US-based gastrointestinal disease therapy developer Phathom Pharmaceuticals went public on Friday in an initial public offering sized at approximately $182m while pharmaceutical firm Takeda boosted its stake.
The company increased the number of shares in the offering from 7.9 million to approximately 9.56 million and priced them at $19.00 each, in the middle of the $18 to $20 range it set last week. It floated on the Nasdaq Global Select Market.
Phathom is developing therapeutics intended to treat gastrointestinal disease. Its lead drug candidate, Vonoprazan, is a small molecule treatment licensed from Takeda, which had marketed it in Japan since 2014.
The company will use part of the IPO proceeds to fund clinical trials for Vonoprazan as it seeks to secure regulatory approval for the drug in the US, and ultimately Canada and Europe.
The licensing agreement will involve Takeda receiving almost 7.6 million shares in Phathom alongside the flotation, and will increase its stake from 9.1% to 24.7%. The company’s largest shareholder, Frazier Healthcare Partners, has a 41.1% stake set to be cut to 22.6%.
Phathom had secured $90m in crossover financing from Frazier, Medicxi, RA Capital Management, Abingworth, Janus Henderson Investors, BVF Partners, Greenspring Associates, Richard King Mellon Foundation, Sahsen Ventures and unnamed private investors in May 2019 alongside a $50m loan facility from Silicon Valley Bank.
Joint book-running managers Goldman Sachs, Jefferies and Evercore ISI, and lead manager Needham & Company have the 30-day option to acquire more than 1.43 million additional shares, which would increase the size of the offering to $209m. Phathom’s shares closed at $24.60 after their first day of trading.
