IPO Launch: Calliditas Therapeutics Seeks $75 Million In U.S. IPO


Calliditas Therapeutics (CALT) intends to raise $75 million from the sale of its ADSs, per an amended registration statement.

The company is advancing a pipeline of drug candidates for the treatment of kidney and liver diseases.

CALT had produced promising trial results, expects Phase 3 trial topline readout by the end of 2020 and the IPO appears reasonably valued.

For life science investors with a 9 - 18 month hold time frame, my opinion on the IPO is a BUY at up to or around $19.77 per ADS.


Stockholm, Sweden-based Calliditas was founded to focus on renal and hepatic diseases and is advancing a pipeline of treatments for IgA Nephropathy and primary biliary cholangitis [PBC].

Management is headed by Renee Aguiar-Lucander, who has been with the firm since May 2017 and was previously Partner at Omega Fund Management, a life science venture capital firm.

Below is a brief overview video of Calliditas' approach:

Source: Biotech showcase

The firm's lead candidate, for the treatment of IgAN, a serious autoimmune disease of the kidney, is currently in Phase 3 trials.

The end of Phase 2 trials have been received favorably by the FDA, which 'has indicated alignment on a pathway toward accelerated approval in the United States based on the evaluation of a surrogate endpoint rather than a clinical outcome endpoint. We have received similar feedback from the EMA on a conditional market access pathway in the European Union.'

Below is the current status of the company’s drug development pipeline:


Source: Company F-1 Filing

Investors in the firm have invested at least $129.6 million and include Stiftelsen Industrifonden, Linc AB, Investinor AS, Fourth Swedish National Pension Fund, Gladiator, BVF Partners and Handelsbanken Fonder AB.

According to a 2020 market research report by Delve Insight, per a recent study, the global incidence of IgAN is at least 2.5 per 100,000 per year for adults.

And, one in four adults who have the disease eventually will have total kidney failure.For children, one in every ten to twenty children will have total kidney failure as a result of contracting the disease.

Major competitive vendors that provide or are developing treatments include:

  • Omeros
  • Reata
  • Apellis
  • Novartis (NVS)
  • Merck KGaA (MRK)
  • Retrohpin

Calliditas’s recent financial results are atypical of IPO stage biopharma firms in that they feature significant revenue in 2019.

Other aspects of the firm’s operational results are typical, such as the high R&D expenses associated with advancing its pipeline of drug programs.

Below are the company’s financial results for the past two and ¼ years (Audited IFRS for full years):


Source: Company registration statement

As of March 31, 2020, the company had $77.7 million in cash and $6.4 million in total liabilities. (Unaudited, interim)

CALT intends to sell 3.8 million ADSs at an expected price of $19.77 per share for gross proceeds of approximately $75.0 million, not including the sale of customary underwriter options.

The firm also intends to conduct a European private placement of an undetermined amount.

Calliditas is also traded on the Swedish stock exchange under the symbol CALTX.

Assuming a successful IPO at the midpoint of the proposed price range, the company’s enterprise value at IPO would approximate $389.6 million.

Excluding effects of underwriter options and private placement shares or restricted stock, if any, the float to outstanding shares ratio will be approximately 16.05%.

Per the firm’s most recent regulatory filing, it plans to use the net proceeds as follows:

  • approximately $50.0 million to $56.0 million to fund our ongoing Phase 3 clinical trial and related trials of Nefecon and, if the results from Part A of this Phase 3 clinical trial are positive, to file for regulatory approval in the United States and the European Union;
  • approximately $55.0 to $63.0 million to fund pre-commercial and, if approved, commercial activities for Nefecon for the treatment of IgAN; and
  • the remainder to fund the development of additional product candidates in indications for which Nefecon or its active ingredient may have therapeutic potential, including PBC and AIH, or for any product candidates that we in-license or acquire, and for working capital and other general corporate purposes.

Management’s presentation of the company roadshow is available here.

Listed underwriters of the IPO are Citigroup, Jefferies, Stifel and Carnegie.


CALT is seeking U.S. public market funding to essentially get its Nefecon over the Phase 3 trial goal line and ready for marketing approval.

For its lead candidate, management expects topline data readout by the end of 2020, seven months from now.

The firm’s trial results to-date appear to provide impressive reduction of protein in the urine and stabilization of kidney function.

Management estimates that IgAN ‘affects approximately 130,000 to 150,000 people in the United States and approximately 200,000 people in Europe,’ the two regions where it plans to submit marketing approval requests.

The dollar size estimates for the U.S. are up to $10 billion annually, based on management estimates which I could not independently verify.

Citigroup is the lead left underwriter and IPOs led by the firm over the last 12-month period have generated an average return of negative (25.2%) since their IPO. This is a bottom-tier performance for all major underwriters during the period.

As to valuation, management is asking investors to pay an enterprise value of $390 million, which is within the typical valuation range for biopharma IPOs.

Given the advanced trial status, promising results to-date and reasonable valuation, for life science investors with a 9 - 18 month hold time frame, my opinion on the IPO is a BUY at or around the expected IPO price of $19.77 per ADS.


Expected IPO Pricing Date: June 4, 2020.

(I have no position in any stocks mentioned as of the article date, no plans to initiate any positions within the next 48 hours, and no business relationship with any company whose stock is mentioned in this article. Information provided is for educational purposes only, may be incomplete or out of date, and does not constitute financial, legal, or investment advice.)