Denmark-headquartered oncology drug developer IO Biotech raised $100m on Friday in an upsized initial public offering representing an exit for pharmaceutical firms Novo and Lundbeck.
The company increased the number of shares in the offering from 6.5 million to 7.15 million and priced them at the foot of the IPO’s $14 to $17 range. Its shares closed at $15.65 on the Nasdaq Global Market on Friday, giving it a market capitalisation of $413m.
IO Biotech is working on immune-modulating therapeutics to treat solid tumours and will allocate part of the IPO proceeds to phase 3 clinical trials for its lead product candidate, IO102-IO103, in first line advanced melanoma, and in phase 2 basket trials.
The offering follows over $236m in earlier funding, including a $20.8m series A round in 2016 featuring Lundbeck vehicle Lundbeckfonden Ventures, Novo fund Novo Seeds and Sunstone Capital.
HBM Healthcare Investments led the company’s $154m series B round, in January this year, which included Novo Seeds and Lundbeckfonden’s Emerge fund.
Sunstone Life Science Ventures, Vivo Capital, Kurma Partners, Avoro Capital, RA Capital Management, Samsara Biocapital, Idinvest Partners, PFM Health Sciences, Soleus Capital, Eir Ventures and Serrado Capital made up the participants in the series B round.
IO Biotech added $61.5m last month in a series C round featuring Novo, Lundbeck unit Lundbeckfond Invest, HBM Healthcare Investment, Vivo Capital and Sunstone Life Science Ventures, according to the IPO filing.
Lundbeckfond Invest’s 19% stake was cut to 13.9% in the offering while Novo’s was diluted from 14.4% to 10.5%. HBM Healthcare Investments and Vivo Capital own 8.3% each post-IPO, Sunstone Life Science Ventures 6.1%, Avoro Capital Advisors 5.8% and RA Capital Management 4.2%.
Joint lead book-running managers Morgan Stanley, Jefferies and Cowen and lead co-manager Kempen & Co have the 30-day option to buy just over 1.07 million more shares, which could boost the size of the offering to over $115m.
