67.4 F
San Diego
Sunday, Jul 21, 2024

Pfenex Seeking $74.8M in Initial Public Offering

Pfenex Inc., a spinoff of Dow Chemical Co., is the latest San Diego biotech to file for an initial public offering. The company is looking to raise $74.8 million as it focuses development on a growing class of drugs called biosimilars, which are projected to make a large dent in big pharma sales as patents for biologic drugs expire.

Pfenex, which employs 25 people and was founded in 2009, plans to list on the New York Stock Exchange under ticker symbol PFNX. Pricing terms for the IPO have not been determined.

While the company has an array of drugs in development, the lion’s share of the IPO’s proceeds will go toward developing its line of biosimilars, which essentially are the generic versions of a class of drugs called biologics. These are medicines derived from biological — as opposed to chemical — sources, using things like genetically engineered viruses to work as medication. They are a newer class of drugs, and the majority of big pharma patents are in place currently. However, these will expire over the next decade, opening the market for competitors like Pfenex.

The 2012 global biologics market represented more than $160 billion in sales, according to the IMS Institute for Healthcare Informatics, an international market intelligence organization. The market for global biosimilars grew to $2.4 billion in 2012, according to IMS data.

Pfenex expects the biologics market to adopt biosimilars in coming years, much as generic drugs entered the market several decades ago and now account for 80 percent of all medications prescribed in the U.S., the company said in its prospectus.

“Currently, few biologics are off-patent,” Pfenex’s registration statement said, but it added that in 2015, products that accounted for an estimated $24 billion in aggregate sales during 2013 will lose patent protection worldwide.

“This number will increase every year as several large-market biologic products lose patent protection,” the prospectus continued.

By 2020, Pfenex estimates, about $45 billion of 2010 product sales will have come into play globally, representing 47 products for which intellectual property rights will have expired.

Drug Candidates in the Pipeline

Pfenex’s biosimilars resemble macular degeneration drug Lucentis, which is marketed by F. Hoffman-La Roche Ltd. and Novartis AG and achieved 2013 sales of about $4.3 billion.

Pfenex’s technology for protein production, which it calls Pfenex Expression Technology, was developed initially by Mycogen Corp., which was acquired in 1998 by Dow Chemical’s agribusiness unit. The chemical giant in 2009 spun out Pfenex, which has developed a platform that can quickly, accurately and inexpensively develop proteins for biopharmaceutical uses.

Pfenex is conducting Phase 1b/2a trials of its drug candidate, PF582, in patients with wet age-related macular degeneration, a disease of the eye that causes loss of vision. It expects to enter phase 3 trials in mid-2015.

The company’s next most advanced product candidate, PF530, is similar to Bayer AG’s Betaseron, which treats multiple sclerosis. Sales of Betaseron topped $1.4 billion in 2013 globally.

Pfenex booked $11 million in collaborative revenue for the 12 months ended March 31, according to the company’s registration statement. It initially filed for the IPO confidentially with the U.S. Securities and Exchange Commission on May 5. It lists New York City-based Signet Healthcare Partners, a venture capital firm focused on health care, as an investor on Pfenex’s website.

Pfenex has five other biosimilar candidates in development. It is also developing a vaccine for anthrax, for which it has received a $23.9 million, multiyear contract with the U.S. Department of Health and Human Services. It is also subcontracting with Reston, Virginia-based defense contractor Leidos Holdings Inc. to develop an anti-malarial drug.


Featured Articles


Related Articles