NantKwest, the US-based immuno-oncology company formerly known as Conkwest, will raise $207m when it goes public later today, giving an exit to backers including Sorrento Pharmaceuticals.
NantKwest is issuing almost 8.3 million shares on Nadsaq priced at $25.00 each, above its $20 to $23 range. The price gives the company a market cap of $2.6bn, reportedly the largest ever for a biotechnology IPO.
Founded in 2002 as ZelleRx before changing its name to Conkwest, the company is developing immunotherapy drugs to treat to treat cancer, infectious diseases and inflammatory diseases.
Patrick Soon-Shiong, who became Conkwest’s CEO after investing $47.5m through his Cambridge Equities investment vehicle in December 2014, changed the name of the company to NantKwest two weeks ago so it would complement two of his other businesses, healthcare technology developers Nantworks and Nanthealth.
The company had raised about $66m in venture funding, according to regulatory filings.
Pharmaceutical firm Celgene has agreed to pay $17m for 680,000 shares in the IPO, which would give it a stake of less than 1%. Sorrento, which invested $11m in the company in December 2014, owns an 8.5% stake that will be diluted to 7.3% in the offering.
Cambridge Equities’ share will be diluted from 58% to 52.7%, while other notable shareholders include the Bonderman Family (a 5.8% stake post-offering) and NantKwest chief operating officer Barry J. Simon (4.4%)
NantKwest plans to use $30m of the proceeds to fund Phase I and I/II clinical trials for three product candidates, and another $10m to establish a manufacturing facility and hire additional staff.
BofA Merrill Lynch, Citigroup Global Markets, Jefferies and Piper Jaffray are the joint book-running managers for the offering, while MLV is serving as co-manager.
The underwriters have a 30-day option to buy another 1.28 million shares, which would raise the size of the IPO to about $246m.