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Based in Cambridge, MA, Radius Health (RDUS) scheduled a $62 million IPO with a market capitalization of $285 million at a price range mid-point of $9.50, for Thursday, November 8, 2012.

Five IPOs are scheduled for this week. The full IPO calendar is available here.

Update: rescheduled for 11/5 wk

S-1 filed October 19, 2012.

Manager, Joint Managers: UBS Investment Bank; Leerink Swann

Co Managers: Cowen; Lazard Capital Markets

SUMMARY

RDUS is a venture-funded biopharmaceutical company with no major partners.

IPO proceeds are allocated to further fund Phase 3 clinical trials.

CONCLUSION

RDUS is a small IPO with no major partner, but it does have good prospects. IPOdesktop believes it is prudent to pass on the RDUS IPO but wish them good luck.

Valuation Ratios

IPO Mrkt

Price /

Price /

Price /

Price /

% offered

annualizing June '12 6 mos

Cap (MM)

Sales

Earnings

BookValue

TangibleBV

in IPO

Radius Health

$285

none

-6

4.5

4.5

22%

Glossary of IPO Analysis terms

BUSINESS

RDUS is a biopharmaceutical company focused on developing new therapeutics for the treatment of osteoporosis and other women's health conditions.

Three product candidates are in development, the most advanced of which is BA058. RDUS began dosing subjects in a pivotal Phase 3 clinical study of BA058-SC for the prevention of fractures in women suffering from osteoporosis.

RDUS is also developing BA058-TD, a short wear time, transdermal form of BA058 that is based on a microneedle technology from 3M, which has completed a Phase 1b clinical study. RDUS believes that BA058-TD may eliminate the need for injections and lead to better treatment compliance for patients.

RDUS's second clinical-stage product candidate is RAD1901, which has completed an initial Phase 2a clinical study for the treatment of vasomotor symptoms, commonly known as hot flashes, in women entering menopause.

RDUS's third product candidate, RAD140, is in preclinical development and is a potential treatment for age-related muscle loss, frailty, weight loss associated with cancer cachexia and osteoporosis.

FDA

The FDA may change its approval policies or adopt new regulations. For example, on February 15, 2012, RDUS received a letter from the FDA stating that, after internal consideration, the agency believes that a minimum of 24-month fracture data are necessary for approval of new products for the treatment of postmenopausal osteoporosis - and RDUS's ongoing BA058-SC pivotal Phase 3 clinical study is designed to produce fracture data based on an 18-month primary endpoint.

Based on discussions with the agency, RDUS believes that continued use of the 18-month primary endpoint will be acceptable, provided that RDUS's NDA (New Drug Application) includes the 24-month fracture data derived from a 6-month extension of the BA058 80 µg and placebo groups in RDUS's Phase 3 clinical study that will receive daily or weekly oral doses of alendronate (generic Fosamax®) or other standard of care for osteoporosis management.

RDUS plans to file the NDA with the 18-month fracture data and supplementally provide the 24-month fracture data, when available. RDUS cannot be certain that the FDA will not change this approval policy again, or adopt other approval policies or regulations that adversely affect any NDA that RDUS may submit.

VENTURE FUNDED

5% stockholders pre-IPO

Entities affiliated with MPM Capital, 38.8%

The Wellcome Trust Limited, as trustee of The Wellcome Trust, 13.3%

HealthCare Ventures VII, L.P., 10.6%

BB Biotech Ventures II, L.P., 8.8%

Entities affiliated with Saints Capital, 8.6%

Entities affiliated with Oxford Bioscience Partners, 6.3%

Brookside Capital Partners Fund, L.P., 5.7%

Biotech Growth N.V., 5.7%

INTELLECTUAL PROPERTY

Patents relating to BA058

Composition of matter of BA058 is claimed in the United States (U.S. Patent No. 5,969,095), Europe, Australia, Canada, China, Hong Kong, South Korea, New Zealand, Poland, Russia, Singapore, Mexico, Hungary, and Taiwan.

These cases have a normal patent expiration date of 2016 absent the possibility of patent term extension. The Phase 3 clinical dosage of BA058 by the subcutaneous route for use in treating osteoporosis is covered by Patent No. 7,803,770 until 2028 (statutory term extended with 175 days of patent term adjustment due to delays in patent prosecution by the USPTO) in the United States (absent any patent term extension under the Hatch-Waxman Act).

The intended therapeutic formulation for BA058-SC is covered by Patent No. 8,148,333 until 2027 (statutory term extended with 36 days of patent term adjustment due to delays in patent prosecution by the USPTO) in the United States (absent any patent term extension under the Hatch-Waxman Act).

Related cases granted in China, Australia, Singapore, and Ukraine, and currently pending in Europe, China, Australia, Canada, Japan, Brazil, Mexico, Singapore, South Korea, India, Israel, New Zealand, Norway, Russia, and Hong Kong will have a normal un-extended patent expiration date of 2027.

An international patent application and a corresponding U.S. patent application were filed in 2012 (claiming priority to 2011) which cover various aspects of BA058 for microneedle application. Any claims that might issue from these applications will have a normal expiration date no earlier than 2032.

COMPETITION

Competition for BA058

Potential competitors with BA058 include, but are not limited to, Amgen (AMGN), UCB, Merck (MRK), Novartis (NVS), Lilly (LLY), Asahi Kasei and Zosano. Lilly launched Forteo in December 2002 as the first-to-market anabolic or bone-building agent for the treatment of osteoporosis. In April 2012, UCB and Amgen started a Phase 3 clinical trial program for their sclerostin antibody for the treatment of osteoporosis. Zosano and Asahi Kasei are also developing a transdermal form of rhPTH(1-34) that would compete with BA058-TD. We have no products approved for sale and therefore have no share of any therapeutic markets in which we hope to introduce BA058.

USE OF PROCEEDS

RDUS expects to net $56 million from its IPO.

Proceeds are allocated to fund the clinical development of RDUS's most advanced product candidates and for other general corporate purposes.

Source: IPO Preview: Radius Health