BOULDER — Clovis Oncology debuted Wednesday on Wall Street with an upsized initial public offering that garnered nearly $130 million.
The IPO of the company founded by former executives of Boulder’s Pharmion was priced at $13 per share, the low end of the projected range of $13 to $15 per share. The company, however, sold 10 million shares — 7.5 percent more than expected — which resulted in the local biotech raising $130 million before underwriting discounts and commissions.
It’s the largest IPO by a Boulder County company since Longmont-based satellite imagery firm DigitalGlobe’s $173.9 million offering in 2009.
Shares of Clovis went the way of the market Wednesday, closing down 44 cents, or 3.4 percent, to $12.56.
The funds are expected to allow Clovis to get to proof-of-concept data for each of its three programs, said Patrick Mahaffy, chief executive. Clovis is one year away from receiving “pivotal” data for its pancreatic cancer drug, he said.
Clovis officials said in the registration documents filed in June that the proceeds will be used to fund trials of its pancreatic cancer and small tumor treatment drugs, to advance the development of its non-small cell lung cancer therapy and to provide additional working capital.
The timing of the IPO was critical, Mahaffy said, noting that he was advised by many in the industry who said the most appropriate time for a biotechnology firm to go public is about a year before such data is released.
“So, from that standpoint, it was the right time,” Mahaffy said. “If we could raise the funds that allow us to get to proof-of-concept data for each of our three products . . . this is the means to do it.”
Clovis was well-received by investors at a time of continued turbulence for the stock market, Mahaffy said, adding that he felt his firm was “fortunate” that some stockholders looked upon Pharmion with fondness.
Pharmion Corp., which raised $76.2 million in a 2004 IPO, was acquired by Celgene Corp. for $2.9 billion in 2008. One year later, Mahaffy and other key Pharmion executives launched Clovis.
Mahaffy said Clovis would have to raise additional funds at some point in the future, but added the completion of the IPO and raising $130 million puts Clovis in the right direction. The funds, he said, will be sufficient to put Clovis on the path of creating therapies that can be used with companion diagnostics to treat specific affected patients.
“We now have to prove the drugs can do what we really hope they can do,” he said.
