Ventrus Biosciences CEO Russell Ellison jokes that he doesn’t know how his mother would have reacted if he told her 20 years ago what he’d be doing today. Jokes help when you work at a place like Ventrus (NASDAQ: VTUS), where the lead drug candidate may just become the first ever FDA-approved prescription product to treat hemorrhoids. Ventrus’ two other clinical candidates are difficult to describe in detail, this being a family-friendly website. But let’s just say they also address what could be delicately called “below-the-belt” disorders.
Ventrus’ Wall Street debut has been nothing to joke about, however. The New York City-based company went public at $6 a share last December, raising $17.4 million. The stock traded all the way up to $21 in the spring—making Ventrus one of the few successful biotech IPOs of the last several years—before settling into the $12-a-share range.
On July 14, Ventrus priced a secondary offering at $10 a share and managed to raise an additional $45 million. “A lot of people bet against us,” Ellison says, noting that many short traders piled in, expecting Ventrus’ stock to drop on the secondary offering. “But it was a successful deal.”
Hemorrhoids don’t appear on the top of many drug companies’ priority lists—and that’s exactly why Ellison sees an opportunity in Ventrus’ lead drug, VEN 309. The only marketed remedies for hemorrhoids are over-the-counter products like Preparation H, which merely mask the painful symptoms, Ellison says. Steroids are sometimes prescribed, but they can also be ineffective. That spells opportunity, he says. “Apart from surgery, there aren’t many options for patients,” Ellison says.
VEN 309 is a compound that limits the activity of 5-HT2A receptors, which have been implicated in the blood-vessel clotting and contraction that leads to hemorrhoids. The drug improves blood flow through those restricted vessels, which also lessens pain, itchiness, and other symptoms. Unlike most compounds … Next Page »
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