More data, more dollars: Three biotechs post offerings after trial readouts
The pattern goes as follows: roll out the data first, and then go to investors and ask for more money.
Three biotechs played right into that strategy on Tuesday.
The first was Jasper Therapeutics, which kicked things off Tuesday afternoon by announcing it plans on selling shares via a public offering. Jasper elaborated Wednesday morning, disclosing it would sell 60 million shares of stock at $1.50 each, for around $90 million. The stock $JSPR ticked up more than 10% after the opening bell.
While the statement said the biotech intends to use the proceeds for general expenses, working capital and capital expenditures, an SEC filing also noted Jasper may use a portion of the financing to “acquire or invest in other businesses, products and technologies that are complementary to our own.” However, there are no current plans to do just that.
This announcement comes after a positive data readout earlier in January, where Jasper’s anti-c-KIT monoclonal antibody, known as briquilimab, was tested in a trial alongside an existing bone marrow transplantation regimen for three patients with sickle cell disease. The goal of the trial was to see if adding the antibody would lead to a higher percentage of stem cell engraftment without increased toxicity. All patients treated were successfully engrafted, Jasper said at the time, and had no adverse effect related to briquilimab.
Next up is penny-stock Verastem Oncology, which put out word less than 90 minutes after Jasper on Tuesday that it was raising $60 million in a private placement offering. How it’s getting the money, according to a statement, is by selling 2.1 million shares of preferred stock to affiliates of venture capital firm BVF Partners.
That placement came after releasing initial tranches of data earlier Tuesday from an ongoing Phase II study looking at a combination treatment in patients with recurrent and heavily pre-treated LGSOC, or low-grade serous ovarian cancer. Out of 29 patients that could be evaluated, Verastem reported an ORR of 28%.
Lastly was Precigen, which reported several hours after the other companies on Tuesday night that it would be raising $75 million via a public offering.
The biotech said it would be selling more than 42 million shares of common stock at $1.75 each, giving underwriters 30 days to buy another 6.4 million shares at that price and closing Friday. Per an SEC filing, Precigen plans to use the funds for “general corporate purposes,” which may include clinical trials, further R&D, working capital, and more.
Just like Jasper and Verastem, the offering comes on the heels of a data readout. Earlier that day, Precigen announced positive Phase I data for an investigational immunotherapy in patients with recurrent respiratory papillomatosis, a disease of the upper respiratory tract where recurrent, wart-like growths appear on the surface of the vocal cords or the surrounding tissue. It is caused by infection from HPV-6 or HPV-11. Patients have no approved therapy, as growth-removal surgery is the current standard of care.
Clinical data from the Phase I showed the immunotherapy reduced the need for surgeries in patients at the higher of two dose levels. Half of those in that higher dose group showed no need for surgeries for 12 months after finishing treatment with the immunotherapy candidate.
Despite the data, the share price of $PGEN opened Wednesday morning down almost 30%.