IPO Report: Alder BioPharmaceuticals (ALDR)

Francis Gaskins  |

Alder BioPharmaceuticals ($ALDR) is a clinical-stage biopharmaceutical company that discovers, develops, and seeks to commercialize therapeutic antibodies with the potential to meaningfully transform current treatment paradigms It is headquartered in Bothell, WA.

Eight other companies are scheduled for the week of May 5, 2014. The complete IPO calendar is available at IPOpremium.

The manager and joint managers are Credit Suisse and Leerink Partners. The co-managers are Wells Fargo Securities and Sanford C. Bernstein.

ALDR scheduled a $100 million IPO on the Nasdaq with a market capitalization of $407 million at a price range midpoint of $14 for Thursday, May 8, 2014.  SEC Filings


ALDR is a clinical-stage biopharmaceutical company that discovers, develops and seeks to commercialize therapeutic antibodies with the potential to meaningfully transform current treatment paradigms.

ALDR has a major collaboration agreement with Bristol-Myers Squibb (BMS) , which has a market cap of $82 billion.

BMS has indicated an interest in purchasing up to $20 million of  the IPO, or 20%.



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The rating on ALDR is positive because of the Bristol-Myers-Squib relationship.


ALDR is a clinical-stage biopharmaceutical company that discovers, develops and seeks to commercialize therapeutic antibodies with the potential to meaningfully transform current treatment paradigms.

ALDR has developed a proprietary antibody platform designed to select antibodies that have the potential to maximize efficacy as well as speed of onset and durability of therapeutic response.

In addition, ALDR believes its ability to efficiently manufacture antibodies using its yeast-based manufacturing technology, MabXpress, allows ALDR to target diseases that traditionally have not been addressed by antibodies.

Both ALDR’s lead product candidates were discovered internally, have achieved proof-of-concept and are expected to enter final Phase 2b dose-ranging trials in 2014 in preparation for progression to Phase 3 trials if supported by the data.

ALD403 is ALDR’s wholly-owned novel monoclonal antibody targeted to calcitonin gene-related peptide, or CGRP, for migraine prevention. ALDR recently completed a three month randomized, placebo-controlled proof-of-concept trial of ALD403 in 163 patients suffering from five to 14 migraine days per month, or high frequency migraine.

ALDR plans to initiate a Phase 2b dose-ranging trial in the second half of 2014, with the goal of initiating pivotal Phase 3 trials in 2016.

Clazakizumab is a novel monoclonal antibody that inhibits the pro-inflammatory cytokine interleukin-6, or IL-6, and is being developed for both RA and psoriatic arthritis, or PsA.

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Bristol-Myers Squibb (BMS)

In November 2009, ALDR entered into a license and collaboration agreement with Bristol-Myers Squibb, or BMS, for the development and commercialization of Clazakizumab and received an $85 million upfront payment.

BMS is responsible for paying 100% of worldwide development costs for all indications, except cancer, and reimbursing ALDR for certain clinical supply and development costs, subject to ALDR being responsible for approximately 50% of costs incurred by ALDR for development of manufacturing process improvements up to certain caps with respect to such costs.

To date, in addition to the upfront payment, ALDR has received two milestone payments totaling $18.5 million in the aggregate and reimbursed clinical supply and development costs of $26.6 million. ALDR may also receive additional development-based and regulatory-based milestone payments of up to $394.0 million in RA.

In addition, if Clazakizumab is commercialized for RA, ALDR may receive sales-based milestones up to $500.0 million and tiered royalties starting in the mid-teens up to 20% on net sales of Clazakizumab.

Under the collaboration agreement, ALDR is entitled to additional milestone payments and royalties for additional indications, subject to certain reductions.

Evaluating four programs

ALDR is currently evaluating four programs with the view of advancing at least one candidate into the clinic in 2015 for a disease indication where therapeutic antibodies have not previously played a role. ALDR will continue to enhance its technologies to discover optimized product candidates that can be manufactured efficiently on a very large scale.

ALDR may seek to monetize its technology platform by consummating partnerships with leading biotechnology and pharmaceutical companies. ALDR also intend to continue to deploy capital to selectively develop its own portfolio of product candidates.

Auditors express doubt

"Our auditors have issued a going concern opinion on our 2013 financial statements, expressing substantial doubt that we can continue as an ongoing business for the next 12 months after issuance of their report."

However, if the ALDR IPO is successful ALDR believes the auditors will reserve the 'going concern' opinion.

Dividend Policy

No dividends are planned.

Intellectual Property

ALDR ‘s patents and patent applications relating to Clazakizumab have been broadly filed worldwide.

Many of these applications have issued in the United States and other countries and will expire between 2028 and 2031, or later if patent term extension applies.

ALDR ‘s patent applications relating to ALD403 have also been broadly filed worldwide. If these applications issue as patents, they are estimated to expire in 2032.

ALDR holds two U.S. patents; one allowed U.S. patent application and numerous foreign patents related to MabXpress. ALDR’s MabXpress patents and patent applications relate to the expression of heteropolymeric polypeptides, such as antibodies, in Pichia. These patents will expire between 2024 and 2026.


ALDR faces competition with respect to its current product candidates, and will face competition with respect to product candidates that ALDR may seek to develop or commercialize in the future, from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide.

In addition, ALDR’s ability to compete may be affected in many cases by insurers or other third-party payors seeking to encourage the use of biosimilar products, which are expected to become available over the coming years.

Many of ALDR’s competitors are large pharmaceutical companies that will have a greater ability to reduce prices for their competing drugs in an effort to gain market share and undermine the value proposition that ALDR might otherwise be able to offer to payors.

Potential competitors also include academic institutions, government agencies and other public and private research organizations that conduct research, seek patent protection and establish collaborative arrangements for research, development, manufacturing and commercialization.

5% stockholders

Entities affiliated with Sevin Rosen    23.7%

Ventures West 8 Limited Partnership 14.7%

Novo A/S   12.1%

Entities affiliated with H.I.G. Venture Partners  11.8%

Entities affiliated with Delphi Ventures       11.4%

TPG Biotechnology Partners II, L.P.    11.4%

Stephen M. Dow   24.9% 

Use of proceeds

ALDR expects to net $91 million from its IPO. Proceeds are allocated as follows:


          $37 million for its planned Phase 2b dose-ranging trial of its monoclonal antibody, ALD403, targeting CGRP for prevention of migraine;





$5.5 million for preclinical product development activities; and





the balance for working capital and other general corporate purposes, which may include the acquisition or licensing of other products, businesses or technologies.


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