Legend Biotech, a global novel cell therapy spin-off of Hong Kong-listed biotech company GenScript Biotech, has filed for an initial public offering (IPO) on the Nasdaq Stock Exchange.
The company, which first filed confidentially with the US Securities and Exchange Commission (SEC) in March, is still early in the IPO process and has listed a placeholder amount of $100 million.
The IPO application comes less than two months after the company entered into an agreement with investors such as Shanghai-based Lilly Asia Ventures’ (LAV) life science fund LAV Biosciences Fund V, and Johnson & Johnson Innovation (JJDC), a strategic venture capital arm of Johnson & Johnson, to raise about $150.5 million in equity investment.
Under the agreement, Legend Biotech agreed to offer about 19.31 million shares at a price of $7.79 apiece, boosting its post-money valuation to $1.95 billion, GenScript disclosed in a filing with the Hong Kong Stock Exchange (HKEX) on March 31.
Legend Biotech was founded in 2015 by Frank Zhang Fangliang, co-founder and CEO of GenScript, as a subsidiary of the parent company to focus on the research, production and commercialisation of immunotherapy treatments.
GenScript directly owns about 76.9 per cent of the entire issued share capital of Legend Biotech. The company’s stake in Legend Biotech will be reduced as a result of the proposed offering, but GenScript intends to remain Legend Biotech’s majority shareholder after the IPO, said the parent company in a filing on May 14.
Legend Biotech operates as a global, clinical-stage biopharmaceutical company engaged in the discovery and development of novel cell therapies for oncology and other indications. Its lead product candidate, LCAR-B38M/JNJ-4528, is a chimeric antigen receptor, or a CAR-T cell therapy, that it is jointly developing with Johnson & Johnson’s Janssen Biotech for the treatment of multiple myeloma.
It has over 650 employees in the United States, China and Europe.
The firm booked revenues of $57.3 million for the year ended December 31, 2019, while its net losses stood at $2.8 million and $133 million in 2018 and 2019, respectively, according to its prospectus.
Since all its products have yet to be approved for commercial sale, Legend Biotech is expected to incur “significant expenses and operating losses for the foreseeable future” as it devotes all financial resources to the R&D of LCAR-B38M/JNJ-4528 and other CAR-T cell therapy product candidates as well as to building out manufacturing platform, cell therapy technologies and management team.
It will float shares under the symbol “LEGN.” Morgan Stanley, JP Morgan, and New York-based Jefferies are underwriters of the deal.