IPO activity has started to pick up steam after falling sharply in the first half in line with the global trend, but is unlikely to match last year’s record highs. While the recovery is being led by financial and health technology companies, a full recovery appears to be a long way off. Among the most recent among the major IPO contenders to file filings with the SEC is Third Harmonic Bio, a clinical-stage healthcare company that offers oral KIT inhibitors to treat severe allergies and inflammation.
The offer
It’s worth noting that not many biopharmaceutical companies have gone public this year. Third Harmonic intends to raise approximately $150 million through the sale of common stock in an initial public offering. The underwriting team is led by Morgan Stanley. Management will disclose the scope of the offering and price in future filings. The company has applied to list on the Nasdaq Global Market under the symbol THRD.
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The company, currently led by Natalie Holles, who has served as Chief Executive Officer for more than a year, was founded in 2019 by venture capital firm Atlas Venture. The Cambridge-based company is focused on the advancement of the intellectual property licensed by Novartis AG (NYSE: NVS), which is part of its consortium of investors.
The net proceeds from the offering will be used primarily for the development of THB001 across multiple indications – Third Harmonic’s lead candidate for the treatment of skin and respiratory diseases – and to expand the remainder of the pipeline, in addition to general research and development activities.
pipeline
The company’s long-term prospects would be influenced in large part by results from early studies of THB001. Several studies of the formulation are currently underway – pre-clinical and phase 1 – for diseases such as chronic inducible urticaria, chronic spontaneous urticaria and asthma. First results from the phase 1b study in chronic inducible urticaria are expected in the second half of 2023.
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Once successfully developed, these treatments are expected to find a large market and steadily expand over the years. Meanwhile, like most clinical-stage biopharmaceutical companies, the company hasn’t generated any revenue for the six months ended June 2022. A net loss of $15.46 million was incurred, primarily due to costs related to research and development.
road ahead
Going forward, competition from industry leaders like Johnson & Johnson (NYSE: JNJ) and relatively smaller players like Teva Pharmaceutical Industries Ltd (NYSE: TEVA) would pose a significant challenge for the company. On a positive note, the global market for therapies for various types of urticaria is estimated to grow at approximately 10% annually through 2026. That should give all players enough room to grow.
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