BioCryst was ready for the public markets, but after shares sank 14% in the wake of the announcement, the rare disease company is making a U-turn.
The company has withdrawn a proposed $200 million public offering after deciding “current market conditions are not conducive to an offering on terms that would be in the best interests of our current stockholders.”
Public investors have lined up to pump money into biotechs over the first half of the year, plowing a record $9 billion into IPOs and $41 billion into follow-on offerings. BioCryst disclosed plans to add to the tally on Tuesday, which spurred shares to drop from around $17 to $15 at close. Now, the company’s shares are once again trending upwards after the offering has been withdrawn, but are still sitting in the $15 range.
BioCryst ended June with $222.8 million in cash, cash equivalents, restricted cash and investments. With two drugs on the market and access to a $75 million credit facility, BioCryst expects the current cash runway to extend out to 2023.
The additional $200 million targeted by the withdrawn offering was earmarked for general corporate purposes, including the development of BCX9930 for complement-mediated diseases. BCX9930 is an oral factor D inhibitor that is moving into two pivotal trials in paroxysmal nocturnal hemoglobinuria (PNH). Enrollment is scheduled to start this year.
Targeting PNH puts BioCryst up against Alexion, which was recently bought by AstraZeneca for $39 billion after dominating the indication for years. BioCryst, which has a market cap of around $2 billion, sees reasons to think BCX9930 can challenge the incumbent.
“BCX9930 has a great opportunity to substantially improve PNH disease control compared to the currently available intravenous C5 inhibitors because it can address both extravascular and intravascular hemolysis. These clinical advantages come on top of the expected dramatic reduction in burden of therapy,” Bill Sheridan, chief medical officer at BioCryst, told investors on a recent quarterly results conference call.
BioCryst will now need to run the trials without the benefit of an additional $200 million in funding. The withdrawal of the BioCryst offering comes weeks after Dynacure pulled its IPO submission.