IPO Preview: Freeline Therapeutics Seeks $100 Million U.S. IPO
Freeline Therapeutics Holdings plc (FRLN) intends to raise $100 million in an IPO of its ADSs representing underlying ordinary shares, according to an F-1 registration statement.
The company is a gene therapy biopharma developing treatments for hemophilia B and other serious systemic diseases.
FRLN has produced enviable early Phase 1 / 2 trials results for its lead candidate for the treatment of Hemophilia B.
I look forward to learning more about the IPO in future filings.
Hertfordshire, UK-based Freeline was founded to develop its AAV-based gene therapy technologies for the treatment of various lysosomal storage disorders, Fabry disease and Gaucher disease.
Management is led by Chief Executive Officer Theresa Heggie, who has been with the firm since June 2020 and was previously SVP, Head of CEMEA at Alnylam Pharmaceuticals and held roles at Bupa Group and Shire plc.
Below is a brief overview video of AAV-based gene therapy:
The firm's lead candidate, FLT180a, is in Phase 1/2 trials for the treatment of severe hemophilia B, which causes abnormal clotting of blood.
To-date, the company has 'reported clinical trial results demonstrating FIX activity levels well into the clinically normal FIX activity level range of 50% to 150%.'
Below is the current status of the company’s drug development pipeline:
Source: Company S-1 Filing
Investors in the firm have invested at least $207.6 million and include Syncona Portfolio and Novo Holdings.
According to a 2020 market research report by Grand View Research, the global market for hemophilia treatment is expected to reach a value of $17 billion by the end of 2027.
This represents a forecast CAGR (Compound Annual Growth Rate) of 5.5% from 2020 to 2027.
Key elements driving this expected growth are an expected increase in bleeding disorders as well as a growing awareness of treatment options.
Also, below is a chart showing the historical and future expected growth rates of hemophilia treatments in the U.S.:
The North America region contributed more than 44.4% of the total revenue share, but the Asia Pacific region is expected to see the fastest growth in demand for treatment through 2027.
Major competitive vendors that provide or are developing treatments include:
- BioMarin (BMRN)
- 4D Molecular Therapeutics (DDDD)
- Sangamo (SGMO)
- Takeda Pharmaceuticals (TAK)
- Spark Therapeutics
- uniQure (QURE)
Freeline’s recent financial results are typical of a development stage biopharma in that they feature no revenue and significant R&D and G&A expenses associated with advancing its programs.
Below are the company’s financial results for the past two calendar years:
Source: Company registration statement
As of December 31, 2019, the company had $73.7 million in cash and $12.4 million in total liabilities. (Unaudited, interim)
Freeline intends to raise $100 million in gross proceeds from an IPO of its ADSs representing underlying ordinary shares, although the final amount may be different.
No existing shareholders have indicated an interest to purchase shares at the IPO price, although this element may become a feature of the IPO if disclosed in a future filing.
Management says it will use the net proceeds from the IPO as follows:
to fund further clinical and CMC development of our product candidates, including the completion of our ongoing Phase 1/2 B-AMAZE clinical trial of our lead product candidate, FLT180a, and completion of our ongoing Phase 1/2 MARVEL-1 clinical trial of FLT190, as well as the development of our preclinical programs; and
the balance for other general corporate purposes, including general and administrative expenses and working capital.
Management’s presentation of the company roadshow is not available.
Listed bookrunners of the IPO are J.P. Morgan, Morgan Stanley, Evercore ISI and Wedbush PacGrow.
Freeline is seeking a slightly higher than usual life science IPO transaction size to continue development of its pipeline of treatments.
The firm’s lead candidate for the treatment of Hemophilia B has shown strong results in its early Phase 1/2 trials.
The market opportunity for treating hemophilia is significant and expected to grow at a moderately strong rate in the coming years.
Management has disclosed no research or commercial collaborations, so is pursuing a ‘go-it-alone’ approach, at least so far.
The company’s investor syndicate includes Novo Holdings, a group within the Novo Nordisk Foundation’s family of global funds. Novo is a well regarded life science investor.
J.P. Morgan is the lead left underwriter and IPOs led by the firm over the last 12-month period have generated an average return of 79.4% since their IPO. This is a top-tier performance for all major underwriters during the period.
FRLN has produced very promising results for its lead candidate, so I look forward to learning more about the IPO’s pricing and valuation assumptions.
Expected IPO Pricing Date: To be announced.
(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. IPO stocks can be very volatile in the days immediately after an IPO. Information provided is for educational purposes only, may be in error, incomplete or out of date, and does not constitute financial, legal, or investment advice.)
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