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Based in Boulder, CO, Clovis Oncology (proposed CLVS) scheduled a $130 million IPO with a market capitalization of $291 million at a price range mid-point of $14 for Wednesday, November 16, 2011. The full IPO calendar for the week of November 14 includes nine scheduled IPOs trying to raise over $1.5 billion.

SUMMARY & CONCLUSION

CLVS is biopharmaceutical company engaged in clinical trials and pre-clinical research to commercialize anti-cancer agents.

CLVS is intending to sell 45% of itself at 2.1 times book value, with no revenue,– which leaves little room for error in terms of CLVS’s clinical and pre-clinical trials. Therefore, we believe the risk in CLVS’s IPO outweighs potential gains.

Valuation Ratios

IPO Mrkt

Price /

Price /

Price /

Price /

Stock

Annualizing Sept 9 mos

Cap (mm)

Sales

Earnings

BookValue

TangibleBV

YTD

Clovis Oncology ((NASDAQ:CLVS))

$291

3.6

-28

2.1

2.1

45%

For more CLVS metrics click here

BUSINESS

CLVS is a biopharmaceutical company focused on acquiring, developing and commercializing innovative anti-cancer agents in the United States, Europe and additional international markets.

TARGETS

CLVS targets its development programs for the treatment of specific subsets of cancer populations, and seek to simultaneously develop, with partners, companion diagnostics that direct our product candidates to the patients that are most likely to benefit from their use.

PRODUCT CANDIDATES

CLVS is currently developing three product candidates for which CLVS holds global marketing rights:

The first is CO-101, a lipid-conjugated form of the anti-cancer drug gemcitabine, which is in a pivotal study in a specific patient population for the treatment of metastatic pancreatic cancer.

CLVS has partnered with Ventana Medical Systems for the development and commercialization of a companion diagnostic for the assessment of hENT1 levels, related to CO-101.

The second product candidate is CO-1686, an orally available, small molecule epidermal growth factor receptor, or EGFR, covalent inhibitor that is currently in preclinical development for the treatment of non-small cell lung cancer, or NSCLC, in patients with activating EGFR mutations, including the initial activating mutations, as well as the primary resistance mutation. CLVS has partnered with Roche Molecular Systems for development of CO-1686.

The third product candidate is T790M; and CO-338, an orally available, small molecule poly (ADP-ribose) polymerase, or PARP, inhibitor being developed for various solid tumors that is currently in a Phase I clinical trial.

USE OF PROCEEDS

CLVS expects to net $121 million from its IPO. The use of proceeds includes the following:

  • $50.0 million to fund clinical trials and other development activities related to CO-101;
  • $25.0 million to fund clinical trials and other development activities related to CO-1686;
  • $30.0 million to fund clinical trials and other development activities related to CO-338; and
  • The remainder for working capital and general corporate purposes.

CLVS believes post-IPO it will have the resources fund clinical development efforts through the following events:

  • Completion of the LEAP trial of CO-101
  • Completion of the Phase II trial of CO-101 as a second-line treatment for pancreatic cancer patients with an absence of hENT1 expression;
  • Completion of the dose ranging portion of our Phase I/II trials of CO-338 as monotherapy and in combination with chemotherapy in solid tumors; and
  • Filing of an IND and initiation of a Phase I/II trial of CO-1686 in NSCLC.
Source: IPO Preview: Clovis Oncology