Kyverna Therapeutics Inc shares rose as much as 59 percent in early trading on Thursday after its expanded US initial public offering (IPO) raised US$319 million, as drug developers continue to receive a warm welcome from new investors.
Emeryville, California-based Kyverna’s shares gave back some of those gains to end the session at US$30 each in New York, 36 percent above the IPO price of US$22.
At that price, the Bain Capital LP-backed biotechnology company has a market value of about US$1.2 billion.
Photo: Reuters
The opening surge was the biggest for a company raising more than US$100 million in an IPO since Cava Group Inc’s US$365 million debut in June last year, according to data compiled by Bloomberg.
Kyverna had a tough time deciding who to allocate shares to given “very large mutual funds were willing to come into the story and wanted to be part of” the deal, chief executive officer Peter Maag said in an interview. The IPO was about “20-times oversubscribed,” he said.
“This is a tremendous outcome for the organization as it gives us the capital to execute our clinical trial program,” Maag said.
The funds are expected to provide a runway into 2026 and set it up for potential pivotal trials, he said.
The strong results continue a streak of therapeutics companies drawing heightened investor demand.
The offering is the second-largest for a drug developer this year, after cancer-focused CG Oncology Inc raised US$437 million two weeks ago, according to data compiled by Bloomberg. Its shares have more than doubled since its debut.
Kyverna’s lead medicine is a CAR T-cell therapy for autoimmune diseases in rheumatology and neurology. Bain Capital, Gilead Sciences Inc, Vida Ventures LLC and Westlake BioPartners LLC are among Kyverna’s largest investors, according to the company’s filings with the US Securities and Exchange Commission.
Kyverna is part of a busy week for US IPOs that includes American Healthcare REIT Inc, which raised US$672 million and is up nearly 10 percent, and a Mexican grocery chain. Also in biotech, Moderna Inc-backed Metagenomi Inc’s offering was slated to price later on Thursday.
HSBC Innovation Banking managing director Jonathan Norris expects about 25 venture capital-backed biotech IPOs in the US and Europe this year.
There will be “more later-stage than earlier companies with a focus on drugs that have opportunities for catalysts in the near-term,” Norris said.
Drug developers have been actively raising cash through sales of new shares to public investors this year.
The industry has raised nearly US$5 billion via follow-on offerings, data compiled by Bloomberg showed, more than double the amount seen through Feb. 7 last year.
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