IPO Preview: Inventiva SA Begins U.S. IPO Plan

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Inventiva S.A. (IVA) intends to raise $90 million in an IPO of its ADSs representing ordinary shares, according to an F-1 registration statement.

The firm is a clinical stage biopharma developing treatments for NASH (non alcoholic steato hepatitis), MPS (mucopolysaccharidoses) and other diseases.

IVA is preparing to enter Phase 3 trials for its lead candidate for the treatment of NASH.

I’ll provide an update when we learn more about the IPO from management.

Daix, France-based Inventiva was founded to advance a pipeline of treatment candidates for various disease conditions including NASH and MPS.

Management is led by co-founder, Chairman and CEO Frederic Cren, who was previously General Manager, Research of Abbott Laboratories (ABT) and held roles at Solvay Pharmaceuticals.

Below is a brief overview video of Inventiva's IPO in France (in French):

Source: Boursorama

The firm's lead candidate is called Lanifibranor and is in Phase 2 trials for the treatment of NASH.

Management expects to have formal meetings at the end of its Phase 2b trials some time in Q4 2020.

The firm released topline results, which said, in part:

In this trial, treatment with lanifibranor at a dose of 1,200 mg met the primary endpoint of a reduction in inflammation and ballooning with no worsening of fibrosis after 24 weeks of treatment, while continuing to show the favorable tolerability profile observed in prior clinical trials of lanifibranor. Treatment with lanifibranor at doses of 800 mg and 1,200 mg also met the key secondary endpoints of resolution of NASH with no worsening of fibrosis and, at the 1,200 mg dose, of improvement in liver fibrosis without worsening NASH, which are the primary endpoints relevant for seeking accelerated approval from the U.S. Food and Drug Administration, or FDA, and the European Medical Agency, or EMA, after future Phase III development.

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

inventivapipe

Source: Company S-1 Filing

Investors in the firm have invested at least $100 million and include BVF Partners, Frederic Cren, New Enterprise Associates, Pierre Broqua, Novo Holdings, and Sofinnova.

According to a 2018 market research report by Allied Market Research, the global market for NASH treatments was valued at $1.2 billion in 2017 and is expected to reach $21.5 billion by 2025.

This represents a forecast CAGR (Compound Annual Growth Rate) of 58.4% from 2021 to 2025.

Key elements driving this expected growth are a surge in the incidence of diabetes resulting in greater risk of obtaining NASH as well as sharply increased development of treatment options amid greater awareness of the disease and its potential treatments.

Also, a breakdown of the different drug types used to treat NASH is shown below:

inventivamkt

Major competitive vendors that provide or are developing treatments include:

  • Allergan
  • Galmed Pharmaceuticals (GLMD)
  • Madrigal Pharmaceuticals (MDGL)
  • Gilead Sciences (GILD)
  • BioMarin (BMRN)
  • Numerous other companies

Inventiva’s recent financial results are atypical of a development stage biopharma, in that they feature some revenue but are also typical in terms of significant R&D and G&A expenses associated with advancing its pipeline.

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

inventivapl

Source: Company registration statement

As of March 31, 2020, the company had $52.6 million in cash and $17.7 million in total liabilities. (Unaudited, interim)

Inventiva intends to raise $90 million in gross proceeds from an IPO of its ADSs representing ordinary shares, although the final amount may be different.

No existing shareholders have indicated an interest to purchase shares at the IPO price. The firm is currently listed on the Paris, France stock exchange under the ticker symbol “IVA.”

Management says it will use the net proceeds from the IPO ‘to complete preparations for and initiate a Phase III clinical trial of lanifibranor for the treatment of patients with NASH; to complete our planned Phase Ib/II clinical trial of odiparcil in a pediatric population with MPS VI, to advance development of our Hippo pathway signaling program and other pre-clinical programs; and the balance for working capital and general corporate purposes.'

Management’s presentation of the company roadshow is not available.

Listed bookrunners of the IPO are Jefferies, Stifel, Guggenheim Securities, H.C. Wainwright & Co., Roth Capital Partners and KBC Securities.

Commentary

Inventiva is seeking U.S. funding for its Phase 3 trials of its lead candidate, lanifibranor.

Management expects to have further meetings about the Phase 3 trial endpoints and other matters by the end of 2020.

It is likely that we won’t hear initial Phase 3 trial results until well into 2022.

The market opportunity for treating NASH is large and expected to grow at an enormous rate, and there are numerous biopharma firms of all sizes working on treatment options, so the firm will have significant competition in the market.

Management has disclosed no research or commercial collaborations as of the current date.

Jefferies is the lead left underwriter and IPOs led by the firm over the last 12-month period have generated an average return of 133.0% since their IPO. This is a top-tier performance for all major underwriters during the period.

As a reference, IVA is listed on the Euronext Paris exchange with a current market capitalization of $362 million.

Inventiva has produced promising results in its trial activities so far, so I look forward to learning about management’s assumptions on pricing and valuation for the IPO.

Expected IPO Pricing Date: To be announced.

Glossary Of Terms

(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 incomplete or out of date, and does not constitute financial, legal, or investment advice.)

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