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Based in Louisville, CO, GlobeImmune (NASDAQ:GBIM) scheduled a $60 million IPO with a market capitalization of $206 million at a price range mid-point of $12 for Thursday, September 20, 2012.

Seven IPOs are scheduled for the week of September 17. Full IPO calendar available here.

GBIM S-1 filed September 5, 2012.

Manager / Joint Managers: Wells Fargo Securities/ Piper Jaffray

Co Managers: JMP Securities/ Needham/ MLV & Co.

SUMMARY

  • GBIM is a biopharmaceutical company focused on developing therapeutic products for cancer and infectious diseases based on a proprietary Tarmogen platform.
  • GBIM has received $40 million in upfront fees since 2009: $30 million from Celgene (NASDAQ:CELG) and $10 million from Gilead (NASDAQ:GILD). As of June 2012 GBIM has recognized $19.3 million of the upfront money received from strategic partners.
  • Tarmogen activates the immune system by stimulating a subset of white blood cells called T-cells that destroy infected or malignant cells in contrast to traditional vaccines, which predominately stimulate antibody production.

CONCLUSION

Normally, biopharma companies are deemed very risky on their IPOs, pending successful completion of stage 3 clinical trials.

However, if you as an investor are attracted to biopharma companies, then GBIM is worth considering, especially because GBIM has obtained significant monies from two strategic partners. If stage 3 clinical trials are successful, then the stock will appreciate significantly (customary for biopharma stocks).

IPOdesktop's conclusion is to take a small position in GBIM with the intention of holding it for 12 months or so, if you like biopharma stocks.

BUSINESS

GBIM is a biopharmaceutical company focused on developing therapeutic products for cancer and infectious diseases based on a proprietary Tarmogen platform.

Tarmogen activates the immune system by stimulating a subset of white blood cells called T-cells that destroy infected or malignant cells in contrast to traditional vaccines, which predominately stimulate antibody production.

GBIM has four Tarmogen product candidates in five ongoing clinical trials.

The lead cancer product candidate, GI-4000, is being evaluated in combination with gemcitabine in a fully-enrolled, placebo-controlled Phase 2b trial in resected pancreas cancer.

The lead infectious disease product candidate, GI-5005, has completed a randomized, active-control Phase 2b trial in chronic hepatitis C virus, or HCV, infection.

Collaborations with biopharmaceutical companies and research institutions have allowed GBIM to advance the development of the Tarmogen product candidates while managing GBIM's own investment in these product candidates.

GBIM has two strategic collaborations, one with Celgene Corporation for all oncology product candidates and one with Gilead Sciences, Inc. for chronic hepatitis B virus, or HBV, infection. GBIM currently has no products approved for commercial sale.

REVENUE SOURCES

Celgene

In May 2009, in connection with GBIM's collaboration with Celgene, GBIM received a non-refundable, upfront payment of $30.0 million. GBIM were initially recognized the upfront payment over 7.3 years, the estimated term of performance under the collaboration, commencing at the time of execution of the agreement in May 2009.

GBIM subsequently adjusted the estimated term to 8.1 years in June 2011 due to a revised estimate of the time of completion of performance.

Gilead

In November 2011, GBIM received a non-refundable, upfront payment of $10.0 million in connection with a collaboration with Gilead. GBIM is recognizing the initial consideration of $10.0 million and the additional $5.3 million GBIM will receive as reimbursement from Gilead of costs to perform the initial Phase 1a trial on a proportional performance basis over the substantive period of performance to complete the preclinical development, which is estimated to be from October 2011 through 2020.

MANUFACTURING

GBIM commissioned a 22,000 square foot facility in 2006 in Louisville, Colorado that incorporates current Good Manufacturing Practices, or cGMP, for the manufacture of clinical supplies of product candidates.

GBIM invested $10.9 million since late 2005 in the facility to support both small-scale early clinical production and commercial-scale production for a pivotal trial and inventory build for potential product launch. GBIM's small-scale production process is in routine operation.

The Tarmogen manufacturing process yields an off-the-shelf vialed product candidate with multi-year stability that can be distributed through conventional pharmaceutical channels.

INTELLECTUAL PROPERTY

Tarmogen

The Tarmogen technology platform is covered by eight families of patents and patent applications of which nine are issued U.S. patents and 23 are issued foreign patents in Australia, Canada, China, Hong Kong, Japan, Singapore, South Korea and multiple European countries, and of which 58 are patent applications in the U.S. and foreign jurisdictions, providing protection in the United States and foreign jurisdictions for the basic Tarmogen platform, as well as various improvements and modifications to the Tarmogen platform, technology and manufacturing processes.

These eight patent families are owned and/or co-owned by GBIM and/or exclusively licensed from The Regents of the University of Colorado or The United States of America as represented by the Department of Health and Human Services, or HHS.

In addition to the protection provided by the existing patent families that GBIM currently owns, co-owns and/or licenses, under the exclusive, worldwide license from The Regents of the University of Colorado which provides intellectual property rights related to the Tarmogen platform including various improvements and specific technologies related to the Tarmogen platform that have been or may be discovered in the future by University of Colorado researchers during the term of the license.

GI-4000

The lead oncology product candidate, GI-4000, targeting cancers expressing mutated Ras, is specifically covered under two patent families that GBIM currently owns and/or co-owns and/or licenses under an exclusive, worldwide license from The Regents of the University of Colorado, of which five are issued U.S. patents and five are issued foreign patents in Australia, China, Hong Kong, South Korea and Japan, and of which 26 are patent applications in the U.S. and foreign jurisdiction.

COMPETITION

Competing Immunotherapy Technologies

There are numerous immunotherapy products in clinical development, with over 215 targeting cancer, over 90 targeting infectious diseases and over 90 targeting chronic and other conditions. These products are generally based on one of several different competing platform technologies.

There is only one FDA-approved therapeutic vaccine, Dendreon Corporation's (NASDAQ:DNDN) sipuleucel-T, active cellular immunotherapy for the treatment of asymptomatic or minimally symptomatic metastatic castrate resistant hormone refractory prostate cancer.

GI-4000

GI-4000 is the only late-stage product candidate targeting Ras mutated cancer.

There are numerous marketed therapeutics indicated for NSCLC, including Roche Holding AG's (RHHBY,OB) bevacizumab, Eli Lilly's (NYSE:LLY) pemetrexed, Astellas Pharma's (OTCPK:ALPMF) erlotinib and AstraZeneca PLC's (NYSE:AZN) gefitinib, as well as generically available gemcitabine, platinum-based chemotherapeutics (cisplatin, oxaliplatin and carboplatin) and mitotic inhibitors (paclitaxel and vinorelbine), which are marketed by several generic pharmaceutical firms.

There are numerous marketed therapeutics indicated for colorectal cancer, including Roche Holding AG's bevacizumab, Bristol Myers-Squibb's (NYSE:BMY) cetuximab, and Amgen's panitumumab, as well as irinotecan, oxaliplatin, leucovorin and 5-FU, which are marketed by several generic pharmaceutical firms.

GI-6207

In April 2011, AstraZeneca's vandetanib was the first FDA-approved treatment for late-stage, or metastatic, MTC in adult patients who are ineligible for resection.

GI-6301

GBIM believes there are no approved products targeting brachyury, and no immunotherapy products in clinical development targeting brachyury other than GI-6301.

GI-5005

There are several marketed therapeutics indicated for the treatment of chronic HCV infection, including Roche Holding AG's pegylated interferon 2a, Merck's (NYSE:MRK) pegylated interferon 2b and boceprevir, Vertex's (NASDAQ:VRTX) telaprevir, and ribavirin, which is marketed by several generic pharmaceutical firms.

GI-13000

There are several marketed therapeutics indicated for the treatment of chronic HBV infection, including Roche Holding AG's pegylated interferon 2a, Gilead's tenofovir and adefovir, Bristol Myers-Squibb's entecavir, Novartis' (NYSE:NVS) telbivudine, and lamivudine, which is marketed by several generic pharmaceutical firms.

USE OF PROCEEDS

GBIN expects to net $54 million from its IPO. Proceeds are allocated as follows:

  • $12 million to advance one of preclinical infectious disease product candidates through a Phase II clinical trial;
  • $10 million to fund the external costs of the initial Phase 2 portion of planned Phase II/III clinical trial for GI-4000 in pancreas cancer;
  • $3 million to prepare manufacturing facility and process for commercial-scale production of Tarmogens;
  • $1 million to support external costs of manufacturing for our trials for GI-4000, GI-6207 and GI-6301; and
  • Remainder for working capital and other general corporate purposes.
Source: IPO Preview: GlobeImmune