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IPO Report: Prosensa Holding B.V.

By  +Follow June 27, 2013 11:50AM
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Based in Leiden, NL, Prosensa Holding B.V. (RNA) scheduled a $60 million IPO with a market capitalization of $408 million, at a price range mid-point of $12 for Friday, June 28, 2013.

  • F1-A filed June 18, 2013
  • Manager, Joint Managers: J.P. Morgan; Citi
  • Co-Managers: Leerink Swann; Wedbush PacGrow; KBC Securities; Trout Capital

Summary

RNA is working on a medical solution to Duchenne muscular dystrophy (DMD), a genetic disease. DMD occurs mostly in boys. Symptoms typically appear between ages 1-4 years old.

The results of clinical trials may indicate that drisapersen may lead to stabilization of the disease. But stabilization is not a molecular cure, which is what some of the recent stem cell IPOs seem to offer as a possiblity.

Another company, PTCT, focuses on a different subset of DMD and was up 10% on its IPO on Thursday, June 20, 2013.

RNA reports in Eurodollars, so to do any financial analysis in the U.S. dollars it's necessary to convert to dollars.

Collaboration

100% of revenue comes from licensing and collaboration agreements with GlaxoSmithKline (GSK), and RNA works closely with Leiden University Medical Center (LUMC)

Valuation

Post-IPO RNA will have $107 million in cash. The ratio of cash to market capitalization will be 26%, at the price point mid-point of $12. RNA's accumulated deficit is $56 million.

Valuation Ratios

IPO Mrkt

Price /

Price /

Price /

Price /

% offered

annualizing Q1 '13

Cap (MM)

Sls

Erngs

BkVlue

TanBV

in IPO

Prosensa Holding B.V. (RNS)

$408

31.9

-22.2

5.4

5.9

15%

Glossary

Conclusion

Relative to price-to-book ratios, RNA is priced at about double PTCT, which IPO'd June 20. Although some IPO watchers believe RNA will go up on the IPO, it seems product to avoid RNA based on the comparison with PTCT.

To put the above conclusions and observations in context, the following is reorganized, edited and summarized from the full S-1 referenced earlier:

Business

RNA is a biotechnology company engaged in the discovery and development of ribonucleic acid-modulating, or RNA-modulating, therapeutics for the treatment of genetic disorders.

RNA's primary focus is on rare neuromuscular and neurodegenerative disorders with a large unmet medical need, including Duchenne muscular dystrophy, myotonic dystrophy and Huntington's disease.

RNA"s clinical portfolio of RNA-based product candidates is focused on the treatment of Duchenne muscular dystrophy, or DMD. Each of RNA's DMD compounds has been granted orphan drug status in the United States and the European Union.

About DMD

RNA is working on a medical solution to Duchenne muscular dystrophy , a genetic disease. DMD occurs mostly in boys. Symptoms typically appear between ages 1-4 years old. The main sign of DMD is muscle weakness that worsens over time. Before age five, the muscles in the legs, arms, and trunk begin to weaken. Later in the disease the heart and respiratory muscles weaken.

DMD is a progressive, serious disease and is caused by a genetic mutation. The mutation causes the gene to make inadequate amounts of a protein called dystrophin. This protein is needed to keep muscles intact.

Collaboration with GlaxoSmithKline

In 2009, RNA entered into an exclusive worldwide collaboration with GSK for the development and commercialization of RNA-based therapeutics for DMD, with GSK exclusively licensing worldwide rights to develop and commercialize drisapersen and obtaining an option to exclusively license PRO044.

In addition, GSK has the option to exclusively license either PRO045 or PRO053 and the further option to exclusively license either PRO052 or PRO055. PRO045 is paired with PRO053, and PRO052 is paired with PRO055, because each product candidate in the respective pairings addresses a similar-sized patient sub-population and is at a comparable stage of development.

RNA will retain the full rights to the product candidates that are not licensed by GSK, and for each product candidate licensed by GSK from each of the pairings of product candidates described above, RNA will retain the option to certain commercial rights in a selected European territory. All of other DMD compounds fall outside of the scope of the agreement, and RNA intends to develop and commercialize them or consider partnerships.

GSK financial terms

Upon entering into the agreement with GSK, RNA received a $23 million nonrefundable upfront payment from GSK and RNA has received $63.5 million in total under the agreement. Including amounts already paid, RNA is eligible for up to $677 million in total milestone payments under the agreement.

RNA is also entitled to receive percentage royalties in the low teens on future global sales of drisapersen and each of the other compounds that GSK licenses and successfully commercializes.

More about DMD

DMD is one of the most prevalent rare genetic diseases globally affecting up to 1 in 3,500 boys and is invariably fatal. There is currently no approved disease-modifying therapy for DMD. The progressive muscle-wasting that characterizes this disease is caused by inadequate production of dystrophin, a protein necessary for muscle function, as a result of mutations in the dystrophin gene. The different mutations, which are mostly deletions of one or more exons, found in the dystrophin gene result in distinct sub-populations of DMD patients.

RMA is designing product candidates to address several sub-populations using RNA's platform technology. The first product candidate, drisapersen, can address a variety of mutations in the dystrophin gene, such as a deletion of exon 50 or exons 48 to 50.

RNA financing

Since 2002, RNA raised $75.6 million from private placements of equity securities, including to a number of venture capital firms. In addition, RNA has received grants and loans from several DMD-focused patient advocacy organizations to support research of therapies for DMD. As of March 31, 2013, RNA had $48 million in cash and cash equivalents.

Clinical development

Drisapersen is being developed in collaboration with GlaxoSmithKline, or GSK. Drisapersen aims to restore dystrophin expression and improve muscle condition and function in the largest known sub-population of DMD patients.

In clinical trials, drisapersen has been shown to produce dystrophin expression and have a beneficial therapeutic effect on DMD patients. A Phase II placebo-controlled study of drisapersen in 53 DMD patients was completed and demonstrated a statistically significant and clinically important difference in the primary endpoint, which was the distance walked in the six minute walk test, or 6MWD, between the placebo group and the continuous active-treatment group at a dose of 6 mg/kg/week after 24 weeks.

This clinically meaningful benefit was maintained after 48 weeks of treatment, and drisapersen was well tolerated throughout the duration of this study. Preliminary results suggest that treatment with drisapersen was in general associated with increased levels of dystrophin expression when compared with pre-treatment levels.

Drisapersen successfully completed a twelve-patient Phase I/II study, and all patients were enrolled in an open-label extension study which has been ongoing since August 2009. The results indicate that drisapersen may lead to stabilization of the disease, as evidenced by an improvement or a slower than expected decline in the 6MWD, and the ongoing study continues to provide safety and tolerability data.

A pivotal Phase III study of drisapersen was initiated in December 2010, and results are expected in the fourth quarter of 2013. This study is a randomized, double-blind and placebo-controlled trial, assessing drisapersen at a dose of 6 mg/kg/week in 186 boys. The primary endpoint is the 6MWD at 48 weeks.

To date, over 300 patients have participated in clinical studies of drisapersen at more than 50 trial sites in 25 countries, and patient retention rates through March 2013 averaged 96% across all drisapersen clinical studies.

Follow-on DMD compounds

PRO044, the next most advanced product candidate, addresses a separate sub-population of DMD patients. RNA developed PRO044 using our exon-skipping technology to generate a product candidate with the same mechanism of action that is used by drisapersen.

PRO044 is currently in a Phase I/II study in Europe, which RNA expects to complete in the second half of 2013. RNA has four additional earlier-stage compounds that address other distinct sub-populations of DMD patients.

Of these, PRO045 entered clinical trials in the first quarter of 2013, and DMD anticipates that PRO053 will enter clinical trials in mid-2013. PRO052 and PRO055 are in advanced preclinical development.

RNA has started a research program, PROSPECT, which includes a new and innovative application of RNA's exon-skipping technology platform to specifically target rarer mutations in the dystrophin gene.

Intellectual property

RNA has entered into a collaboration arrangement with LUMC for the reciprocal licensing of RNA's and LUMC's individual and joint intellectual property rights in relation to certain patent rights and know-how rights, which have been the basis of RNA's research and development of treatment targeting DMD.

5% shareholders pre-IPO

ABV IV Holdings N.V., 21.4%
LSP Prosensa Pooling B.V., 21.4%
New Enterprise Associates 13, L.P., 20.8%
Gimv N.V., 9%
Idinvest Partners, 9%
MedSciences Prosensa Holding B.V., 6.9%

Use of proceeds

RNA expects to net $53 million from its IPO.

RNA currently expects that it will use the net proceeds from this offering, together with cash and cash equivalents on hand, as follows:

• $82 million to fund the current DMD development portfolio for which RNA bears expenses (PRO045, PRO053, PRO052 and PRO055), PROSPECT and DMD-support projects, including the DMD natural history study;

• $11 million to fund non-DMD projects, including DM1 and HD; and

• the remainder for working capital and other general corporate purposes.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for RNA
SFOScanner
21 Nov 14 06:37:35
Is it too early to look at Jan 16 calls? Here some stocks with incredibly expensive options $WPRT $HALO $RNA $EMES $MNKD $ARNA $NVAX
Matt
20 Nov 14 15:30:39
Hundreds of good articles of $SRPT $RNA at https://t.co/aTN1li9QAj
HotKeyTrading
19 Nov 14 20:30:11
Price Declines: $PPS $OSTK $HSP $INXN $INFI $NGG $AEIS $EA $LEJU $EJ $JIVE $TSS $RP $SEP $RNA http://t.co/TRx9EnjwT5 #stockpicks #spy #dow
Walter W. Borkowsky
19 Nov 14 09:58:26
Thin volume on $RNA today. #paperstacking
Lisa Urquhart
19 Nov 14 09:04:00
Prosensa CEO Hans Schikan says no plans to change their US filing data following the FDA's Sarepta data requests $SRPT $RNA #jefferies2014
Bin Xc
19 Nov 14 08:48:56
RT @HotKeyTrading: Price Declines: $INXN $INFI $NGG $AEIS $EA $LEJU $EJ $JIVE $TSS $RP $SEP $RNA $DKS $OME $PF http://t.co/Vv2VEnpBuv #watc…
HotKeyTrading
19 Nov 14 08:30:11
Price Declines: $INXN $INFI $NGG $AEIS $EA $LEJU $EJ $JIVE $TSS $RP $SEP $RNA $DKS $OME $PF http://t.co/Vv2VEnpBuv #watchlist #analyst #spy
Celia Economides
19 Nov 14 08:24:45
RT @Prosensa_RNA: Webcast at Jefferies Global HC Conf going on now in London http://t.co/44MwKhJE06 $RNA
Prosensa Holding N.V
19 Nov 14 08:24:39
Webcast at Jefferies Global HC Conf going on now in London http://t.co/44MwKhJE06 $RNA
beauregard
19 Nov 14 07:48:03
Slide 26 (bottom rt.) even if you use $rna-drisa sequence with $srpt-PMO chemistry, it is 1/10th as effective as eteplirsen.
beauregard
19 Nov 14 07:46:34
Slide 26: $rna 2-0-me produces massive inflammation (cytokines). $srpt PMO produces NO inflammation.
beauregard
19 Nov 14 07:44:16
slide26 (based on $rna research) proves $srpt PMO chemistry superior in gastroc, tibialis, tricep, quandricep, and diaphragm
beauregard
19 Nov 14 07:39:06
Slide16: Leiden (prosensa) researchers proved that $srpt PMO chemistry makes dystrophin in diaphragm, $rna's 2-o-me does not. Key to non-am.
WKRB News
19 Nov 14 06:36:25
Prosensa Holding NV Downgraded by Zacks $RNA http://t.co/1V0s47VKFb
HotKeyTrading
18 Nov 14 20:30:11
Price Declines: $RP $SEP $RNA $DKS $OME $PF $CYTR $BIG $CMGE $WSM $PAY $QUNR $TROW $TSEM $WHX http://t.co/Vv2VEnpBuv #investors #trader
Mad_Scientist
18 Nov 14 19:26:16
@given2tweet That is the current $RNA bull thesis in a nutshell.
dougheuring
18 Nov 14 16:16:21
Leerink $RNA $SEPR 3Q14 Recap: Drisapersen Rolling NDA Submission Underway, to be Finished in Jan http://t.co/1qwdodqGxT
InterCooler
18 Nov 14 12:35:18
Prosensa Holding NV Downgraded to Neutral at Zacks $RNA http://t.co/mO6p8CL7jZ
The Legacy News
18 Nov 14 12:05:14
Zacks Lowers Prosensa Holding NV to Neutral $RNA http://t.co/g9W9cSTL1b
Media Sentiment
18 Nov 14 11:25:13
$RNA received a new alert. Find out why at http://t.co/5lwmDm2SCs #stocks #daytrading #trading #mkt #NYSE #NASDAQ #markets 349
US Consumer News
18 Nov 14 11:22:41
Prosensa Holding NV downgraded by Zacks to neutral. $13.50 PT. http://t.co/7yTgbk8OZT $RNA #RNA
Analyst Ratings
18 Nov 14 11:22:23
Prosensa Holding NV downgraded by Zacks to neutral. $13.50 PT. http://t.co/yLYqoKvytg $RNA #RNA
Yu Zhu
18 Nov 14 08:53:37
RT @TomSilver39: C" $RNA Better Positioned For Filing and Approval in DMD than $SRPT,Prosensa= FDA will allow accelerated approval based on…
Tom Silver
18 Nov 14 08:33:42
C" $RNA Better Positioned For Filing and Approval in DMD than $SRPT,Prosensa= FDA will allow accelerated approval based on existing data."
Penny Stock Secret
18 Nov 14 07:57:59
Yesterday We Made $89,000 In Just One Trade More Info Here http://t.co/SVqoMlijqL .. $ATOS $HIFS $RNA
Shiraz Lakhi
18 Nov 14 07:22:59
Health Sector: Biggest 13 Wk %GAINERS trading DOWN > 2% today $MNOV $SAGE $RNA $ERB $CUTR ... (updates: click "View") http://t.co/Z0GTFsZmnW
BioRunUp
18 Nov 14 06:29:30
RT @CaptainFuture__: $SRPT related: CS on $RNA Q3 Earnings: Re-dosing Progressing in US/EU Re-dosing of patients is underway and (cont) htt…
Captain Sequence
18 Nov 14 06:26:39
$SRPT related: CS on $RNA Q3 Earnings: Re-dosing Progressing in US/EU Re-dosing of patients is underway and (cont) http://t.co/oofKOXgxiH
WKRB News
18 Nov 14 04:23:26
Prosensa Holding NV $RNA Releases Quarterly Earnings Results http://t.co/T1lAYoE2Rk
monestsignalen
18 Nov 14 03:31:03
Enkele bewegende sterke aandelen - http://t.co/ERCktBFuQQ - $RIC $TTM $RNA
CureDuchenne
17 Nov 14 16:04:10
RT @eperlste: Now at the Duchenne session with Bill Abernethy from @Prosensa_RNA and Debra Miller from @CureDuchenne. $RNA $SRPT #p4c2014
wizzwatch
17 Nov 14 14:57:21
After Hours Decliners: $RMTI, $SPHS, $OME, $NBS, $SKYS, $ACI, $QURE, $SLI, $ALLB, $HNH, $QKLS, $CYH, $RNA, $FOLD, $HALL, $EXLP, $URBN ...
Analyze
17 Nov 14 14:03:26
$AKBA $AMKR & $RNA are long trades,akba&amkr hold big potential of nice 10-20%move&rna has double bottom10.20-10.50w/wkly horn for potential
ethan
17 Nov 14 12:44:31
RT @VikramKhanna_: Given the expected vol around $SRPT 168 wk data, $RNA nat history study will be key catalyst. Expected at AAN
Vikram Khanna
17 Nov 14 12:40:43
Given the expected vol around $SRPT 168 wk data, $RNA nat history study will be key catalyst. Expected at AAN
Walter W. Borkowsky
17 Nov 14 12:21:56
Holding $RNA and $WLT. #paperstacking
Prosensa Holding N.V
17 Nov 14 12:15:47
RT @eperlste: Now at the Duchenne session with Bill Abernethy from @Prosensa_RNA and Debra Miller from @CureDuchenne. $RNA $SRPT #p4c2014
Robert West PhD
17 Nov 14 12:05:55
RT @eperlste: Now at the Duchenne session with Bill Abernethy from @Prosensa_RNA and Debra Miller from @CureDuchenne. $RNA $SRPT #p4c2014
Ethan O. Perlstein
17 Nov 14 11:59:12
Now at the Duchenne session with Bill Abernethy from @Prosensa_RNA and Debra Miller from @CureDuchenne. $RNA $SRPT #p4c2014
Fa$tlane $tocks
17 Nov 14 09:28:37
Tekmira Announces Licensing and Collaboration Agreement With Dicerna | 7:06 AM | [at noodls] - $RNA $TKMR http://t.co/7KZaIUpuiW
Fa$tlane $tocks
17 Nov 14 09:20:40
Tekmira Announces Licensing and Collaboration Agreement With Dicerna | 7:00 AM | [GlobeNewswire] - VA $RNA http://t.co/eZZelFJiS2
Sleek Money
17 Nov 14 06:38:19
Prosensa Holding NV $RNA Posts Quarterly Earnings Results http://t.co/zaxpCY6w5v
BioRunUp
17 Nov 14 05:05:58
RT @BioStocks: $RNA Q3. Rolling NDA submission drisapersen underway. Cash Euro 62M http://t.co/OVwprTzBv3 #DMD
Media Sentiment
17 Nov 14 05:04:14
$RNA received a new alert. Find out why at http://t.co/5lwmDm2SCs #stocks #daytrading #trading #mkt #NYSE #NASDAQ #markets 77
ZOZO
17 Nov 14 05:03:17
$RNA Prosensa Holding Q3 EPS of -€0.29 misses by €0.06.
MarketCurrents
17 Nov 14 04:46:45
Prosensa updates guidance after Q3 results http://t.co/t5SHQVCwAQ #premarket $RNA
US Banking News
17 Nov 14 04:43:25
Prosensa Holding NV announces earnings. ($0.29) EPS. http://t.co/u0BxmUJe7T $RNA #RNA
Instinctif LS
17 Nov 14 04:34:26
.@Prosensa_RNA Announces 3rd Quarter 2014 Financial Results and Recent Corporate Developments http://t.co/t40o98JfM3 $RNA
Dieter Hovekamp
17 Nov 14 04:31:15
RT @BioStocks: $RNA Q3. Rolling NDA submission drisapersen underway. Cash Euro 62M http://t.co/OVwprTzBv3 #DMD
Jon
17 Nov 14 04:27:04
RT @Prosensa_RNA: Prosensa Announces Q3 2014 Financial Results & Recent Corp Developments http://t.co/i11DSF8v6K $RNA conf call 8am ET: 1-8…
				
				
By  +Follow June 27, 2013 11:50AM
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