Beam Therapeutics enjoyed a successful Wall Street debut Thursday, as the first base editing treatments developer to go public saw its shares surge 45% from its initial public offering (IPO) price before dipping to a 10% first-day gain, closing at $18.75.
Founded in 2017 by gene editing pioneers, Beam Therapeutics raised gross proceeds of $180 million through its IPO of 10,588,236 shares at $17 a share.
Beam priced its shares at the high end of its $15–$17 range, while selling 48% more shares than the 6.25 million shares it envisioned when it first disclosed plans to go public in September 2019. Beam shares trade on the Nasdaq Global Select Market under the symbol “BEAM.”
Beam has also granted its IPO underwriters a 30-day option to purchase up to an additional 1,588,235 shares of common stock at the initial public offering price, less the underwriting discounts and commissions. The offering is expected to close on Monday, subject to satisfying customary closing conditions.
“The principal purposes of this offering are to increase our financial flexibility, create a public market for our common stock, and to facilitate our access to the public equity markets,” Beam stated in its Amendment No. 4 to Form S-1 Registration Statement, filed February 5.
In that amended statement, Beam disclosed plans for its net proceeds that included setting aside:
- Approximately $79 million for continued R&D of its portfolio of base editing programs, including preclinical studies and advancement through potential preclinical proof-of-concept for Beam’s three delivery modalities;
- Approximately $66 million for IND-enabling studies and the potential initiation of clinical studies for at least some of the company’s current programs;
- Approximately $51 million for continued advancement of Beam’s platform technologies and discovery-stage research for other potential programs;
- And the remainder for general corporate purposes.
“Our goal is to become the leading company in precision genetic medicines by discovering, developing, manufacturing, and ultimately commercializing a new class of medicines through our proprietary base editing technology, with the vision of providing life-long cures to patients suffering from serious diseases,” Beam declared.
David R. Liu, PhD, of the Broad Institute of Harvard and MIT, as well as Harvard University and the Howard Hughes Medical Institute, co-founded Beam along with CRISPR pioneer Feng Zhang, PhD, and Keith Joung, MD, PhD, of Massachusetts General Hospital and Harvard Medical School.
Since its founding in 2017, Beam has grown to more than 100 employees. In addition to its own intellectual property covering elements of base editing, as well as additional gene editing technologies and delivery modalities, Beam has inked exclusive licenses with Harvard University, the Broad Institute of MIT and Harvard, Editas Medicine, and Bio Palette.
“We have raised approximately $224 million in capital from premier venture capital funds, healthcare-dedicated funds, major mutual funds, and other leading investors that share our vision to build a highly innovative, fully integrated genetic medicines company,” Beam disclosed—a figure that included its $135 million Series B round, completed in March 2019.
The company reported total capitalization of $126.7 million as of September 30, 2019, including about $110.9 million in cash, cash equivalents, and marketable securities.
For the nine months ending September 30, Beam reported a net loss of approximately $50.5 million, compared with a net loss of $91.5 million for January–September 2018, part of the company’s $116.7 million net loss for all of 2018.
Single-letter genome editing
Based in Cambridge, MA, Beam has stated that its foundational technologies can edit the genome at the level of a single letter—A, G, C, or T—without cutting DNA or RNA strands. The company noted that more than half of the genetic errors associated with disease result from a single-letter change in the billions of nucleobases or “bases” forming the human genome.
The company applies CRISPR base-editing technology to make permanent, specific edits to single bases in DNA and RNA. By precisely modifying the genome to eliminate errors or write in protective changes, Beam reasons, its novel approach to base editing may underpin new treatments for a wide range of diseases.
Beam’s base editors consist of two principal components that are fused together to form a single protein. One is a CRISPR protein bound to a guide RNA that leverages the established DNA-targeting ability of CRISPR, but modified to not cause a double-stranded break. The other is a base editing enzyme, such as a deaminase, which carries out the desired chemical modification of the target DNA base.
The company also detailed its all-preclinical pipeline of 12 programs, divided by three delivery modalities:
- Electroportation, intended for efficient delivery to blood cells and immune cells ex vivo;
- Lipid nanoparticles (LNPs), for non-viral in vivo delivery to the liver and potentially other organs in the future;
- Viral delivery based on adeno-associated viral vectors (AAVs), for viral delivery to the eye and CNS.
“We have also successfully demonstrated feasibility of base editing with each of our three delivery modalities in relevant cell types for electroporation and AAV and in vivo in mice for LNP,” Beam stated in its amended registration statement. “We believe our base editing programs are well-positioned to leverage the clinical, regulatory, and manufacturing advancements made to date across gene therapy, gene editing, and delivery modalities to accelerate progression to clinical trials and potential approval.”
Among electroportation candidates, Beam said, it has achieved proof-of-concept in vivo with long-term engraftment of ex vivo base edited human CD34 cells in mice for its Hereditary Persistence of Fetal Hemoglobin (HPFH) program, and shown preclinical base editing of cells in vitro at therapeutically relevant levels for most of its remaining programs.
“We expect to achieve additional preclinical proofs-of-concept in vivo for additional programs in 2020, which could include engraftment results for the Makassar precise correction sickle cell program, xenograft models for our CAR-T programs, or in vivo base editing in our programs using LNP or AAV delivery,” Beam added. “If successful, this will allow us to initiate investigational new drug (IND)-enabling studies for multiple programs beginning in 2020, potentially leading to an initial wave of IND filings beginning in 2021.”
J.P. Morgan, Jefferies, and Barclays are acting as joint book-running managers for the IPO. Wedbush PacGrow is acting as lead manager for the offering.
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