Moderna Therapeutics, a specialist in messenger RNA-based drugs, has filed a $500m initial public offering (IPO) that would break all records for a biotech company.
It’s the latest bold move among many for Moderna under chief executive Stephane Bancel, and comes after a string of private financings in the last year that raised $625m and swelled the company’s valuation to the $7.5bn mark – even though the famously secretive biotech has released only a tiny amount of clinical data to back up its mRNA approach.
Moderna is already cash-rich, and with access to capital currently freer for biotech than it has been for years, Moderna doesn’t want to miss the opportunity for a high-return public listing.
The company is sitting on around $1.2bn, but also has a very large pipeline of 21 candidates – with 10 already in early- to mid-stage clinical testing – that is burning through its resources quickly. It’s also been spending heavily on a manufacturing facility provide drug material for its clinical programmes.
Bancel has suggested that Moderna’s reluctance to publish data on its mRNA platform is because it does not want to give ammunition to rival drug developers, although this has led some to question the high valuation for the company.
It’s notable however that the company has been able to sign up big name partners, including AstraZeneca and Merck & Co/MSD, with deals that have included both generous upfront payments and very favourable terms, including 50:50 profit sharing in some instances.
Moderna’s mRNA technology attempts to turn a patient’s own cells into drug-manufacturing factories, applying mRNA sequences to hijack cellular machinery is involved in protein production. It’s a different spin on other RNA approaches, such as RNA interference, that aim to switch off protein synthesis.
“We believe that mRNA-based medicines have the potential to help patients in ways that could equal or exceed the impact of recombinant protein-based drugs,” says the company in its IPO prospectus. It’s a bold claim, given that recombinant proteins currently account for more than $200bn in global sales.
AstraZeneca-partnered VEGF drug AZD8601 is currently heading the pipeline and is in phase 2 for heart failure, and following after are phase 1-stage vaccines for solid tumours and lymphoma, as well as vaccines for viral infections such as respiratory syncytial virus (RSV), influenza, chikungunya and Zika.