[Updated with first-day trading information, 1pm, 8/12/15.] The biotech bull run rolls on. Halfway through its first day of trading Wednesday, Global Blood Therapeutics has nearly doubled its share price, which for now makes the four-year-old company worth more than $1 billion.
The firm sold 6 million shares at $20 each to raise $120 million in its initial public offering Tuesday, despite having the barest of clinical information about its lead product, a chronic treatment for sickle cell disease.
As of the end of July, only eight people with sickle cell had taken the drug. But if it works, it could be a significant new option to reverse the course of the genetically inherited disease. To date, sickle cell disease, or SCD, can only be cured through extremely risky bone marrow transplants. With drugs, doctors can only treat the symptoms, which include bouts of extreme pain, anemia, infections, lung damage, stroke, and more.
The disease, from a single genetic mutation, causes red blood cells, our bodies’ oxygen carriers that are usually round and healthy, to stiffen and curl. The malformed cells clump up and block blood flow, which also decreases oxygen delivery to tissues and organs.
About 100,000 Americans, mainly of African descent, have the disease, according to the National Institutes of Health.
Because of its genetic nature, the disease is among the first to be explored with gene therapy, with intriguing early results in a single patient coming earlier this year from Bluebird Bio (NASDAQ: [[ticker:BLUE]]). (Global Blood’s major backer, Third Rock Ventures, was also a key venture backer of Bluebird.)
But Global Blood, of South San Francisco, CA, is developing a more conventional once-a-day pill to be taken for life. Its drug GBT440 is in the middle of Phase 1/2 testing on both healthy volunteers and sickle cell patients. The trial began earlier this year and will grow to include as many as 128 people.
As of July 31, Global Blood had enrolled 48 people in its trial; 40 are healthy volunteers and eight have SCD. So far there have been no serious side effects among the 36 people receiving GBT-440 for either two or four weeks (the other 12 have received placebo).
According to the company, all six SCD patients receiving multiple doses of the drug over four weeks have seen a “significant reduction” in the count of sickled red blood cells, and the company also reports improvements in other markers of the disease.
That’s a good start, but the drug is meant to be taken chronically. With its participants on the drug so far for four weeks, at most, and with at least 48 more people due to be tested, the trial will have to continue to provide a strong safety profile. As Global Blood itself notes in its filings, earlier drugs of GBT440’s type—known as hemoglobin modifiers—have started out well in the clinic, but later on have exhibited safety problems that were dire enough to force an end to the trials.
GBT440 binds to hemoglobin and helps it absorb oxygen, which in turn prevents the sickling of red blood cells. One challenge is to create oxygenated hemoglobin without starving the patient’s body of oxygen, a condition known as hypoxia. Global Blood intends to expand the drug into other indications, including idiopathic pulmonary fibrosis. It also is developing other small-molecule drugs to treat hereditary angioedema, an extremely rare disease that involves unexpected swelling.
The company’s original investor, Third Rock, owns 63 percent of Global Blood. The only other shareholder with more than 5 percent ownership is Fidelity, with a 13 percent stake.
Other Third Rock portfolio companies that have gone public during the long biotech bull run are Bluebird, Agios Pharmaceuticals (NASDAQ: [[ticker:AGIO]]), Sage Therapeutics (NASDAQ: [[ticker:SAGE]]), Blueprint Medicines (NASDAQ: [[ticker:BPMC]]), Eleven Biotherapeutics (NASDAQ: [[ticker:EBIO]]), Zafgen (NASDAQ: [[ticker:ZFGN]]), and Foundation Medicine (NASDAQ: [[ticker:FMI]]).
The company’s $20 IPO price bested the $16 to $18 per share range it had projected before the offering. Morgan Stanley and Goldman Sachs ran the IPO, and the underwriters have the option to sell up to 900,000 more shares in the next 30 days.
Image courtesy of Scooter DMU via a Creative Commons license.
