IPO Report: Bellerophon Therapeutics (BLPH)

Francis Gaskins |

bellerophon-large-3x2_1.jpgBellerophon Therapeutics (BLPH) is a clinical-stage therapeutics company focused on developing innovative products at the intersection of drugs and devices that address significant unmet medical needs in the treatment of cardiopulmonary and cardiac diseases. It is based in Hampton, New Jersey.

 

Six other companies are scheduled for the week of Feb. 9, 2015. The full IPO calendar is available at IPOpremium.

Manager, Joint-managers: Leerink Partners, Cowen and Company
Co-managers: FBR, SunTrust Robinson Humphrey

BLPH scheduled a $60 million IPO with a market capitalization of $179 million at a price range midpoint of $15 for Friday, Feb. 13, 2015 on Nasdaq. SEC Documents

Bellerophon Therapeutics Overview

BLPH is a clinical-stage therapeutics company focused on developing innovative products at the intersection of drugs and devices that address significant unmet medical needs in the treatment of cardiopulmonary and cardiac diseases.

BLPH has two programs in advanced clinical development.

Bellerophon Therapeutics Valuation

Glossary

Accumulated deficit (mm)

.

.

-$41

     

Per share dilution

.

.

-$7.63

     

-----------------------------------------------------------------------

     

Valuation Ratios

Mrkt Cap (mm)

Price /Sls

Price /Erngs

Price /BkVlue

Price /TanBV

% offered in IPO

annualizing Sept 9 mos

         

Bellerophon Therapeutics (BLPH)

$180

no rev

-2.9

2.0

2.0

33%

             

Bellerophon Therapeutics Conclusion

Neutral

Focused on cardiopulmonary and cardiac diseases

P/E of -2.9 indicating very heavy cash burn relative to market cap

Phase 3 clinical trial  planned for 2nd half of 2015

Price-to-book 2.0

No revenue

Accounting inconsistency, accumulated defict reported as -$41mm, but the co lost -$150mm last 2 years

Bellerophon Therapeutics Business

BLPH is a clinical-stage therapeutics company focused on developing innovative products at the intersection of drugs and devices that address significant unmet medical needs in the treatment of cardiopulmonary and cardiac diseases.

BLPH has two programs in advanced clinical development.

Bellerophon Therapeutics INOpulse

The first program, INOpulse, is based on BLPH’s proprietary pulsatile nitric oxide delivery device.

BLPH is currently developing two product candidates under BLPH’s INOpulse program: one for the treatment of pulmonary arterial hypertension, or PAH, for which BLPH intends to commence Phase 3 clinical trials in the second half of 2015, and the other for the treatment of pulmonary hypertension associated with chronic obstructive pulmonary disease, or PH-COPD, which is in Phase 2 development.

Bellerophon Therapeutics Bioabsorbable Cardiac Matrix

BLPH’s second program is bioabsorbable cardiac matrix, or BCM, which is currently in a placebo-controlled clinical trial designed to support CE mark registration in the European Union.

BLPH completed enrollment of this trial in December 2014, with 303 patients having completed the treatment procedure, and BLPH expect to report top line results in mid-2015.

Assuming positive results, BLPH intends to conduct a pivotal pre-market approval trial of BCM beginning in the first half of 2016, which will be designed to support registration in the United States.

BLPH is developing BCM for the prevention of cardiac remodeling, which often leads to congestive heart failure following an ST-segment elevated myocardial infarction, or STEMI.

BLPH’s INOpulse program is an extension of the technology used in hospitals to deliver continuous-flow inhaled nitric oxide.

Use of inhaled nitric oxide is approved by the U.S. Food and Drug Administration, or the FDA, and certain other regulatory authorities to treat persistent pulmonary hypertension of the newborn.

Ikaria, Inc., or Ikaria, the pre-spinoff parent, has marketed continuous-flow inhaled nitric oxide as INOmax for hospital use in this indication since approval in 1999. In October 2013,

Bellerophon Therapeutics Intellectual Property

As of January 12, 2015, BLPH holds exclusive licenses from Ikaria to at least 80 patents and pending patent applications in both the United States and foreign countries including Australia, Brazil, Canada, China, Europe, Hong Kong, India, Indonesia, Israel, Japan, Korea, Mexico, the Philippines, Russia and Singapore.

Certain of these issued patents and patent applications, if issued, will expire as late as 2033. These patent rights have been exclusively licensed for the treatment of patients with PAH, PH-COPD and PH-IPF and cover methods of delivery and the drug delivery device, as well as important safety features and the ornamental design of the drug delivery device.

A primary basis for patent exclusivity is based on pending and issued in-licensed patents directed to proprietary methods of administering pulsed inhaled nitric oxide, as well as a device for delivering the same.

This patent family expires as late as 2027 in the United States and as late as 2026 in Australia, Brazil, Canada, China, Europe, Hong Kong, Japan and Mexico.

Bellerophon Therapeutics Competition

Currently, there are 12 drugs approved for the treatment of PAH, within the following categories:

  • rostacyclin and prostacyclin analogs (including Flolan (epoprostenol), which is marketed by GlaxoSmithKline,
  • Tyvaso (treprostinil), Orenitram (treprostinil) and Remodulin (treprostinil), which are marketed by United Therapeutics Corporation, and
  • Ventavis (iloprost) and Veletri (epoprostenol), which are marketed by Actelion Pharmaceuticals US, Inc., or Actelion),
  • phosphodiesterase type-5 inhibitors (including Adcirca (tadalafil), which is marketed by United Therapeutics Corporation, and
  • Revatio (sildenafil), which is marketed by Pfizer Inc.,
  • endothelin receptor antagonists (including Letairis (ambrisentan), which is marketed by Gilead Sciences, Inc., and
  • Opsumit (macitentan) and Tracleer (bosentan), which are marketed by Actelion) and
  • a soluble guanylate cyclase stimulator (Adempas (riociguat), which is marketed by Bayer HealthCare Pharmaceuticals Inc.).
  • Actelion recently submitted an NDA to the FDA for selexipag, a selective prostacyclin receptor agonist.

Bellerophon Therapeutics 5% Shareholders Pre-IPO

New Mountain Entities               47.9%

Linde    16.1%

ARCH   9.5%

Venrock            9.5%

Jens Luehring    16.1%  

Robert Nelsen   9.5%

Bellerophon Therapeutics Dividends

No dividends are planned.

Bellerophon Therapeutics Use of Proceeds

BLPH expects to receive $53 million from its IPO and use it for the following:

$45 million to fund its planned Phase 3 clinical development of INOpulse for PAH; 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. To read our full disclosure, please go to: http://www.equities.com/disclaimer

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