The path to becoming a publicly listed company chosen by Coronado Biosciences (NASDAQ: CNDO) was anything but conventional, but it seems to be working for the biotech startup. After raising $47.4 million privately over the last year, the company filed a Form 10 with the SEC so it could become a public company by registering all its private shares as common stock, rather than undergoing a typical, underwritten IPO. Coronado—which moved from New York City to Burlington, MA, in August—was approved to trade over the counter in mid-November. Then, on December 15, the Nasdaq approved Coronado for listing. The stock will begin trading today at an opening price of $6.50.
But by choosing to go it alone, without an underwriter, Coronado has shouldered the entire onus of attracting investors. CEO Bobby Sandage says he’s been making the rounds at investment conferences, and working hard to meet Nasdaq’s minimum requirements for publicly listed companies. “We need a certain number of shareholders, and with 550 we’re well above the requirement,” he says. “We needed a minimum bid price of $4 and for the stock to be trading every day. We got our volume up to the 10,000-to-20,000 range.” It also helped that on November 22, an analyst for Roth Capital Partners began covering Coronado in a report declaring the company to be “the caviar of biotech.”
Investors have high hopes for Coronado’s two lead compounds: CNDO-201 to treat the intestinal disorder Crohn’s disease, and CNDO-109 to treat acute myeloid leukemia. The company is preparing to start Phase 1 studies of CNDO-201, a drug that contains 2,500 eggs from a parasite found in pigs. If all goes well, Sandage says, the Phase 2 will begin in the second quarter of 2012.
And last week at the American Society of Hematology annual meeting in San Diego, Coronado presented data from a Phase 1 study of its cancer compound CNDO-109. The study showed that the drug lengthened remission rates. Coronado is planning a second trial for early 2012.
After an early trade at $11 when Coronado was on the OTC bulletin board, shares have fallen back to the $6 range. Because Coronado went public via a Form 10, there was no set offering price—the price will be determined entirely by the market. Sandage isn’t concerned. “Now there are many more broker-dealers who can trade the stock,” he says. As for Coronado’s speedy route from the OTC market to a true Nasdaq listing, Sandage hopes it sends a positive signal to antsy biotech investors. “I think Nasdaq saw that Coronado was a real company,” he says.
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