Actuate Therapeutics was already keeping its planned IPO on the modest side, but the cancer-focused biotech has now lowered those expectations even further.
The Texas- and Ireland-based company first announced in late May its intention to go public, and last week confirmed plans to offer 5.5 million shares of common stock priced somewhere between $8 and $10 apiece.
But in a Securities and Exchange Commission filing on Friday, Actuate said that while it was still anticipating it will sell its stock within that price bracket, the company is now only expecting to offer 2.7 million shares initially.
Assuming a share price of $9, this reduced offer would bring in $21.8 million—rising to $25.3 million if underwriters fully exercise their 30-day option to buy an additional 416,666 shares at the same price.
This would be less than half of the $45.1 million proceeds expected from the original plans—which, in turn, could have risen to $52 million when accounting for the previous offer underwriters 833,333 additional shares.
An injectable form of Actuate’s drug elraglusib is in a phase 2 trial for pancreatic cancer, one of the toughest targets in oncology, and proceeds from the shrunken IPO would still allow the company to complete this midstage study. However, the reduced proceeds means the company is now allocating $16 million to this program and its related expenses as opposed to the $21 million previously set out.
The biotech had also been hoping to build on an ongoing phase 1 dose-escalation trial in refractory Ewing sarcoma—a rare type of bone cancer that can affect children and younger adults—by launching a phase 2 portion. But while completing the phase 1 trial is still listed under Actuate’s plans, the phase 2 study will now be “subject to future funding.”
Two other clinical goals that will now be delayed until further cash can be found are a phase 1 dose escalation study for an oral version of elraglusib in patients with advanced, refractory solid cancer, and a phase 2 study in refractory metastatic melanoma. These programs were expected to cost a combined $9.3 million, based on last week’s SEC filing.
Elraglusib is designed to bind to GSK-3β, disrupting cancer pathways associated with the invasion of tumor cells and resistance to chemotherapeutic agents and radiation. Preclinical tests suggested the intravenous small molecule could have an impact on diseases like urothelial cancer and renal cell carcinoma, leading Actuate to take the candidate into human studies in 2018.
It’s not uncommon for companies to rethink their offering in the days before they head to the Nasdaq. Friday also saw Artiva Biotherapeutics hit the public markets with an upsized $167 million IPO that involved the natural killer cell therapy biotech slashing its share price from around $15 to $12 while boosting the total number of shares available from 10 million to 16 million.