Kidney failure biotech Proteon Therapeutics sets terms for $61 million IPO

Proteon Therapeutics, a biotech developing a recombinant protein for patients undergoing surgery for kidney failure, announced terms for its IPO on Tuesday. The Waltham, MA-based company plans to raise $61 million by offering 4.7 million shares at a price range of $12 to $14. At the midpoint of the proposed range, it would command a fully diluted market value of $199 million.

Proteon expects its lead product to enter Phase 3 trials in the 1H15, with results expected in 2017. In preparation for hemodialysis, a surgeon must often create an arteriovenous fistula (AVF) to provide vascular access. The company estimates there are 130,000 AVFs created in the US annually, yet these have a greater than 50% failure rate in the first year of placement, and a higher failure rate for radiocephalic AVFs, its initial indication. AVF failure can be restored with a balloon angioplasty, but Proteon claims that surgeons can apply drops of its recombinant human elastase, a type of protein, to prevent complications further on.

Primary shareholders include TVM Capital, Abingworth Bioventures, Prism Venture Partners, Skyline Venture Partners, Deerfield, Pharmstandard, Intersouth, MPM Capital and CEO Timothy Noyes. Insiders intend to purchase $30 million worth of shares on the offering (50% at the midpoint).

Another recombinant protein maker, rEVO Biologics (RBIO), postponed its IPO earlier this month. Two other biotechs focused on kidney failure have gone public this year - Ardelyx (ARDX) and Concert Pharmaceuticals (CNCE). Ardelyx gained 45% after its June offering, broke issue in IPO price in August, and within the past two weeks has spiked over 60% above its offer price.

Proteon Therapeutics, which was founded in 2001, plans to list on the NASDAQ under the symbol PRTO. Stifel and JMP Securities are the joint bookrunners on the deal. No pricing date has been selected.