Austin-based biomedical company Aeglea BioTherapeutics on Monday set the terms for an initial public offering of stock that could raise up to $72 million.
The company, which develops drug therapies to fight cancer, plans to sell as many as 4.03 million shares of common stock at $18 per share, according to a filing with the U.S. Securities and Exchange Commission. The initial offering would be for 3.5 shares, with underwriters eligible to buy an additional 525,000 shares, according to the securities filing.
A date has not yet been set for the offering to commence, according to the securities filing. The company said it plans to trade on the Nasdaq exchange, and to use AGLE as its ticker symbol.
Aeglea BioTherapeutics estimates it will receive net proceeds of $51.4 million from the stock offering, with that amount rising to $59.7 million if the underwriters purchase the full 525,000 shares available to them.
Underwriters for the stock offering are UBS Securities, BMO Capital Markets, Wells Fargo Securities and Needham and Company.
Aeglea BioTherapeutics was founded in December 2013 by University of Texas professor George Georgiou and local venture capitalist David Lowe -- who is now the company's CEO -- to commercialize therapies developed by Georgiou.
Credit: Cockrell School of Engineering
Credit: Cockrell School of Engineering
The company is developing drugs intended to exploit a vulnerability in cancer cells, preventing the cell from a key source of nourishment, the amino acid arginine, from the bloodstream. Cancer cells import arginine from the blood to continue growing after they stop producing the protein on their own and die when deprived of it.
Aeglea recorded a loss of $11.3 million in 2015, following losses of $10.3 million in 2014 and $1.9 million in 2013, and the company to date has “no recorded revenue from product sales,” according to securities filings.
As of Dec. 31, Aeglea has raised $54.7 million, and in June the company entered into a $19.8 million grant agreement with the Cancer Prevention and Research Institute of Texas, which extends through May 31, 2017, according to securities filings.
The company’s shareholders, according securities filings, include the UT Board of Regents, Lilly Ventures, Novartis Venture Fund, OrbiMed, Jennison Associates, Venrock, RA Capital Management, Rock Springs Capital and Ally Bridge Group.
In 2013, Aeglea entered into a licensing agreement with UT. The board of regents took its equity stake in the company through the Horizon Fund, which the board uses to invest in promising technologies developed by UT System researchers.
Whatever UT stands to gain from the public offering, it could reap a significant windfall if Aeglea receives regulatory approval for its cancer treatments, some of which are currently in the clinical trial phase. Under the terms of its licensing deal, such federal approval would trigger a $5 million payment to UT, with subsequent milestones potentially lifting that to $6.4 million.
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