In a move that will be seized on as a sign that the IPO window is reopening in 2023, CG Oncology has not only become the first biotech to go public this year but overshot its own estimates.
The bladder cancer-focused company had been hoping to price its shares in the range of $16 to $18. But the biotech revealed yesterday that it had managed to sell the stock for $19 apiece.
It means that CG Oncology is in line for $380 million from the offering—before various expenses are deducted—well above the $181 million it had been anticipating had the share price fallen in the middle of its expected range.
The biotech could yet rake in more money from the IPO, should underwriters take up their 30-day option to purchase a further 3 million shares. At the upsized share price, that would bring in another $57 million.
Even before that, the $380 million haul puts CG Oncology at the very top end of the IPO scale when judged by 2023 standards. In fact, the only biotech to exceed that level last year was immunology-focused Acelyrin, which brought in $540 million back in May. The next largest IPO of that year was Apogee Therapeutics, which only managed $345 million once the underwriters’ additional purchases were taken into account.
CG Oncology’s stock is set to begin trading on the Nasdaq this morning under the ticker “CGON,” with the offering closing on Jan. 29.
The company’s success will be viewed as an early sign that predictions of the IPO window reopening in 2023 are coming to pass. Coming up behind CG Oncology are a series of other biotechs that have also unveiled their intention to go public this year—including Alto Neuroscience, gene-editing company Metagenomi, Arrivent Biopharma, and CAR-T developer Kyverna Therapeutics.
California-based CG is focused on developing cretostimogene grenadenorepvec, an oncolytic adenovirus encoding immunohematopoietic cytokine granulocyte-macrophage colony-stimulating factor (GM-CSF).
The candidate is designed to infect and replicate in tumor cells, directly killing them while also causing the release of tumor-derived antigens and GM-CSF to stimulate an immune attack. CG has initially been developing the candidate as a treatment for non-muscle invasive bladder cancer.
Despite a tepid IPO market last year, CG made no secret of its ambition to go public as far back as August. The company was one of the few that opted for a pre-IPO crossover funding round last year, a financing model that proved popular during the biotech boom years.