San Diego’s Trius Therapeutics, like Zogenix and Pacira Pharmaceuticals, was among the local IPOs that got caught in the jaws of the amazing life sciences valuation-shrinking machine of 2010.
Trius initially filed its IPO in late 2009 to raise as much as $86 million by March 2010, so the company could price its shares in time to fund its planned Phase 3 clinical trials of torezolid phosphate, a promising antibiotic for treating acute, methicillin-resistant skin infections. Torezolid is the company’s lead drug candidate, and as Trius CEO Jeff Stein told me recently, the company was working on its IPO and finalizing the protocols for its late-stage clinical trials at roughly the same time.
As fate would have it, though, the FDA decided in late February to change its guidelines for such studies—necessitating a substantial overhaul of the company’s application for a special protocol assessment (SPA). The SPA process is designed to serve as a kind of roadmap for both the company and federal drug regulators, and sets out how data from the trial can be used as the primary basis for a new drug application.
Reaching an agreement on the revised protocols took until mid-June, forcing the company to delay its IPO into what Stein called the summer doldrums. Stein says Trius didn’t want to postpone the IPO any further, as the company needed the capital to fund the planned clinical trials. Trius also is on a tight timeline for launching the new drug, which was tied to other steps in the company’s overall strategy.
“We made the right decision,” Stein said. “The fact that we got it done at all is a testament to the strength of the [torezolid] story, the quality of our management team, and everything else.”
The company paid a price, though, when underwriters chopped the price and increased the number of Trius shares, leading the company to generate about $30 million less than expected in its IPO. Instead of generating close to $80 million, Trius raised
