The IPO Buzz: Biotech Septerna Prices Upsized IPO at $18 & Raises $288 Million

Septerna Inc. (SEPN), a thyroid-focused Phase I biotech, upsized its IPO at pricing to 16.0 million shares – up from 15.28 million shares in the recently upsized prospectus – and priced the IPO at $18.00 – as planned – to raise $288.0 million on Thursday night, Oct. 24, 2024. Septerna’s stock is expected to start trading today – Friday, Oct. 25, 2024 – on the NASDAQ. J.P. Morgan, TD Cowen, Cantor and Wells Fargo Securities were the joint book-runners. The market cap – at pricing – was $756.05 million. Septerna’s IPO was increased in size twice in the same day – first, in an S-1/A filing early Thursday morning – and again at pricing. The IPO’s original terms, disclosed in an S-1/A filing on Monday, Oct. 21, 2024, called for 10.94 million shares (10,937,500 shares) to be sold at a price range of $15.00 to $17.00 to raise $175.0 million. Septerna upsized the IPO to 15.28 million shares (15,277,778 shares) – at an assumed IPO price of $18.00 – $1.00 above the top of its original price range – in an S-1/A filing dated Oct. 24, 2024 – filed early on the morning of its IPO pricing day. The IPO was priced on Thursday night. “What you’re seeing is the demand. Get what you can,” a veteran IPO pro said Thursday, after Septerna’s upsized terms were disclosed. Gold-Plated Backers Septerna, a Phase I biotech with only one drug candidate – a thyroid-disease drug – in a clinical trial, has no licensing or collaboration deals, according to the prospectus. But it does have top-tier backers – through their various entities – the prospectus said: *Third Rock Ventures, a major healthcare VC firm, had a pre-IPO stake of 33.5 percent that would go to a post-IPO stake of 21.1 percent; *RA Capital, a prominent biotech investment firm, had a pre-IPO stake of 10.9 percent that would go to a post-IPO stake of 6.8 percent, and *Goldman Sachs had a pre-IPO stake of 5.4 percent that would go to a post-IPO stake of 3.4 percent. Testing a Drug Candidate for Low PTH Septerna, based in San Francisco, is evaluating a new drug candidate, SEP-876, in a Phase I clinical trial to treat hypoparathyroidism, a rare endocrine disease caused by low levels of the parathyroid hormone (PTH), according to the prospectus. SEP-876 is an oral small molecule agonist targeting PTH1R – parathyroid hormone 1 receptor (PTH1R). Septerna plans to report data from this clinical trial in mid-2025. Septerna has another drug candidate in IND-enabling studies: SEP-631, an oral small molecule MRGPRX2 negative allosteric modulator (NAM) to treat a painful inflammatory skin disease called chronic spontaneous urticaria (CSU). Septerna is developing a preclinical TSHR (thyroid stimulating hormone receptor) program to treat Graves’ disease and thyroid eye disease (TED), the prospectus said. Graves’ disease, the leading cause of hyperthyroidism, affects over 2 million patients in the U.S.  In about 50 percent of Graves’ disease patients, the illness progresses to thyroid eye disease (TED), a vision-threatening autoimmune condition that can lead to eye bulging, swelling, pain and blurred or double vision. Like most biotechs when they go public, Septerna has red ink on its bottom line and minimal revenue. For the 12 months that ended June 30, 2024, Septerna reported a net loss of $46.2 million on revenue of about $0.84 million ($840,000). (For more information about these companies, please check the IPO Calendar and the individual IPO Profiles found on the IPOScoop.com  website.) Note: Never trade on proposed symbols. They have been known to change and you might buy something on the OTC Bulletin Board. To see what time the NASDAQ IPOs are expected to trade, please log in to: NASDAQTrader.com then scroll down to IPO Message. Disclosure: Nobody on the IPOScoop.com staff has a position in any stocks mentioned above, nor do they trade or invest in IPOs. The IPOScoop.com staff does not issue advice, recommendations or opinions. Disclaimer: A SCOOP Rating (Wall Street Consensus of Opening-day Premiums) is a general consensus taken, at press time, from Wall Street and investment professionals concerning how well an IPO might perform when it starts trading. The SCOOP Rating does not reflect the opinions of anyone associated with IPOScoop.com. The SCOOP ratings should not be taken as investment advice. The rating merely reflects the opinion of the professionals at the time of publication and is subject to last-minute changes due to market conditions, changes in a specific offering and other factors, such as changes in the proposed offering terms and the shifting of investor interest in the IPO. The information offered is taken from sources we believe to be reliable, but we cannot guarantee the accuracy.