Last week's two biotech IPOs - Aquinox Pharmaceuticals (
) and Recro Pharma (
) - posted an average return of only 6% on their first day of
trading on Friday. While Recro has continued to trade poorly,
Aquinox has enjoyed a strong week, bringing its IPO return to
25%. Achaogen (
), which develops antibiotics that treat drug resistant
infections, priced at the low end of the range on Tuesday but
gained 19% on its first day and is up another 14% today. The two
biotechs that began trading today have also had positive returns.
Dipexium Pharmaceuticals (
), which has developed a topical cream for diabetic foot ulcers,
is trading 17% above issue. Galmed Pharmaceuticals (
) targets liver diseases with its once-daily oral therapy and is
currently up 6%.
Biotech IPOs in the past two weeks have been notably smaller,
raising only $44 million on average, 43% less in proceeds than
the sector's average this year. In general, pricing has not been
aggressive for biotechs as most have priced below their midpoint
(including four that opened more than 40% below the midpoint).
That trend of discounts has contributed to aftermarket returns
for biotechs averaging 30%, compared to the year's 21%
average. More biotech IPOs are on the way as well; only
biotech and tech IPOs are scheduled for next week.
This Week's Biotech Offerings
Deal Size ($mm)
First day pop
|Dipexium Pharmaceuticals (
|Galmed Pharmaceuticals (
A wave of software company IPOs kicks off tonight with the
pricing of Castlight Health (CSLT) and continues with six more
next week. Castlight provides on-demand software to help
self-insured employers control health care costs, an apt IPO
given the amount of tech and health care activity so far.
Paylocity (PCTY), a payroll and human capital management SaaS
provider, is a direct competitor to Paycom, which filed an S-1 on
Monday. Globoforce (THNX) provides cloud-based software that
recognizes and rewards employee achievements. Q2 Holdings
(QTWO) sells its online banking SaaS platform to community banks.
Looking to raise $175 million (next week's largest deal), A10
Networks (ATEN) provides network devices and software to optimize
company data centers. The final two of the tech wave both support
global trade, with Amber Road (AMBR) selling a SaaS product that
helps companies automate import and export processes and
Borderfree (BRDR) providing an e-commerce platform for US
retailers selling abroad.
Vote here to give your opinion on these upcoming