As Total U.S. IPOs Mount, Several Biotech Deals Stumble

With less than six weeks remaining in 2013, the number of U.S. IPOs continues to mount at a rate unseen since the financial meltdown of 2008.

Ten companies are set to go public on U.S. markets this week, according to Renaissance Capital, the IPO investment firm based in Greenwich, CT. That includes Vital Therapies, a San Diego biotech that plans to raise about $75 million to help fund development of artificial liver technology for patients suffering from acute liver failure. (Three other IPOs pending this week are U.S.-based companies, including Vince, the high-end New York apparel designer, while six are foreign-based companies that chose to go public on U.S. markets.)

Demand for new offerings remains strong, even though three life sciences companies (San Diego-based Celladon; Monrovia, CA-based Xencor; and Palo Alto, CA-based CardioDx) postponed their IPOs last week. Another California biotech, Relypsa, raised $75 million last week by offering 6.9 million shares at $11, below the company’s expected price. For some IPO watchers, that’s enough to wonder if investor enthusiasm for biotech IPOs is beginning to wane.

“The IPO market has opened up in 2013 because IPO investors have been making money,” Renaissance co-founder Kathleen Shelton Smith wrote in an e-mail yesterday. And “not just those [institutional investors] that get IPO shares, but for investors who own these stocks in post-IPO trading.”

Smith said the Renaissance IPO ETF (Exchange Traded Fund), which tracks an index of newly public companies (which turn over after two years) is up 46 percent so far this year.

As of yesterday, Renaissance Capital reports that 203 U.S. companies have completed their IPOs in 2013, raising

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Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.