Phathom Pharmaceuticals, a US-based gastrointestinal disease drug startup backed by pharmaceutical company Takeda, has set the terms for an initial public offering that could raise up to $158m.
The company intends to issue 7.9 million shares on the Nasdaq Global Market priced between $18 and $20 per share, placing the offering’s potential size at $142m to $158m, and potentially almost $182m if the underwriters take up the over-allotment option to buy nearly 1.2 million more shares.
Founded in 2018, Phathom is working on gastrointestinal disease treatments and will use $100m of the IPO takings to support clinical development of its lead product candidate, Vonoprazan, a small molecule drug that blocks acid secretion in a patient’s stomach.
Takeda originally developed Vonoprazan, which has generated $500m of sales in its home country of Japan since going on sale in 2014.
The company has obtained regulatory approval in nine more countries across Asia and Latin America but licensed the US, Canadian and European rights to Phathom, which intends to take it through phase 3 trials to secure US approval.
As part of the licensing agreement, Takeda will receive almost 7.6 million shares in the company once the IPO closes, boosting its stake from 9.1% to 25.9%. Venture capital firm Frazier Healthcare Partners owns a 41.1% share that will be diluted to 24.1%.
Phathom emerged from stealth in May 2019 with $90m of crossover financing from investors including Frazier, which provided $20m, and life sciences investment firm Medicxi, which committed $15m.
Richard King Mellon Foundation, Sahsen Ventures Janus Henderson Investors, BVF Partners, RA Capital Management, Abingworth and Greenspring Associates also took part along with unnamed individual investors, while Silicon Valley Bank provided a $50m loan facility.
Goldman Sachs, Jefferies, Evercore Group and Needham & Company have been appointed underwriters for the IPO.
