We may have a data set of four, but the it looks like the biotech IPO is here to stay. ORIC Pharmaceuticals is the latest biotech to go public since the World Health Organization declared COVID-19 a pandemic. The cancer biotech priced its IPO at the top end of its range, raking in $120 million and eclipsing its $86 million goal.
ORIC, which stands for overcoming resistance in cancer, is working on a pipeline of drugs designed to do just that. The IPO proceeds, along with its previous funding rounds, will push its lead program through phase 1b and into phase 2 and move its second program into the clinic.
The company’s lead program, ORIC-101, targets the glucocorticoid receptor, which has been linked to resistance to multiple types of cancer treatments in several kinds of solid tumors. It is in a phase 1b study testing it in combination with various cancer meds. These include the chemo drug Abraxane or a checkpoint inhibitor in solid tumors and an androgen receptor modulator in prostate cancer.
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ORIC’s second program, ORIC-533, is a small-molecule inhibitor of CD73, part of a pathway implicated in cancer resistance to chemotherapy and immunotherapy, the company said in a securities filing. It plans to file an IND for the candidate in 2021.
When we caught up with Nasdaq earlier this month, Jordan Saxe, its head of healthcare listings, cautioned against extrapolating from a "data set of two." At the time, only Imara, which is working on treatments for sickle cell disease, and cancer biotech Zentalis Pharma had pulled off IPOs since COVID-19 officially became a pandemic. Now, ORIC and Keros Therapeutics, a company focused on blood and musculoskeletal disorders, have joined the mix.
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The long-term nature of drug development is one factor that has seemingly inoculated biotech from pandemic-related market volatility—even as the spring IPO market has “shut down” for other industries.
“It’s the life cycle of how drugs get brought to market and it is irrespective of what’s happening in the market on a month-to-month basis,” Saxe said. Their investors “are not focused on a quarter-to-quarter metric; they’re looking at an average milestone readout that is at least 12 months from the IPO.”
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But just being a biotech company doesn’t mean an automatic IPO. It will be easier for companies that are “pretty far along in the process” and have spent time meeting with investors to manage a virtual roadshow and a virtual IPO.
“I don’t think every biotech will have that opportunity,” Saxe said.