Fusion Pharmaceuticals, a Canada-based cancer drug developer backed by pharmaceutical group Johnson & Johnson and medical device maker Varian Medical Systems, raised almost $213m when it went public on Friday.
The initial public offering involved the company increasing the number of shares in the IPO from 8.35 million to 12.5 million and pricing them at $17 each, above the $14 to $16 range it had set the previous Monday. It floated on the Nasdaq Global Select Market.
Underwriters Morgan Stanley, Jefferies, Cowen and Company and Wedbush Securities have the 30-day option to acquire nearly 1.9 million additional shares which would boost the size of the offering to more than $244m. The company’s shares opened at $18.50 and closed back at $17.00, valuing it at $710m.
Fusion is working on radiopharmaceuticals designed to treat cancer by emitting radioactivity to kill cancer cells. The therapies will utilise targeting molecules, like antibodies, in order to restrict the damage of surrounding healthy tissue.
The company intends to use $43m to $53m of the IPO proceeds to guide its lead product candidate, a FPI-1434, through an ongoing phase 1 clinical trial for solid tumours as well as a planned phase 2 trial.
Up to $25m of the proceeds will fund a phase 1 trial for a second candidate, FPI-1966, in bladder cancer and head and neck cancers, while $30m to $35m will go to other research and development activities.
Fusion secured $46m in a 2017 series A round featuring $8m from Johnson & Johnson’s corporate venturing arm, Johnson & Johnson Innovation – JJDC, $2m from Varian and additional capital from Adams Street Partners, Seroba Life Sciences, HealthCap, Genesys Capital, Facit and TPG Biotech.
Varian subsequently invested $22m in the company’s $112m series B round, which closed earlier this month, while Johnson & Johnson Innovation – JJDC provided $7.7m, the completion of the round following a $105m first close in April 2019.
The round included property developer Nan Fung’s Pivotal BioVenture Partners fund, HealthCap, Adams Street Partners, TPG Biotech, Seroba Life Sciences, Genesys Capital, Facit, OrbiMed, Perceptive Advisors, Rock Springs Capital and Canada Pension Plan Investment Board. (CPPIB).
Varian’s stake stands at 7.9% post-IPO while Johnson & Johnson Innovation – JJDC’s is sized at 7.3%. Fusion’s other notable shareholders are HealthCap (8.8%), Adams Street Partners (8.6%), CPPIB (5.9%), TPG (5.7%), OrbiMed (5.5%) and Seroba Life Sciences (4.6%).
