COMMENTARY REGARDING BIOTECH OFFERINGS THIS WEEK:
Entering the week, it seemed the IPO market had momentum and the quality of the deals (at least the U.S. ones) were quite good. But this week delivered quite a blow and leaves us thinking there could be “cracks in the IPO market”.
It mainly revolves around the biotech debacle from this week. Entasis Therapeutics (ETTX), Urovant Sciences (UROV), Sutro Biopharma (STRO) and Gritstone Oncology (GRTS) were either unmitigated disasters or came nowhere near their hype. The underwriters and/or market makers are seemingly under the pretenses that they have no “duty” to assist broken issues. This is an expensive lesson for IPO investors who do not have information regarding IPOs leading up to their debuts.
Entasis Pharmaceuticals and Urovant Sciences opened -10.3% and -25.0%, respectively!
The bio that opened strong, Arvinas Inc (ARVN), traded under its issue price in the premarket of today’s session! The Chinese IPO theme continues to be a wild card as they trade like its the wild, wild west.
Is this a sign that the appetite for biotech offerings is waning? Was this to “scare away” fast money? These are the questions we are asking our sources and delivering to our paying client base.
The IPO market always has fast money. But with or without fast money…this week ended with a lot of soul searching and questions about what to expect with the large pipeline that is pending and ready for launch.
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