The banking community didn't waste any time recuperating from summer vacations, as evidenced by a surge of IPO and follow-on activity last week. The theme of the first two follow-ons of the fall seemed pretty clear: give investors late-stage data to mull over and get about $100 million.
Thus, Vivus Inc. (NASDAQ:VVUS) raised $94.5 million on Thursday through the sale of 9 million shares at $10.50. The overnight deal saw very little price erosion - Vivus proposed the offering after market close on Wednesday, when its share price was $10.79.
The prior week, the company's Qnexa phentermine/topiramate met the primary endpoints in two Phase III trials to treat obesity. The data sent the stock up $4.67 (73%) to $11.06 that week. Vivus plans to submit an NDA to FDA by year end(see BioCentury, Sept. 14).
Underwriters were JPMorgan; JMP Securities; Lazard; and Merriman Curhan Ford.
Rigel Pharmaceuticals Inc. (NASDAQ:RIGL) also did an overnight follow-on, and the small molecule developer bumped up the number of shares to more than double the proposed amount. On Thursday, Rigel raised $94.3 million through the sale of 13 million shares at $7.25. It had proposed to sell 6 million shares late Wednesday, when its share price was $7.66.
In July, Rigel had two inflection points for lead compound fostamatinib (R788). It met the primary endpoint in a Phase IIb trial in rheumatoid athritis patients who failed to respond to methotrexate alone and continued to receive methotrexate throughout the trial. About two weeks later, fostamatinib missed the primary and secondary endpoints in a Phase IIb trial to treat RA patients who failed to respond to at least one biologic (see BioCentury, July 13 & July 27).
Prior to both announcements, Rigel was trading at $11.24.
Fostamatinib is a solid formulation of R406, a Syk kinase inhibitor. The company plans to start Phase III testing next year.
On the week, Rigel shares