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In Biotech, Everyone’s Going Public. What’s Your Excuse?

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“a challenging market” by withdrawing its S-1. He says an IPO isn’t off the table completely. In nine to 12 months, he expects MultiVir’s two lead programs to produce Phase 1 data, which “could be useful” in making another fundraising pitch.

MultiVir has a long history. It was once, essentially, the Austin, TX-based Introgen Therapeutics, which filed for bankruptcy in 2008 after FDA refused to review its lead product. Now, several of the same executives (Sobol was Introgen’s SVP of medical and scientific affairs) and clinical products are back.

Licensed from Introgen, MultiVir’s lead product candidates are in Phase 1—well behind the more advanced lead programs at UniQure  and Spark at the time of their IPOs. Introgen’s lead candidates, one to treat liver metastases from colon cancer, the other to treat squamous cell carcinoma of the head and neck, use adenoviral vectors to deliver their genes. It’s a delivery technology not seen often these days, but it was the basis for the first gene therapy ever approved. (It was in China.)

I asked what changes MultiVir has made to those products since buying them out of Introgen’s bankruptcy proceedings. Sobol said the agents are now being considered in combination with checkpoint inhibitors, a class of drug that blocks a tumor’s ability to hide from the immune system.

Multivir is—or was, at the time of its most recent filing—nearly wholly owned by one entity, Pope Investments of Memphis, TN, which bills itself as an investment manager for high-net-worth investors.

Compare that to the gene therapy developers that have gone public, plus others—Voyager Therapeutics, Audentes, GeneSight Biologics, RegenXbio, and Dimension Therapeutics, for example—which have all attracted high profile VCs, crossovers, and sometimes both.

MultiVir is looking to cancer immunotherapy to put Introgen’s technology, products, and people in a new light. So far, that light has only attracted a single investor.

CardioDx. Diagnostics companies haven’t enjoyed the IPO boom as much as drug companies, but now and then a diagnostics firm has notched a public listing. CardioDx isn’t one of them, but not for lack of trying.

It first filed its intentions in 2013, but by the end of that year, it had pulled back. In late April 2014 it reanimated its attempt, then officially withdrew in late December.

The company has a commercial product and an all-star board of directors that includes former Boston Scientific CEO Jim Tobin, Brook Byers of Kleiner Perkins Caufield & Byers, who has helped take several diagnostics firms public, and cardiologist/entrepreneur Louis Lange.

The company’s CORUS CAD genetic test helps doctors rule out obstructive coronary artery disease when a patient comes in with chest pain. CardioDx claims 90 percent of all such patients don’t have a heart problem, and the test can help avoid a range of unnecessary procedures, including invasive cardiac catheterization.

The test received Medicare Part B coverage in mid-2012 and by the end of 2013 had generated $8 million in revenue. Two private insurers have since signed on, but more recent revenue numbers weren’t available. (The company did not respond to requests for comment.)

With more than $200 million in private capital raised, it would be safe to assume the investors were clamoring for an exit. Still, late last year, when the company withdrew its IPO try, it played down the importance of the would-be offering: “The terms currently obtainable in the public marketplace are not sufficiently attractive to the Registrant to warrant proceeding with the public offering,” the notice read.

It added that the IPO would have been strictly a “discretionary” financing—a comment meant to signal the company was by no means desperate for the cash.

At the same time, the firm announced a $35 million private round of financing. So make that at least $235 million in private funding, and counting. Those are numbers that would make most investor syndicates shudder, although Juno Therapeutics (NASDAQ: JUNO) made the big-box financing strategy (one year, two rounds, $310 million) look brilliant, and some of Juno’s backers are trying it again with Denali Therapeutics.

Other than those rare deliberate efforts to raise mountains of capital, we haven’t seen many totals like that in recent years, with so many biotechs able to convert less than nine digits of investment into a public debut. In the end, though, going public can salve a lot of wounds, or at least shift the financial risk to a new set of bettors. For a handful of biotechs, however, that day has yet to come.

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