12:00 AM
Oct 27, 2014
 |  BioCentury  |  Finance

Waiting for better times

Why Molecular Partners postponed the fourth-largest EU biotech IPO since 2008

Poised to complete the fourth-largest European biotech IPO since 2008, the road show for Molecular Partners AG had the poor luck of coinciding with the largest one-week drop in the broader capital markets since the start of 2013. Because it has plenty of cash, the protein scaffold play decided to postpone its listing on the SIX Swiss Exchange.

On Sept. 23, Molecular Partners filed to raise up to CHF125 million ($133.1 million) in an IPO on the exchange.

"All the indicators were pointing in the right direction and we had a lot of support from both European and U.S. investors," co-founder and CEO Christian Zahnd told BioCentury. "It was just absolute bad luck that we were on a road show during the perfect storm on the capital markets."

Molecular Partners started the book-building process on Oct. 8 - the day that marked the start of a week-long tailspin for global indices. The NASDAQ Composite index fell 6% from Oct. 8 to Oct. 16, while the Dow Jones Industrial Average and S&P 500 were down 5% each in the same period.

Zahnd said there was no need "to force a deal just to get it done," as the markets slid and investors became more cautious. With about CHF100 million ($106 million) in cash, he said the company has no problem supporting its R&D programs. "We have always said that we don't have to go out. We will only go out if we can do a really strong deal."

The deal has been postponed, not pulled, and Molecular Partners hopes to complete the IPO once more favorable market conditions return.

When it does, it would be the first biotech to go public on the Swiss exchange since Addex Therapeutics Ltd. (SIX:ADXN) in 2007.

Zahnd said the decision to list on the Swiss exchange rather than NASDAQ was based on years of building a local base of support, combined with three years of getting U.S. investors familiar with the story to the point that there was strong support on both sides of the Atlantic.


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