The New York-based genetic medicine company, which expects gross proceeds of approximately $100 million, joins a small group of biotechs that have launched initial public offerings this year.
Pictured: Front view of the Nasdaq building in New York/iStock, hapabapa
Lexeo Therapeutics on Thursday announced that it is putting up for sale more than nine million shares of its common stock for $11 a pop in an initial public offering, aiming to raise a total of $100 million in gross proceeds.
The New York biotech has also given underwriters a 30-day option to purchase up to a little more than 1.3 million more shares of Lexeo common stock at the IPO price, minus commissions and underwriting discounts. The company expects to close the offering on Nov. 7, but starts trading on the Nasdaq on Friday under the ticker symbol $LXEO.
Serving as joint book-running managers for the IPO are J.P. Morgan, Stifel, Leerink Partners and RBC Capital Markets. Chardan is the IPO’s lead manager.
The $100 million haul from its IPO will help Lexeo fund the development of its three main gene therapy programs, according to an SEC filing posted in September 2023, when the company first announced its Nasdaq bid. These include LX2006, the biotech’s main asset, which is being trialed in a Phase I/II study for Friedrich’s ataxia.
Lexeo is also advancing its lead Alzheimer’s disease candidate LX1001, which is likewise in Phase I/II studies, and LX2020, being assessed for arrhythmogenic cardiomyopathy. Readouts for all three programs are expected in 2024.
The biotech IPO pipeline has been relatively dry in 2023, with only some 20 public offerings filed so far. In comparison, 2022 saw 47 IPOs with a total aggregate value of approximately $4 billion, while more than 150 companies launched their offerings in 2021, making more than $25 billion in total.
The IPO frenzy in recent years was driven largely by the COVID-19 pandemic and the public debut of mRNA vaccines, which drummed up significant interest in the biomedical field. Now, amid an economic downturn and high interest rates, investors are looking to put their money behind biotechs that have demonstrated the viability of their products, preferably with mid- or late-stage evidence.
This year, only a small group of companies have met this standard. These include Acelyrin, which launched its Nasdaq bid in April 2023 and raised a total of $540 million, as well as Mineralys, which made the offer in February 2023 and collected $192 million in earnings.
Johnson & Johnson’s consumer healthcare business Kenvue, which it spun-off this year, also went public and made a historic $41 billion.
Tristan Manalac is an independent science writer based in Metro Manila, Philippines. He can be reached at tristan@tristanmanalac.com or tristan.manalac@biospace.com.
