Oncobiologics, a US-based clinical-stage biopharmaceutical company backed by pharmaceutical firm Strides Arcolab, has raised $35m from an initial public offering on Nasdaq.
The company issued 5.8 million shares priced at $6 each, far below its anticipated range of $11 to $13. Oncobiologics had originally filed for a $115m offering in January 2016.
Sabby Healthcare Master Fund is expected to invest $5m in a concurrent private placement, while a range of existing, unnamed investors are set to acquire a total of $20m worth of shares as part of the IPO.
Founded in 2011, Oncobiologics is developing complex biosimilar therapies, initially focusing on immunology and oncology.
The company intends to use the IPO proceeds to advance drug candidates through clinical trials and support research and development efforts, with the remainder to be used for working capital and general expenditures.
Oncobiologics received $31m in series D funding from Perceptive Advisors, Cormorant Global Healthcare Master Fund, Longwood Capital Partners, VenBio Select Fund, Proximare Lifesciences Fund, OSSB Pharma Fund and MIH Fund in July 2015.
The company has since secured an additional $20.8m from unnamed investors, according to regulatory filings, adding to the $7.2m it had raised in earlier rounds.
Strides Arcolab provided an additional $7m in March 2014 before investing an additional $2m three months later. Strides Pharma, the UK-based subsidiary of Strides Arcolab, is listed as the only external shareholder with a share of 5% of more, holding a 10.8% stake that has been diluted to 7.6%.
Oncobiologics has granted the underwriters a 30-day option to purchase up to an additional 875,000 shares which, if fully exercised, could boost the offering to $40.3m.
Jefferies and Barclays Capital are acting as joint book-running managers, while Cantor Fitzgerald is serving as co-manager. Onciobiologics began trading on Friday and its shares had dropped to $4.80 by close.