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Bayer and Moderna-backed Metagenomi shares plunge 31% in Friday's stock market debut

Pictured: Nasdaq stock exchange headquarters in New York City/iStock, JHVEPhoto

Metagenomi shares fell 31% on Friday afternoon in a disappointing debut on the Nasdaq Global Select Market, highlighting the potential dangers for preclinical biotech companies seeking an IPO, according to Seeking Alpha.

The company's shares opened at $10.25 per share, while its initial public offering (IPO) price was $15 apiece. Shares of Metagenomi rose to a high of $11.24 per share and fell to a low of $9.80 on Friday.

Last week, Metagenomi announced its initial plans to go public in an $86.9 million initial public offering, selling more than six million common shares at $15 to $17 apiece. The California-based company made its Nasdaq debut a few days later with an IPO priced at the low end of its target range and expecting to raise nearly $93.8 million.

Although Metagenomi joins an impressive class of companies that have gone public this year, it also bucks the trend of IPOs that have raised more money than expected.

At the top is CG Oncology, whose $380 million IPO last month was a huge jump from its original $180 million target. ArriVent followed shortly thereafter with its own offer, increased by $175 million, from $135 million to $156 million. Alto Neuroscience, which went public earlier this month, also saw a larger final outflow of $128.6 million versus the original estimate of $89 million to $103 million.

Kyverna Therapeutics is the latest biotech company to boost its initial public offering, raising gross proceeds of $319 million, compared to its original net income target of $182 million. In Kyverna's Nasdaq debut, the stock rose nearly 60% after the IPO.

The market's lukewarm response to Metagenomi may be due to the fact that there are currently no clinical-stage candidates. Instead, the biotech company is relying on what it calls “the most diverse genome editing toolbox,” which it plans to use to combat a variety of genetic diseases.

According to its website, Metagenomi has developed a comprehensive suite of tools—including base editors, programmable nucleases, and RNA- and DNA-mediated integration systems—that they say can target and target “essentially every codon in the human genome.”

The company's metagenomics-focused approach to treating diseases has attracted several high-profile backers, including Moderna and Bayer, which contributed to the biotech's $275 million Series B raise in January 2023.

Using its toolbox, Metagenomi has developed multiple preclinical and research-stage assets targeting a variety of indications, including hemophilia A, familial amyotrophic lateral sclerosis, Duchenne muscular dystrophy and cystic fibrosis. Additionally, there is a primary hyperoxaluria type 1 program in collaboration with Moderna and a transthyretin amyloidosis candidate in collaboration with Ionis.

Tristan Manalac is an independent science writer based in Metro Manila, Philippines. Contact him on LinkedIn or email him at [email protected] or [email protected].

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