Harvard-linked Sana brought in nearly four times as much in proceeds as originally planned and saw shares surge 40% on the first day of trading.
Sana Biotechnology, a US-based stem cell medicines developer exploiting Harvard University research, priced shares above its range at $25 on Wednesday to raise almost $588m in an upsized initial public offering.
The company issued 23.5 million shares, up from a planned 15 million, and began trading on the Nasdaq Global Select Market under the symbol SANA yesterday. Its price range was set at $20 to $23 last week to raise up to $397m, already more than double its original target of $150m.
Shares surged by 40% on the first day of trading and closed at $35.10, giving Sana a market cap of approximately $6.4bn.
It is the largest IPO for a preclinical biotech company yet, according to Axios, and comes just over two years after Harvard celebrated the $604m initial public offering of messenger RNA (mRNA) therapeutics developer Moderna.
Founded in 2018, Sana is developing cell therapies that are capable of evading the body’s own immune system, thereby avoiding undesired immune responses. In addition to Harvard research, it also commercialising work conducted at University of California, San Francisco and University of Washington.
It was launched by former executives of Juno Therapeutics, an immunotherapy spinout of Fred Hutchinson Cancer Research Centre, Seattle Children’s Research Institute and Memorial Sloan-Kettering Cancer Centre that went public in 2015 before being acquired by Celgene – itself now a subsidiary of pharmaceutical firm Bristol Myers Squibb – for $9bn in 2018.
The listing follows $700m in funding announced in June 2020, split across four transactions featuring internet technology group Alphabet’s GV unit, Arch Venture Partners, Flagship Pioneering, Canada Pension Plan Investment Board (CPP), Fidelity’s F-Prime Capital.
Sana CEO Steve Harr, chairman Hans Bishop and general counsel James MacDonald are also all investors in the company, as are Baillie Gifford, Alaska Permanent Fund, the Public Sector Pension Investment Board, Bezos Expeditions, Omega Funds, Altitude Life Science Ventures and Abu Dhabi Investment Authority.
Spinout-focused investment firm Osage University Partners also lists the company in its portfolio, although Osage is not named in the prospectus and it is unclear when it invested.
Sana will put $190m of the IPO proceeds towards the continued development of its in vivo cell engineering platform and related candidates, another $190m towards its ex vivo cell engineering platform and related assets, and $80m towards its manufacturing capabilities.
It has also allocated $40m to research and development activities.
Arch’s stake has been diluted from 27.5% to 24% post-IPO, followed by Flagship (which now owns 18.6%), CPP (5.1%), Harr (4.9%) and F-Prime (4.5%).
Morgan Stanley, Goldman Sachs, JP Morgan and BofA Securities are the joint book-running managers for the offering. They have been granted a 30-day option to purchase up to an additional 3.5 million shares which, if exercised in full, would boost proceeds to almost $676m.
