U.S. IPO Weekly Recap: Biggest Biotech Breaks In 3-IPO Week

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Includes: ARDT, DMAC, MOGU-OLD, MRNA, THOR
by: Renaissance Capital IPO Research

Moderna (NASDAQ:MRNA) was not the cure for the biotech industry, which has broadly sold off this quarter.

Moderna upsized its offering to raise $604 million at a record-shattering $8.1 billion valuation. It is the largest biotech IPO by both deal size and proceeds raised. It also had one of the year's worst first-day returns, tumbling -19%, from $23.00 to $18.60. While Moderna's potential is massive, no mRNA therapies have been approved, it has a steep cash burn, and it is still in the early stages of drug approval. As we noted in our Pre-IPO report, Moderna was valued by VCs at $10.06 as recently as February.

Synthorx (NASDAQ:THOR) was the week's bright spot, gaining 15% on Friday after pricing an upsized IPO at the midpoint. Backed by Avalon Ventures and RA Capital, the company is developing a breakthrough cancer therapy, but has not tested its drug in humans. Over half of the deal was indicated on by insiders.

Chinese fashion site MOGU (MOGU-OLD) priced at the low end to raise $67 million at a $1.6 billion valuation. The stock opened with a 14% loss on Thursday, climbed back up to its offer price by end-of-day, and then sunk 4% on Friday. Investors may have been skeptical of MOGU's plan to restart growth after sales declined in its most recent fiscal year.

DiaMedica Therapeutics (DMAC) also priced a $16 million IPO uplisting; with a market cap below $50 million, however, we are not counting it in our IPO stats.

3 IPOs During the Week of December 3rd, 2018

Issuer
Business

Deal
Size

Market Cap
at IPO

Price vs.
Midpoint

First Day
Return

Return
at 12/07

Synthorx

$131M

$355M

0%

+15%

+15%

Preclinical biotech developing immunotherapies for solid tumors.

MOGU

$67M

$1,579M

-7%

n/a

-4%

Tencent-backed online fashion marketplace in China.

Moderna

$604M

$8,120M

0%

-19%

-19%

Early-stage biotech developing therapies based on its modified mRNA platform.

1 Filing During the Week of December 3rd, 2018

Issuer
Business

Deal
Size

Sector

Lead
Underwriter

Ardent Health (ARDT)

$400M

Health Care

Barclays

LBO'd operator of 31 acute care hospitals.

IPO Market Snapshot

The Renaissance IPO Indices are market cap weighted baskets of newly public companies. As of 12/6/18, the Renaissance IPO Index was down 8% year-to-date, while the S&P 500 had a gain of 3%. Renaissance Capital's IPO ETF (NYSE: IPO) tracks the index, and top ETF holdings include VICI Properties (OTC:VICI) and Spotify (NYSE:SPOT). The Renaissance International IPO Index was down 17% year-to-date, while the ACWX was down 12%. Renaissance Capital's International IPO ETF (NYSE: IPOS) tracks the index, and top ETF holdings include innogy and Siemens Healthineers.