Amid fears of a looming recession—and after a large share of biotechs saw valuations dip following their debuts on the public market in the past year—Bausch Health has put the brakes on the final piece of a long-running plan to split its company into three. The company is halting the IPO of its Solta Medical aesthetics division.
In a road map first announced last August, Solta—holder of a $300 million portfolio of skin care and body contouring devices including lasers and ultrasonic hardware—was set to go public on the Nasdaq following its official filing this past February, though no firm date was proposed at the time.
Bausch Health had envisioned Solta taking the same route as the eye care giant Bausch + Lomb, which completed its IPO on the New York Stock Exchange in early May. However, the multibillion-dollar maker of contact lenses and eye drugs missed its target, with shares selling for $18 apiece instead of the hoped-for range of $21 to $24.
The nearly 170-year old company ultimately raised $630 million, according to Bloomberg. In the time since its IPO, its share price has fallen 28% to about $14.40.
Meanwhile, Bausch Health—the company formerly known as Valeant Pharmaceuticals, which underwent a much-needed makeover in 2018 following its $8.7 billion takeover of Bausch + Lomb—was set to continue on as Bausch Pharma, manager of a $4.2 billion catalog of more than 600 drug products sold internationally.
The goal was to use the proceeds from the spinoffs to help pay down a mountain of debt, as the culmination of a years-long, multiphase effort to redirect the company. Bausch Health reported $23.6 billion in total long-term obligations, with at least $10.5 billion coming due in 2025.
But that plan is now on hold, as Solta will remain on Bausch Health’s balance sheet for the foreseeable future. The company said it will “revisit alternative paths” for the devicemaker, “in light of challenging market conditions and other factors.”
Last year saw biotechs stampede for the public markets as the industry began to open back up during the COVID-19 pandemic, with more than 100 listings in 2021. But many saw their share price plummet in the months that followed: Of the year’s top 10 IPOs by total proceeds, nine saw their stock dip by this past February.