As IPO queue swells, BioNTech underwhelms in NASDAQ debut

Shares of BioNTech sagged 5% to $14.24 in its first day of trading Thursday after the company priced its IPO amid diminished expectations. The German biotech had hoped to obtain a valuation well above $4 billion, but its offering price suggests a figure of about $3.4 billion.

BioNTech SE (NASDAQ:BNTX) raised $150 million via the sale of 10 million ADSs at $15, the bottom end of its $15-$16 proposed range. In a Sept. 24 prospectus, BioNTech had proposed to sell 13.2 million ADSs at $18-$20; at the $19 mid-point, BioNTech would have raised just over $250 million at a postmoney valuation of nearly $4.4 billion. Each ADS is worth one ordinary share.

BioNTech is developing a pipeline that originally consisted of mRNA-based therapeutics, but now also spans CAR Ts and other cell therapies, bispecific antibodies and small molecule immunomodulators. All of its clinical programs are in oncology, although it has preclinical programs for infectious and rare diseases.

Another large proposed offering expected to price ahead of Friday’s session -- that of Vir Biotechnology Inc. -- could further illuminate investors’ demand for new biotech listings. The immunology and infectious disease company, whose president and CEO is former Biogen Inc. (NASDAQ:BIIB) CEO George Scangos, has proposed to sell about 7.1 million shares at $20-$22; at the mid-point, it would raise $150 million at a $2.3 billion valuation (see “Vir Plots IPO”).

The IPO queue has swelled with biotechs seeking to get out before anticipated volatility during the U.S. election year (see “Flood of Biotech IPOs Ahead of 2020 Election”).

However, sentiment for offerings in the sector may be wavering.

Another IPO in the $200 million range proposed by ADC Therapeutics S.A. fell through early this month.

And among three other biotechs that listed last week, only Aprea Therapeutics Inc. (NASDAQ:APRE) traded above its listing price at Thursday’s close. With a modest gain during the session, the cancer company ended the day at $19.44, up 30% from its IPO price of $15.

Shares of Viela Bio Inc. (NASDAQ:VIE), which popped 23% in first-day trading Oct. 3, have since settled down. Viela slipped to $18.75 at Thursday’s close, below its $19 introductory price; the company struck a deal this week giving Mitsubishi Tanabe Pharma Corp. (Tokyo:4508) territorial rights to its candidate to treat neuromyelitis optica spectrum disorder (NMOSD) (see “Viela Picks Territorial Partner”).

Hearing loss company Frequency Therapeutics Inc. (NASDAQ:FREQ), which priced at $14 last week, ended Thursday’s session at $12.67 (see “After ADC’s Withdrawal, Three IPOs Price”).

Unlike some of the younger biotechs now going public, BioNTech has existed for more than a decade. Supported by the Strüngmann family office from its 2008 inception, BioNTech added U.S. investors in its $270 million series A round, announced in January 2018. This year’s series B round included investors based in Asia as well (see “BioNTech Broadens Investor Base”).

Like the IPO, the series B round brought in less cash than the company had hoped. A $100 million contribution from a Hong Kong-based investor never arrived, paring the round’s size to about $225 million from the $325 million announced in July (see “BioNTech Will Do Without $100M”).

Including private rounds, cash from partnerships and non-dilutive grants, BioNTech had raised well over $1 billion in its history as a private company.

BioNTech’s underwriters are J.P. Morgan, BofA Merrill Lynch, UBS, SVB Leerink, Canaccord Genuity, Bryan Garnier, Berenberg, Wolfe Capital Markets, Kempen and Mirae Asset Securities.

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