Ovid Therapeutics, a US-based neurological disorder therapy developer backed by pharmaceutical firms Takeda and Sanofi, has raised $75m in an initial public offering, issuing 5 million shares priced at $15.00 each.
Ovid is developing drugs to treat rare neurological disorders and will use $35m of the proceeds to finish a phase 2 trial for its lead product candidate, OV101, for adults, and a phase 1 trial for children, suffering from the genetic disorder Angelman syndrome.
An additional $17m will support a phase 1b/2a trial for a second candidate, OV935, for patients with a brain disorder known as epileptic encephalopathies. Ovid will put a further $7m toward ongoing research and development activities.
The company had received $115m in equity funding prior to the offering, including $75m in a 2015 series B round led by financial services group Fidelity Management and Research that included Sanofi’s corporate venturing unit, Sanofi-Genzyme BioVentures.
Cowen Private Investments, Tekla Capital Management, Sphera Global Healthcare Fund, Jennison Associates, Redmile Group, Cormorant Asset Management and DoubleLine Equity Healthcare Fund also participated in the series B round.
Takeda invested in Ovid in January 2017 when the companies formed a development and commercialisation agreement. Its 9.1% stake was diluted to 7.2% in the offering while Shira Capital, the only other investor with a share of the company 5% or higher, had its own stake cut from 5% to 4%.
Citigroup and Cowen and Company are joint book-running managers for the IPO while William Blair & Company and JMP Securities are co-managers. The underwriters have a 30-day option to buy another 750,000 shares, which would push the size of the offering to just over $86m.
Ovid’s stock opened at $14 on Nasdaq before closing at $12.25 on its first day of trading on Friday.