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A brief introduction to PepGen
PepGen (PEPG) has filed to raise an undisclosed amount in an initial public offering of its common stock, according to an S-1 registration statement.
The Company is a clinical-stage biopharmaceutical company developing treatment candidates for various forms of muscular dystrophy.
When we get more information about the IPO from management, I will make a final statement.
Company & Technology
Based in Cambridge, Massachusetts, PepGen was formed to develop treatments for multiple types of muscular dystrophy using its Enhanced Delivery Oligonucleotide platform to improve uptake and activity of conjugated oligonucleotide therapeutics.
Management is led by President and CEO James McArthur, Ph.D. who has been with the company since January 2021 and previously co-founded Imara, a clinical-stage biopharmaceutical company, and founded Vtesse, a pharmaceutical company acquired by Sucampo.
The Company’s lead candidate, PGN-EDO51, is in Phase 1 studies for the treatment of Duchenne muscular dystrophy (exon 51) and management expects top-line clinical data by the end of 2022.
Below is the current status of the Company’s drug development pipeline:
Corporate Pipeline (SEC EDGAR)
PepGen has booked a fair market value investment of $165.2 million as of December 31, 2021 from investors including RA Capital, Oxford Science Enterprises and KAVRA 16 LLC.
PepGen’s Market and Competition
According to a 2018 market research report by Grand View Research, the global Duchenne muscular dystrophy market is expected to reach $4.1 billion by 2023.
This equates to a projected CAGR (Compound Annual Growth Rate) of 41.3% from 2018 to 2023.
Key elements driving this anticipated growth are the launch of late-stage drug treatments and gene therapy approaches.
Also, the DMD drug market is expected to gain competitiveness due to delays and rejections of various trial efforts.
Key competing vendors offering or developing related treatments include:
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PTC Therapeutics (PTCT)
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Sarepta Therapeutics (SRPT)
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Nippon Shinyaku Co. (OTC: NPNKF)
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Avidity Life Sciences (RNA)
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Dyne Therapeutics (DYN)
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BioMarin Pharmaceutical (BMRN)
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Pfizer (PFE)
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Audentes Therapeutics
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Solid Life Sciences (SLDB)
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Wave Life Sciences (WVE)
Financial status of PepGen
The company’s recent financial results are typical of a clinical-stage biopharmaceutical company as they show no revenue and material R&D and G&A expenses related to its pipeline development efforts.
Below are the Company’s financial results for the last two calendar years:
Profit and Loss Account (SEC EDGAR)
As of December 31, 2021, the Company had $133 million in cash and $10.5 million in total debt.
PepGen IPO Details
PepGen intends to raise undisclosed gross proceeds from an initial public offering of its common stock.
No existing shareholder has expressed an interest in buying shares at the IPO price.
Management says it will use the net proceeds from the IPO as follows:
to further develop our PGN-EDO51 program
to further develop our PGN-EDODM1 program
to further develop our PGN-EDO53 program
to further develop our programs PGN-EDO45 and PGN-EDO44
to further develop our pipeline and platform
the remaining proceeds for working capital and other general corporate purposes.
(Source)
Management’s presentation of the company’s roadshow is not available.
With respect to pending legal proceedings, management says that the Company is not involved in any legal proceedings that it believes would have a material adverse effect on its financial condition or operations.
Listed bookrunners for the IPO are BofA Securities, SVB Leerink, Stifel and Wedbush PacGrow.
Commentary on PepGen’s IPO
PEPG is seeking public capital market funding to advance its enhanced delivery oligonucleotide platform for developing treatments for muscular dystrophy.
The Company’s lead candidate, PGN-EDO51, is in Phase 1 studies for the treatment of Duchenne muscular dystrophy (exon 51) and management expects top-line clinical data by the end of 2022.
The market opportunity for the treatment of Duchenne muscular dystrophy and other variants of the disease is significant and is expected to grow significantly in the coming years due to new developments in treatment options.
The DM1 version of the disease affects an estimated 40,000 people in the US, 75,000 in Europe and 15,000 in Japan. It will likely affect many thousands more in China, India and elsewhere.
Management has not announced any collaboration agreements with major pharmaceutical companies.
The Company’s investor syndicate includes RA Capital, a frequent investor in biopharmaceutical companies.
BofA Securities is the leading underwriter and the IPOs it has managed over the past 12 months have generated an average negative return (18.1%) since its IPO. This is a lower performance for all major underwriters over the period.
When we learn management’s assumptions about pricing and valuation of IPOs, I will provide a final opinion.
Estimated IPO Price Date: To be announced.
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