IPO Report: Spark Therapeutics (ONCE)

Francis Gaskins  |

Spark Therapeutics (ONCE) is a leader in the field of gene therapy, seeking to transform the lives of patients suffering from debilitating genetic diseases by developing one-time, life-altering treatments. It is based in Philadelphia, PA.

Eleven other companies are scheduled to IPO for the week of Jan. 26, 2015. The full IPO calendar is available at IPOpremium.

Manager, Joint-managers: J.P. Morgan and Credit Suisse.

Co-managers: Cowen & Company and Sanford Bernstein.

ONCE scheduled an $88 million IPO with a market capitalization of $352 million at a price range midpoint of $16 for Friday, Jan. 30, 2015 on Nasdaq. Midpoint raised to $20, no change in conclusion. SEC Documents

Spark Therapeutics IPO Overview

ONCE is a leader in the field of gene therapy, seeking to transform the lives of patients suffering from debilitating genetic diseases by developing one-time, life-altering treatments.

The goal of gene therapy is to overcome the effects of a malfunctioning, disease-causing gene by delivering a normal, functional copy of the same gene.

Spark Therapeutics IPO Valuation


Accumulated deficit (mm)





Per share dilution







Valuation Ratios

Mrkt Cap (mm)

Price /Sls

Price /Erngs

Price /BkVlue

Price /TanBV

% offered in IPO

annualizing Sept 9 mos


Spark Therapeutics (ONCE)








Spark Therapeutics IPO: Conclusion


1st product candidate targets rare blinding conditions

Phase 3 results 2nd half of '15

Pfizer collaboration for hemophilia B

Relatively low price-to-book of 2.5

Moderately low cash burn rate:  P/E ratio of -17.6

Insiders may purchase $15mm, 17%

Spark Therapeutics Business

ONCE is a leader in the field of gene therapy, seeking to transform the lives of patients suffering from debilitating genetic diseases by developing one-time, life-altering treatments.

The goal of gene therapy is to overcome the effects of a malfunctioning, disease-causing gene by delivering a normal, functional copy of the same gene.

ONCE’s product candidates have the potential to provide long-lasting effects, dramatically and positively changing the lives of patients with conditions where no, or only palliative, therapies exist.

ONCE’s initial focus is on treating orphan diseases, and ONCE has demonstrated promising clinical outcomes with its first ophthalmic product candidate targeting rare blinding conditions, which has received both breakthrough therapy and orphan product designation.

ONCE also has built a pipeline of product candidates targeting additional blinding conditions, hematologic disorders and neurodegenerative diseases, including a second product candidate targeting another rare blinding condition.

Spark Therapeutics-Pfizer (PFE) collaboration

In December 2014, ONCE entered into a global collaboration agreement with Pfizer for the development and commercialization of SPK-FIX product candidates for the treatment of hemophilia B.

Under the terms of the agreement, ONCE is entitled to a $20.0 million upfront payment, and is eligible to receive up to $260.0 million in aggregate milestone payments, as well as royalties calculated as a low-teen percentage of net product sales.

Spark Therapeutics Market

Patients suffering from RPE65-mediated inherited retinal dystrophies (IRDs) are affected by a range of severe visual impairments, which ultimately lead to blindness, that make independent activities of daily living challenging.

For example, affected children often depend on visual aids to carry out classroom activities while adults with these diseases may face diminished employment opportunities and may be stripped of the rewards of parenting, such as watching a child play his or her favorite sport.

ONCE estimates that there are approximately 3,500 individuals with RPE-mediated IRDs in the United States and the five major European markets.

Spark Therapeutics Manufacturing Process

ONCE's proprietary manufacturing processes produce consistent yields of highly pure and stable gene therapies, including both adeno-associated virus, or AAV, and lentiviral vectors.

ONCE vectors are disarmed viruses that carry genetic material into target cells, where they deliver a functional gene that allows production of a normal protein.

Spark Therapeutics Platform Technology

ONCE’s platform technology is based on more than two decades of gene therapy research, development, manufacturing and clinical trials conducted at The Children’s Hospital of Philadelphia, or CHOP.

ONCE is building a fully integrated gene therapy platform to accelerate the development of product candidates across multiple therapeutic areas.

ONCE engineered initial product candidates using AAV vectors to efficiently enter target cells in different tissue types and deliver their gene payload.

ONCE is pursuing other follow-on product candidates targeting other IRDs, including SPK-CHM for the treatment of choroideremia.

ONCE has initiated enrollment in a dose-escalating Phase 1/2 trial for SPK-CHM, and expects to begin dosing subjects in this trial in the first quarter of 2015.

Spark Therapeutics Liver Gene Therapies

ONCE has established human proof-of-concept in using gene therapy to deliver and express a therapeutic gene in the liver as part of the SPK-FIX program for the treatment of hemophilia B, and expects to initiate a Phase 1/2 clinical trial for the lead SPK-FIX product candidate in the first half of 2015.

Spark Therapeutics Clinical trials

ONCE’s most advanced product candidate, SPK-RPE65, which is in a pivotal Phase 3 clinical trial, targets a group of rare blinding conditions known as inherited retinal dystrophies, or IRDs, caused by non-sex linked, or autosomal recessive, mutations in the RPE65 gene.

ONCE is conducting a fully enrolled, pivotal Phase 3 clinical trial of SPK-RPE65 in which ONCE has  dosed all subjects in the treatment group and currently are collecting data.

ONCE anticipates reporting final results during the second half of 2015. If successful, ONCE plans to submit a biologics license application, or BLA, to the U.S. Food and Drug Administration, or FDA, in 2016.

SPK-RPE65 has the potential to be the first gene therapy approved in the United States for the treatment of a genetic disease and the first approved pharmacologic treatment for any IRD.

To date, results from ONCE’s two Phase 1 clinical trials, along with reports from its clinical study team and other feedback regarding the subjects in the trials, suggest that SPK-RPE65 enables subjects to perform activities of daily living with greater independence than prior to treatment and has long-lasting effects in restoring functional vision, with subjects having been followed for a period of at least five years.

Notably, as reported by ONCE’s clinical study team, following a single injection of SPK-RPE65 in one eye, the children from its initial Phase 1 trial no longer depended on visual aids to carry out classroom activities and were able to walk and play more like normally-sighted kids.

Furthermore, inclusive of the subjects in ONCE’s ongoing Phase 3 clinical trial, ONCE has not observed any drug-related serious adverse events to date.

Spark Therapeutics Intellectual property

As of January 15, 2015, ONCE’s patent portfolio included approximately 159 U.S. and foreign patents and patent applications licensed from CHOP, UIRF, Penn and NIH.

These patents and patent applications cover technology used in ONCE’s own development programs, as well as technology used in its collaborations with Pfizer and Genable.

ONCE has granted Pfizer an exclusive worldwide license for the development and commercialization of product candidates for the treatment of hemophilia B under the patents and other rights listed below that relate to its SPK-FIX program.

Spark Therapeutics Competition

ONCE is aware of several companies focused on developing gene therapies in various indications, including bluebird bio, AGTC, Asklepios, Audentes, Avalanche, Dimension, GenSight, NighstaRx, ReGenX and uniQure, as well as several companies addressing other methods for modifying genes and regulating gene expression.

Any advances in gene therapy technology made by a competitor may be used to develop therapies that could compete against any of ONCE’s product candidates.

For ONCE’s particular product candidates, the main competitors include:

 RPE65. While no approved pharmacologic agents exist for patients with RPE65-mediated IRDs, Second Sight Medical Products (EYES) has received approval from FDA and other foreign regulatory authorities for a retinal prosthesis medical device, which is being marketed to RP patients with limited or no light perception.

Another retinal prosthesis medical device from Retina Implant has obtained a CE Certificate of Conformity from its notified body, and is similarly indicated for blinded patients. QLT is in Phase 1b clinical development with a vitamin A derivative to treat RP and LCA.

In the gene therapy space, AGTC, as well as several academic institutions, have conducted clinical trials involving RPE65-based product candidates, but none has completed a Phase 1 trial of injection of the second eye or initiated a Phase 3 trial, and ONCE believes it is the furthest along in development of any gene therapy product to treat this disease.

Choroideremia. ONCE is aware that NightstaRx. is developing an AAV-based gene therapy for the treatment of choroideremia.

NightStaRx has obtained orphan product designation in the European Union for this product candidate for the treatment of choroideremia and a Phase 1/2 trial of this product candidate is being conducted in Europe.

Hemophilia B. Hemophilia B patients typically are treated by a variety of plasma-derived, recombinant or long-acting products that are produced by a number of companies, including Pfizer. Many other companies are developing gene therapies to treat hemophilia B, including Baxter, uniQure and Dimension.

Spark Therapeutics 5% shareholders pre-IPO

Steven Altschuler, M.D. 53.4%

Anand Mehra, M.D.       11.5%              

CHOP Foundation         53.4%    

Sofinnova Venture Partners VIII, L.P.      11.5%

Entities affiliated with Baker Bros. Advisors LP   7.7%                   

Spark Therapeutics Dividends

No dividends are planned.

Spark Therapeutics IPO: Use of proceeds

ONCE expects to receive $79 million from its IPO and use it for the following:

$9.0 million to fund external research and development expenses for its lead product candidate SPK-RPE65 for the treatment of inherited retinal dystrophies caused by RPE65 mutations;

$5.0 million to fund external research and development expenses for its product candidate SPK-CHM for the treatment of choroideremia;

$4.0 million to fund external research and development expenses for its SPK-FIX program for the treatment of hemophilia B;

$10.0 million to fund external research and development expenses for preclinical product candidates; and

the remainder for working capital, general and administrative expenses, internal research and development expenses and other general corporate purposes, including pre-commercial activities, in-licenses and potential acquisitions.

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


Can the Media Solve the Partisan Conflict?

Andrew McCarthy, Contributing Editor, The National Review; Michael Zeldin, CNN Legal Analyst; Celeste Katz, Senior Political Reporter, Glamour; Silvia Davi, SVP, Contributing Editor, Equities.com; and Doug Simon, CEO, D S Simon Media discuss how the media’s role has shaped the landscape for communicators and what the media is trying to do to reduce discord in society.

Emerging Growth

IMV Inc.

Immunovaccine Inc is clinical stage biopharmaceutical company. The Company develops products based on its proprietary vaccine enhancement platform in T cell activating therapies for cancer.