Based in Chapel Hill, NC, Heat Biologics ($HBTX) scheduled a $25 million IPO with a market capitalization of $65 million at a price range mid-point of $11, for Wednesday, July 24, 2013.
Ten other IPOs were scheduled for the week of July 15. The full IPO calendar can be found at IPOpremium.
S-1 filed July 8, 2013
Manager, Joint Managers: Aegis Capital Corp.
Co Manager: Cantor Fitzgerald
Conclusion
Avoid, trying to do too much with no collaboration partners. Needs money for Phase 2 clinical trials. Will encounter substantial competition.
Business
HBTX is a development stage biopharmaceutical company engaged in the development of novel allogeneic, “off-the-shelf” cellular therapeutic vaccines to combat a wide range of cancers and infectious diseases.
HBTX’s proprietary ImPACT™ Immune Pan Antigen Cytotoxic Therapy is being designed to deliver live, genetically-modified, irradiated human cells which are reprogrammed to “pump out” a broad spectrum of cancer-associated antigens together with a potent immune adjuvant called “gp96” to educate and activate a cancer patient’s immune system to recognize and kill cancerous cells.
HBTX intends for its ImPACT cells to secrete an antigen-adjuvant complex that generates anti-cancer immune responses in patients by mobilizing and activating cytotoxic “killer” T cells that target multiple cancer antigens, thus harnessing a patient’s own immune system to fight cancer.
Unlike autologous or “personalized” therapeutic vaccine approaches which require extraction and processing of cancer or blood from each individual patient, HBTX’s ImPACT therapeutic vaccine uses a master cell line containing a host of known and unknown tumor associated antigens to mass-produce a single vaccine product applicable to all patients with a particular cancer type.
Their primary product candidates are HS-110 and HS-410.
Competition
The most significant competitors, among others, are fully integrated pharmaceutical companies such as Eli Lilly (Alimta), Bristol-Myers Squibb (Erbitux) and Sanofi-Aventis (Eloxatin), and more established biotechnology companies such as Roche/Genentech (Avastin and Tarceva), and competing cancer autologous immunotherapy companies such as Dendreon.
Use of proceeds
HBTX expects to net $22.5 million from its IPO.
Proceeds are allocated as follows:
$8,350,000 to complete the Phase 2 clinical trials for HS-110 against non-small lung cancer and the submission of related materials to the FDA or an equivalent amount as grant matching funds to fund an expanded clinical trial.
HTBX plans to initiate a 125 patient Phase 2 trial on patients with advanced non-small cell lung cancer. The Phase 2 study has been designed as a maintenance therapy study in patients with Stage III/IV NSCLC who have completed a 1st line regimen consisting of a platinum doublet, crizotinib or erlotinib and achieved at least stable disease.
HTBX plans to use up to $8.35 million from the net proceeds of this offering to finance this trial.
HBTX has applied for grant funding to enable us to expand the size and scope of this clinical trial and if the grant funding is received, will use up the $8.35 million of the net proceeds from this offering as “matching funds” as required by the granting organization to expand the size and scope of the trial.
If sufficient grant funding is not received by the commencement of the trial to fund the trial, HBTX will use the net proceeds of this offering to provide the needed funding for a 125 patient Phase 2 trial.
$1,000,000 for initiation and completion of Phase 1/2 clinical trials of HS-410 against bladder cancer. MBTX plans to file an IND for use of HS-410 to prevent the recurrence of bladder cancer. This initial IND will include a 93 patient, Phase 1/2 trial to examine safety, tolerability, immune response and preliminary clinical activity of HS-410 in patients with high risk, superficial bladder cancer who have completed surgical resection and 6 weekly intravesical bacillus Calmet-Guerin (BCG) immunotherapy installations. HBTX plans to use $1 million from the net proceeds of this offering to enhance the scope of this trial as currently designed and funded;
$1,500,000 to fund one to two additional Phase 1 clinical trials on additional cancer indications. HBTX ise creating and has created ImPACT-based drugs against additional cancers and plan to use $1.5 million from the net proceeds of this offering to fund one to two additional Phase 1 clinical trials on additional cancer indications;
The remaining net proceeds will be used for general corporate purposes, including ongoing operations, vendor payables and expansion of the business, further research and development, potential regulatory submissions and hiring additional sales and marketing personnel to support increased sales and marketing activities.
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