IPO News: What awaits Adagio Therapeutics after stock market debut?

The favorable regulatory environment and convenient options like direct listing continue to lure emerging businesses to the stock market. The latest statistics show that 2021 has been the busiest year for the IPO market in terms of the number of listings, with the technology and healthcare sectors topping the list. Adagio Therapeutics, Inc. is the latest biotechnology company to pursue an initial public offering to take business expansion to the next level.

To Raise $319 Mil

In a submission made to the Securities and Exchange Commission this week, Adagio said it is looking to list on the Nasdaq Global Market under the symbol ADGI. The offering will be managed by a group of underwriters led by Morgan Stanley and Jefferies. As per the regulatory filing, the company intends to raise around $319 million by offering 17.7 million shares at $16-18 apiece. At the mid-point of the price range, the offer would value the company at approximately $2 billion.

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the Massachusetts-based biopharmaceutical company, which came into existence in June 2020 in a spin-off from Adimab, conducts research on antibody-based solutions with a focus on anti-coronavirus antibodies. Adagio recorded a net loss of $65.32 million or $18.10 per share in the seven months ended December 2020, from the day of inception. Total operating expenses were $65.3 million. The company did not generate any revenue during the period due to the absence of marketable products.

Strong Pipeline

Currently, the company is working towards the goal of launching COIVD-19 antibodies by 2022. The proceeds from the offering will mainly be used for funding the ongoing phase-II and advanced-stage clinical trials of ADG20, the lead product being developed as a potential treatment for, and prevention of, COVID-19. The drug is expected to help prevent future coronavirus outbreaks.

The main clinical and commercial attributes expected from ADG20 include: broadly neutralizing activity across sarbecoviruses, rapid onset of protection, differentiated durability, and convenient single-dose IM injection for use in the outpatient setting.

For US, Europe

If approved, the drug would initially be commercialized in the U.S and Europe. Plans are afoot to secure additional manufacturing capacity along with partners to enable a worldwide commercial launch. Further, additional antibodies will be developed for use in a potential combination with ADG20 to address future variants of COVID-19 and other such outbreaks.

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The primary challenge facing the company is maintaining healthy liquidity as it is expected to continue incurring losses until the lead product is commercialized successfully. Also, uncertainties surrounding the development of ADG20, which represents a novel approach to treatment, could delay the process of regulatory approval.

Adagio has raised around $470 million of capital from leading institutional healthcare investors and partners since its inception.