IPO Report: Eleven Biotherapeutics (EBIO)

Francis Gaskins |

Eleven Biotherapeutics ($EBIO) is a clinical-stage biopharmaceutical company with a proprietary protein engineering platform, called AMP-Rx, that it applies to the discovery and development of protein therapeutics to treat diseases of the eye.

13 other companies are scheduled to IPO this week.  The full IPO calendar is available at IPOpremium.com

EBIO scheduled a $60 million IPO with a market capitalization of $206 million at a price range midpoint of $14 for Thursday, Feb. 6, 2014, on the Nasdaq.

Manager, Joint managers: Citi, Cowen & Company, Leerink Partners

Co-Managers: None

SEC Documents

Overview

EBIO’s planned pivotal Phase 3 clinical program will consist of two Phase 3 clinical trials evaluating the safety and efficacy of EBI-005 for the treatment of moderate to severe dry eye disease and a separate clinical trial evaluating the safety of treatment with EBI-005 for one year.

Valuation

Glossary

Cash burn rate:  when a company loses money with minimal depreciation & amortization (think biopharmas), the negative Price/Loss ratio is an indication of cash burn rate.  The higher the loss the lower the absolute (negative) ratio.  The lower the loss the higher the absolute (negative) ratio.

Valuation Ratios

Mrkt

Price /

Price /

Price /

Price /

% offered

annualizing Sept 9 mos

Cap (mm)

Sls

Erngs

BkVlue

TanBV

in IPO

Eleven Biotherapeutics (EBIO)

$206

771.8

-11.9

3.5

3.5

29%

 

 

 

 

 

 

 

Conclusion

Positive, phase 3 planned, shareholders buying, cash burn rate ok relative to other biopharmas.

Business

EBIOis a clinical-stage biopharmaceutical company with a proprietary protein engineering platform, called AMP-Rx, that it applies to the discovery and development of protein therapeutics to treat diseases of the eye.

EBIO’s therapeutic approach is based on the role of cytokines in diseases of the eye, its understanding of the structural biology of cytokines and its ability to rationally design and engineer proteins to modulate the effects of cytokines.

Cytokines are cell signaling molecules found in the body that can have important inflammatory effects.

EBIO’s most advanced product candidate is EBI-005, which it designed, engineered and generated using its AMP-Rx platform and are developing as a topical treatment for dry eye disease and allergic conjunctivitis.

Clinical trials

EBIO’s planned pivotal Phase 3 clinical program will consist of two Phase 3 clinical trials evaluating the safety and efficacy of EBI-005 for the treatment of moderate to severe dry eye disease and a separate clinical trial evaluating the safety of treatment with EBI-005 for one year.

Based on EBIO’s estimates regarding patient enrollment, if this clinical program is successful, EBIO plans to submit a Biologics License Application, or BLA, to the U.S. Food and Drug Administration, or FDA, seeking approval of EBI-005 for the treatment of dry eye disease in the United States in the second half of 2016.

EBIO also plans to initiate a Phase 2 clinical trial to evaluate the use of EBI-005 in patients with allergic conjunctivitis in early 2014

In 2013, EBIO completed a Phase 1b/2a clinical trial of EBI-005 in patients with moderate to severe dry eye disease. EBIO is initiating a pivotal Phase 3 clinical program evaluating EBI-005 for the treatment of moderate to severe dry eye disease.

Intellectual property

As of January 21, 2014, EBIO owned or exclusively in-licensed a total of 18 U.S. patent applications, as well as numerous foreign counterparts of some of these patent applications.

Competition

Competitors include pharmaceutical companies, biotechnology companies, and specialty pharmaceutical and generic drug companies of various sizes, such as Shire Plc (lifitegrast), Acucela Inc., in collaboration with Otsuka Pharmaceutical Co., Ltd. (rebamipide), Mimetogen Pharmaceuticals Inc., in collaboration with Bausch + Lomb Corporation (MIM-D3), OphthaliX Inc. (CF101), Rigel Pharmaceuticals, Inc. (R9348) and Allergan, Inc

5% stockholders

Entities affiliated with Flagship Ventures Management, Inc. 28.8% 

JAFCO Super V3 Investment Limited Partnership 18.4

Third Rock Ventures, L.P. 41.3%

Use of proceeds

EBIOexpects to net $53 million from its IPO. Proceeds are allocated as follows:

$36 million to fund external research and development expenses for EBIO’s pivotal Phase 3 clinical program for EBI-005 in patients with moderate to severe dry eye disease and, if the results from this program are favorable, the submission of a Biologics License Application, or BLA, to the United States Food and Drug Administration, or FDA, seeking approval of EBI-005 for the treatment of dry eye disease in the United States;

$3 million to fund external research and development expenses for EBIO’s Phase 2 clinical trial of EBI-005 in patients with allergic conjunctivitis; and

the remainder for working capital and other general corporate purposes, which will include EBIO’s internal research and development expenses for EBI-005, development of its preclinical product candidates and pursuit of its other research and discovery efforts and could also include the acquisition or in-license of other products, product candidates or technologies.

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

Companies

Symbol Name Price Change % Volume
EBIO Eleven Biotherapeutics Inc. 2.49 0.10 4.18 1,909,077
AILLP Ameren Illinois 4 Pfd 98.25 0.00 0.00 0

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