In a region known for tech start-ups and an army of software engineers, biotech companies have helped lead the recent IPO boom in Washington State, accounting for 8 of the 11 companies that have entered the public market through traditional IPOs in the past year.
Since the beginning of July, three of these companies have gone public: drug discovery platform company Absci has raised US$200 million, vaccine developer Icosavax has raised US$180 million, and neurotherapy company Eliem Therapeutics has raised US$80 million.
In the past 12 months, Washington state biotech companies have raised more than $2 billion in public offerings.
This is an unprecedented trend. In the past four years, Adaptive Biotechnologies has been the only listed biotech company in Washington State.
The surge in regional biotech IPOs reflects what is happening around the world. The number of biotech companies going public in 2020 will hit a record high. A new mark is expected to be set this yearAccording to statistics, there were 92 biotech IPOs this year, raising a total of US$12.9 billion. Endpoint news.
With the rapid development of COVID-19 vaccines and therapies, investor interest has increased, and this epidemic has promoted the development of biotechnology. The international IPO market also hit a record high, with the number of transactions and earnings in the second quarter hitting new highs in 20 years. A report From Ernst & Young. This trend is driven by several factors, including low interest rates that make stock investment more attractive.
It can take many years and hundreds of millions of dollars to bring a drug to market.Software companies generally tend to wait for revenue to stabilize at more than $100 million before proceeding with an IPO, but biotech companies are seeking long-term funding, stating Oren Lang-Four, Assurance partner of Ernst & Young and head of Seattle Life Sciences.
“Biotechnology is a capital-intensive business. These companies think the market is favorable,” he said.
Lang-Furr added: “In the past 20 years, there has been a series of huge transactions in the biotechnology field, some of which have been reinvested in Seattle.”
When the market is tight, IPO activities tend to be concentrated in the major biotechnology centers in San Francisco and Boston. Robert Friedman, Co-chair of the Capital Markets and Open Markets Group of Fenwick Law Firm. But now “investors are casting a net,” and “they recognize that there is more,” said Friedman, who is based in Fenwick’s San Francisco office but also does business in Seattle.
The field of biotechnology in the Pacific Northwest is healthy and evolving. Part of the reason is that veterans of previously successful biotech companies stayed in the game.
For example, the leader of Sana Biotechnology is Steve Hall, The former chief financial officer and head of corporate development of Juno Therapeutics, a Seattle company that went public in 2014 and was later acquired by Celgene for $9 billion. Sana raised $587 million in its IPO earlier this year, only three years after its establishment.
Chief Executive Officer Bob Azabi He is also Juno executive and CEO of Seattle biotechnology company Alder BioPharmaceuticals, which went public in 2014 and was acquired by Lundbeck in 2019.
There are also some former software entrepreneurs who have jumped into the biotechnology field, such as Isilon co-founder Sujal Patel, who is the leader of the protein analysis company Nautilus Biotechnology, which raised US$345 million through the SPAC merger in June.
Friedman said that proven leadership helps attract capital and “big-name” investors. “Good executives, good investors: I think it’s a bit like a snowball,” he said. He added: “We will see how long it will last.”
Leslie AlexanderThe CEO of the Washington Life Sciences Industry Group is optimistic about the Washington biotechnology field, with deepening expertise and strong research institutions, including the Fred Hutchinson Cancer Research Center and the University of Washington.
“Although some Washington companies may have used the open IPO window to go to market earlier than expected, I believe most of what we have witnessed reflects the maturity of our local industry,” she said.
In the past year, two other biotech companies in the state went public through mergers, including Nautilus Biotechnology and Chinook Therapeutics, a kidney therapy company. Available in October.
The following is a summary of Washington State biotech companies that have gone public since August 2020: