells. Corvus has four programs in its pipeline, including one that is currently undergoing a phase 1 clinical trial.
The company hopes to use half the proceeds to fund the ongoing clinical development of its lead drug candidate through to a phase 1/1b clinical trial. The remaining cash will go towards preclinical development of its other candidates and potential in-licensing, as well as working capital.
OrbiMed Advisors led a $33.5m series A round for Corvus in 2014 that featured Novo investment vehicle Novo Ventures and Adams Street Partners.
Corvus also secured raised $75m in a September 2015 series B round led by Rock Springs Capital. Novo Ventures returned for that round, investing alongside Roche’s corporate venturing subsidiary, Roche Venture Fund.
Financial services conglomerate Fidelity Management and Research Company, OrbiMed, Adams Street, Blackrock, T. Rowe Price, Jennison Associates, Cormorant Asset Management, Sphera Funds Management, VenBio Select and Cowen Private Investments also invested in the series B round.
Novo planned to purchase an additional 625,000 as part of the IPO, seeing its stake reduced from 15.8% to 15.25%. Roche owns less than 5% and is not listed in the regulatory filing.
Corvus’ largest shareholder is OrbiMed, which committed to buying an additional 750,000 shares. Its stake will drop from approximately 30% to 26.75%. Adams Street is listed as purchasing an additional 187,500 shares and its stake will be cut 15.8% to 13.1%.
Fidelity maintained its current amount of shares and saw its stake drop from 8.2% to 6.3%.
Credit Suisse Securities and Cowen and Company are acting as joint book-running managers for the IPO. Guggenheim Securities is lead manager, while Cantor Fitzgerald and BTIG are serving as co-managers. The underwriters have a 30-day option to acquire up to a total of 705,000 additional shares.
Corvus began trading on Nasdaq yesterday and at the end of the first day of trading its share price had dropped to $14.25, giving the company a market cap of $290.8m.