Regulus Therapeutics Files for IPO as ‘Emerging Growth’ Company

8/20/12Follow @bvbigelow

San Diego’s Regulus Therapeutics plans to raise $57.5 million in an IPO that takes advantage of incentives for emerging growth companies provided under the Jump Start Our Business Startups (JOBS) Act passed earlier this year.

In its IPO filing, the preclinical biopharmaceutical says it plans to follow reduced IPO disclosure and financial reporting requirements for five years, or until Regulus no longer qualifies as an emerging growth company. The company says it intend to use proceeds of the offering and a concurrent private placement to advance development of its microRNA drug candidates, capital expenditures, working capital, and other corporate purposes.

The company specializes in RNA interference, or RNAi technology, that uses snippets of ribonucleic acid, or microRNAs to block key signaling pathways linked to many diseases. The lead experimental compounds at Regulus are targeting four areas—cancer, hepatitis C, cardiovascular disease, and fibrotic disorders.

“We believe we have assembled the leading position in the microRNA field, including expertise in microRNA biology and oligonucleotide chemistry, a broad intellectual property estate, key opinion leaders and disciplined drug discovery and development processes,” the company says in its filing.

Regulus was founded in 2007 with technology, capital, and expertise provided by Carlsbad, CA-based Isis Pharmaceuticals (NASDAQ: ISIS) and Cambridge, MA-based Alnylam Pharmaceuticals (NASDAQ: ALNY). Isis holds a 45.2 percent stake in the company and Alnylam owns just over 44 percent. Regulus says it now has 56 full-time employees, including 23 with Ph.D. degrees.

The company’s says it has raised a total of $106.6 million from its founders, other investors, and through strategic drug-research partnerships with AstroZeneca, GlaxoSmithKline (GSK), and Sanofi. Under these alliances, Regulus says it could receive as much as $1.7 billion in milestone payments for successfully completing development of its microRNA products through 11 drug development programs.

The IPO filing says AstraZeneca also has agreed to buy $25 million worth of Regulus common stock in a concurrent private placement in which the share price will be equal to offering price of the Regulus IPO. Sanofi has indicated it might buy as much as $10 million in Regulus shares in a similar private placement, while Isis and GSK have each indicated an interest in buying as much as $2 million in Regulus shares. These latter deals are non-binding, however, so Sanofi, Isis, and GSK might buy invest less or not at all.

Regulus generated total revenue of nearly $13.8 million in 2011. At the end of June, the company had nearly $27 million in cash and cash equivalents and an accumulated deficit of almost $47.9 million.

The company says it intends to list its shares on the NASDAQ under the symbol RGLS.

Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at bbigelow@xconomy.com or call (619) 669-8788 Follow @bvbigelow

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  • General Anthony C. McAuliffe

    Nuts