Dicerna Prices Upsized IPO at $15 Per Share, Starts Trading Thursday

1/29/14Follow @benthefidler

Dicerna Pharmaceuticals had little trouble raising cash from Wall Street investors late Wednesday.

The Watertown, MA-based company has priced its IPO at $15 per share, blowing past its projected range of $11 to $13 per share. It sold 6 million shares in the offering, up from the 5 million it initially planned to sell. All told, that means Dicerna raised $90 million in cash from its IPO before underwriting discounts, a big jump from the $69 million it originally expected. And that total haul could increase if Dicerna’s underwriters, Jefferies, Stilfel, Nicolaus & Co., and Leerink Partners, exercise their 30-day option to buy an additional 900,000 shares at the IPO price.

Dicerna will begin trading on the Nasdaq on Thursday under the ticker symbol “DRNA.”

Prior to the IPO, Dicerna had raised about $110 million since its inception. Most recently, in August, it grabbed a $60 million Series C round from a group that included firms like Deerfield Management, Brookside Capital, and Omega Funds—all of which are better known for investing in public companies.

Dicerna’s top shareholders before the offering were Domain Associates (16.8 percent), Skyline Ventures (14.7 percent), Deerfield (13.4 percent), RA Capital (13.4 percent), Abingworth Management (10.3 percent), Brookside (9.4 percent), SR One (8.0 percent), and Oxford Biosciences (7.3 percent).

With the cash in the bank, Dicerna will now turn its focus to what its drug candidates can do in clinical trials. Like Alnylam Pharmaceuticals (NASDAQ: ALNY), Dicerna uses engineered RNA molecules to shut down the production of disease-causing proteins and thus hit a disease at its roots—a process called RNA interference, or RNAi. Dicerna’s approach is a bit different than Alnylam’s, however, in that it engineers RNAi molecules that are a little longer. That’s supposed to make them last longer in the body, and in theory, mean that Dicerna could give its drugs in lower doses and make them more cheaply.

Dicerna, though, has much left to prove. It’ll begin the first clinical trial for its first RNAi drug candidate this year. That experimental drug, DCR-M1711, is designed to hit the Myc gene, which is mutated in several forms of cancer but is an undruggable target, meaning it can’t be hit by small molecules or antibodies. Dicerna is also developing another experimental RNAi drug, called DCR-PH1, to treat a rare inherited genetic disease called primary hyperoxaluria type 1 that often leads to kidney failure. Dicerna will begin the first trial of DCR-PH1 in 2015.

Dicerna’s also looking at certain rare diseases involving genes expressed in the liver, and another well-known undruggable target, the KRAS gene, according to its prospectus.

Ben Fidler is Xconomy's Deputy Biotechnology Editor. You can e-mail him at bfidler@xconomy.com Follow @benthefidler

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