Two withdrawals of recently submitted initial public offering (IPO) filings by drug developers, plus a dearth of new filings this month, suggest that the outlook for biopharma IPOs remains cloudy, complicated by factors that include share price declines for some recent offerings and the ongoing war in Iran and the broader Middle East.
Invea Therapeutics, a developer of oral small molecule drugs for inflammatory diseases, cited market conditions earlier this month in withdrawing the planned IPO for which it filed on December 15, more than two years after first filing, then withdrawing its first S-1 registration statement with the U.S. Securities and Exchange Commission (SEC).
Invea had planned to list its shares on NASDAQ under the ticker symbol INAI, and raise about $35 million in gross proceeds by offering 3.2 million shares at between $10 and $12 a share. According to its most recent preliminary prospectus, filed January 27, the largest share of its proceeds—about $15 million—was to advance the development of lead product candidate INVA8001, including the launch of a Phase IIa trial and expected data readout for chronic inducible urticaria, subject to a clinical trial application filing and regulatory clearance. Future plans call for expanding the development of INVA8001 into chronic spontaneous urticaria.
“The grounds for this application for withdrawal are that, due to current market conditions, the registrant has determined not to pursue the public offering to which the registration statement relates at this time,” Invea stated in a regulatory filing.
A week earlier, Edison Oncology, a developer of small molecule cancer therapies, withdrew plans it first filed last November, and last updated in January, to raise about $25 million through an offering in which the company planned to sell 2.8 million shares at between $8 and $10 a share. Edison had planned to list its shares on the NYSE American exchange under the ticker symbol EOHC.
Edison disclosed no reason for the withdrawal of its application filing on February 27. According to its most recent preliminary prospectus dated January 16, the largest portion of its proceeds ($3.95 million) was earmarked for manufacturing, a Phase I/IIa clinical trial, and supportive nonclinical research for EO4426 (tezacitabine), an oral, brain-penetrating small molecule inhibitor of DNA polymerase alpha (Pol α) and ribonucleotide reductase (RNR) that is designed to treat aggressive, recurrent solid tumors and blood cancers.
That same day, Generate: Biomedicines (NASDAQ: GENB) finished its first day of public trading after raising $400 million in gross proceeds with its stock closing at $12.65, sliding 21% from its IPO price of $16 on a day in which the broader financial markets plummeted on news of a higher-than-expected increase during January in the “core” producer price index (PPI), which excludes food and energy prices. Since then, Generate’s shares have bounced back 3%, closing Friday at $13.08, for an overall 18% decline since going public.
Generate’s IPO stoked optimism among market watchers earlier this year that the market for first-time public stocks was finally set to recover this year, following several bumpy years that followed the COVID-19 pandemic-induced surge of public companies. Generate is one of six biotechs to have launched IPOs on U.S. public markets so far this year—all of them in January or February. Two other newly public companies have seen their share prices fall since launching their IPOs:
- Eikon Therapeutics (NASDAQ: EIKN)—The late-stage oncology and neuroscience drug developer’s shares have seen the biggest post-IPO drop, tumbling 36% from the initial price of $18 to $11.46 at Friday’s close.
- Agomab Therapeutics (NASDAQ: AGMB)—Shares of the immunology and inflammatory disease drug developer have fallen 13% from the IPO price of $16 to $13.85 as of Friday.
The other three IPO companies launching this year have seen their share prices rise. The biggest winner so far has been Veradermics (NYSE: MANE), a developer of treatments for dermatology and aesthetic conditions, which closed Friday at $52.80, up more than triple (211%) from its IPO price of $17 a share.
One apparent reason for the surge: Investors appear to agree with Veradermics execs who see a potentially expanded market for the company’s lead pipeline candidate VDPHL01, an extended-release oral version of minoxidil being developed to treat pattern hair loss—namely developers of obesity drugs looking to offer their patients a treatment that addresses the loss of hair that has been among side effects of glucagon-like peptide 1 (GLP-1) receptor agonists.
Veradermics is set to read out topline six-month data later in the first half of this year from its Study 302, a Phase II/III study (NCT06724614) designed to assess VDPHL01 in men with pattern hair loss.
“Mgmt expressed high conviction on Ph3 success and flagged a broader-than-expected strategic landscape including obesity drugmakers and consumer aesthetics players,” Jefferies equity analyst Roger Song, MD, wrote Thursday in a research note based on a meeting with Veradermics execs held during the recent 2026 Jefferies Biotech on the Beach Summit, held in Miami. “GLP‑1–induced hair loss at sufficient weight loss creates a commercial rationale for obesity drugmakers to offer a hair regrowth solution.”
Also seeing share price gains so far this year as of Friday are SpyGlass Pharma (NASDAQ: SGP), which has soared 66% from its IPO price of $16 to $26.55; and Aktis Oncology (NASDAQ: AKTS), whose stock has climbed 19% in price from $16 in its IPO to $18.99.
Generate remains fortunate to have priced the year’s biggest IPO to date, raising $400 million in gross proceeds toward clinical trials, as well as platform and pipeline R&D efforts, through its oversubscribed IPO offering of 25 million shares at $16 a share. And even more fortunate to have carried out that IPO a day before the start of the ongoing war against Iran by U.S. and Israeli forces.
The war has touched off volatility across markets, including biotech, where the top two exchange traded funds (ETFs) have seen their share prices fall in the three weeks since hostilities broke out on February 28.
The top biotech-focused ETF with $8.363 billion in assets according to VettaFi, iShares Biotechnology ETF (NASDAQ: IBB), has slipped about 6% from $175.37 on February 27, the day before the war began, to $165.51 at Friday’s closing bell. SPDR S&P Biotech ETF (NYSE Arca: XBI), the second-largest biotech fund with $8.031 billion in assets, has dipped 4.3%, from $127.37 to $121.83 on Friday.
The third-biggest biotech ETF, First Trust NYSE Arca Biotechnology Index Fund (NYSE Arca: FBT), which has $2.282 billion in assets, fell nearly 8% from $208.69 to $192.63 on Friday.
A positive sign for the biotech IPO market emerged on Friday, as Bloomberg News reported that privately held Leo Pharma had invited investment firms to compete for overseeing a planned IPO by the Danish dermatological drug developer. A Leo spokesman quoted in the report offered no comment but cited past statements that the company was preparing for a possible future first-time public stock sale.
Analysts positive on Korro’s new lead candidate
Four months after Korro Bio (NASDAQ: KRRO) shares crashed 81% on clinical data showing its previous lead candidate KRRO-110 did not reach projected levels of functional protein in alpha-1 antitrypsin deficiency (AATD) patients following a single administration, the company is preparing to advance KRRO-121 into the clinic, with two analysts offering positive comments about the new lead pipeline candidate and its potential for success.
The analyst comments sparked an 11% surge in Korro’s stock, which rose Friday from $11.50 to $12.80, capping a week that saw the stock rise 14.5%.
KRRO-121 is a preclinical GalNAc-conjugated, RNA-editing oligonucleotide that is designed to treat hyperammonemia in patients with urea cycle disorders (UCDs) and hepatic encephalopathy (HE). Through GalNAc-conjugation, Korro reasons, KRRO-121 can be brought directly to hepatocytes, where KRRO-121 is engineered to edit glutamine synthase (GS) RNA to create a de novo variant of GS protein with a single amino acid change.
The de novo protein prevents glutamine-induced proteasomal degradation of GS, creating a compensating protein through a synthetic rescue approach rather than repairing a specific mutation of an enzyme involved in the urea cycle. KRRO-121 is a potential first-in-class therapy for two diseases with unmet medical needs.
During a presentation at Korro’s Analyst Day on January 27, COO Todd Chappell said UCDs represented a $1.5 billion market opportunity based on 4,200 severe late-onset UCD addressable patients in the United States and 5,100 in the U.K. and European Union. HE is a potentially more than $2 billion market opportunity based on 80,000 U.S. patients and 150,000 in the E.U. and U.K.
“We view the potential TAM [total addressable market] here (pan urea cycle disorder population plus hepatic encephalopathy) as meaningful (current estimated peak sales of $2.3 billion),” Myles R. Minter, PhD, a partner and biotechnology analyst with William Blair, wrote Friday in a research note.
“Intriguing” data
Minter added that preclinical data presented by the company earlier this year during an analyst day event were “intriguing, particularly if glutamine levels can remain steady in urea-cycle-deficient patients in the absence of scavenger therapy [Ravicti/Buphenyl) over the longer term and ammonia normal,” Minter added.
Ravicti (glycerol phenylbutyrate) and Buphenyl (sodium phenylbutyrate) are indicated for chronic management of patients with UCDs. Though generic versions are available, Amgen markets the brand-name versions of both drugs.
In reporting fourth-quarter and full-year 2025 results on Thursday, Korro said it plans to submit a regulatory filing to advance KRRO-121 into the clinic in the second half of 2026.
“We are increasingly excited about KRRO-121, given the unique MoA [mechanism of action], relatively low regulatory bar, and large commercial opportunity in UCD/HE,” Kostas Biliouris, PhD, a managing director on the biotechnology research team of Oppenheimer, wrote Friday in a research note.
Korro is enthused enough about GalNAc conjugation to plan for developing two additional programs incorporating GalNAc-conjugated delivery. One is an ATTD treatment program, for which the company plans to nominate a development candidate during the second quarter—reflecting a pivot from KRRO-110 and its RNA editing approach, which used a lipid nanoparticle (LNP) to deliver an oligonucleotide to liver cells. The other is a longevity and liver health program consisting of a GalNAc-conjugated oligonucleotide designed to improve liver function and restore metabolic signaling by activating hepatic AMPKγ1.
Korro plans to advance the longevity program, plus clinical development milestones for KRRO-121 and the GalNAc-conjugated AATD program, using proceeds from the approximately $85 million private investment in public equity (PIPE) financing announced March 9. That financing, plus Korro’s $85.2 million in unaudited cash, cash equivalents, and marketable securities as of December 31, 2025, has extended the company’s cash runway into the second half of 2028.
Korro has emphasized that KRRO-110 did generate functional M-AAT protein in AATD patients in the Phase I/IIa REWRITE clinical trial (NCT06677307), but not as much as had been projected following preclinical studies. And not as much as was achieved in clinical trials for competing AATD therapy candidates by two rival developers, Wave Life Sciences (NASDAQ; WVE) and Beam Therapeutics (NASDAQ: BEAM).
But the clinical setback led to a post-REWRITE restructuring that shrunk Korro’s workforce by 34%, on top of a 19% reduction of its staff in May 2025. According to its latest Form 10-K annual report filed Thursday, Korro had 58 employees at the end of 2025, down 44% from the 104-person workforce it reported a year earlier.
Leaders and laggards
- BioNTech (NASDAQ: BNTX) shares slid 18% from $102.16 to $83.89 Tuesday after the mRNA-based immunotherapy and vaccine developer said its co-founders—CEO Prof. Ugur Sahin, MD, and chief medical officer Özlem Türeci, MD—will leave the company by year’s end to establish an independent company focused on “next-generation mRNA innovations.” The unexpected managerial transition came in addition to revenue guidance for 2026 that fell below analyst expectations, as BioNTech projected revenues this year will range between €2 billion and €2.3 billion ($2.3 billion and about $2.7 billion). The midpoint of the guidance (€2.15 billion) would be 7% below BioNTech’s 2025 revenue of €2.3 billion, excluding €613 million ($712 million) in one-time upfront and anniversary payments from its cancer collaboration with Bristol Myers Squibb (NYSE: BMY). “If BNTX brings in the right successor that can improve communication & focus on clinical/commercial execution, this could be +’ve LT [long-term],” Jefferies equity analyst Akash Tewari wrote.
- Incannex Health (NASDAQ: IXHL) shares nosedived 48% from $5.97 to $3.08 Thursday after the developer of cannabinoid-based medicines and psychedelic-based regimens for chronic conditions said it agreed to sell two million shares of its common stock (or equivalents) plus warrants to buy up to another two million shares at a combined price of $5 per share and accompanying warrant, under a securities purchase agreement with healthcare-dedicated institutional investors. The registered direct offering is designed to raise at least $10 million, which could rise to $23 million if investors fully exercise the warrants. The registered direct offering is designed to finance a planned Phase II DReAMzz crossover dose-optimization study assessing its lead clinical program, the oral obstructive sleep apnea candidate IHL-42X. Incannex plans to use cash on hand to fund a streamlined Phase III clinical program for the drug, now expected to start in the second half of 2027.
- MiNK Therapeutics (NASDAQ: INKT) shares jumped 29% from $10.45 to $13.51 Tuesday after the developer of allogeneic, off-the-shelf invariant natural killer T (iNKT) cell therapies announced a collaboration with C-Further, an international pediatric oncology therapeutics consortium, to develop a TCR-engineered iNKT cell therapy for pediatric cancers that would target preferentially expressed antigen in melanoma (PRAME), a tumor-associated antigen expressed across multiple pediatric and adult cancers with limited expression in healthy tissues. MiNK and the consortium aim to enable precise tumor targeting while activating coordinated immune responses within the tumor microenvironment by combining PRAME-specific antigen recognition with MiNK’s iNKT cell platform. C-Further agreed to spend approximately $1.1 million in non-dilutive, aggregate funding to support IND-enabling development of PRAME-TCR-iNKT and give MiNK a “meaningful” double-digit share of downstream commercial revenues. The collaboration is nonexclusive, allowing MiNK to continue advancing its iNKT platform independently and pursue tumor antigen targets across oncology indications and partnerships.
The post StockWatch: Withdrawals, Share Prices Suggest a Still-Cloudy Outlook for IPOs appeared first on GEN – Genetic Engineering and Biotechnology News.
