Editas Raises $94.4 Million in First U.S. IPO of the Yearby and
Editas Medicine Inc., the gene-editing drugmaker backed by Bill Gates and GV, raised $94.4 million in the first U.S. initial public offering of 2016, pricing the shares at the low end of the marketed range.
The company sold 5.9 million shares for $16 apiece, according to data compiled by Bloomberg, after offering them for $16 to $18 each. Shares of Editas will begin trading Wednesday on the Nasdaq Stock Market under the symbol EDIT.
Editas, based in Cambridge, Massachusetts, will be the first company to start trading in the U.S. this year, after an absence of IPOs in January amid volatile equity markets. It will be the first off the sidelines even as market conditions continue to invite caution: U.S. stocks retreated Tuesday, with the Standard & Poor’s 500 Index dropping the most in more than two weeks amid deepening concern that global growth is weakening.
It will also be the first publicly traded company specializing in a gene-editing technique called Crispr, which works by precisely cutting out sections of DNA. In some cases, the method replaces faulty DNA with a piece of functioning DNA. Crispr has the potential to help treat genetic conditions, including some blood, autoimmune and eye disorders, with a one-time treatment.
BeiGene Ltd., a biotech company based in Beijing, also is scheduled to price its U.S. IPO Tuesday.
Editas plans to use $15 million to $20 million of the offering proceeds for preclinical studies and clinical trials of its lead program in Leber congenital amaurosis, an inherited form of progressive blindness, according to its IPO prospectus. As much as $22 million of the net proceeds will be used for preclinical studies in the company’s collaboration with Juno Therapeutics Inc., which develops cancer therapies.
Editas is planning its first clinical trial for 2017. The development-stage drug company doesn’t have revenue and doesn’t expect to generate product sales for several years, if ever, its prospectus shows.
Existing shareholders didn’t plan to sell shares in the IPO. Venture capital firms Flagship Ventures and Polaris Partners each held stakes of more than 15 percent of the company before the offering.
Editas raised $163.3 million from selling preferred stock in private offerings, filings show. Alphabet Inc.’s venture arm -- which recently shortened its name to GV from Google Ventures -- as well as Gates and Khosla Ventures are among the investors who bought private shares.
Morgan Stanley and JPMorgan Chase & Co. managed the IPO.