Enbrel biosimilar biotech Coherus BioSciences sets terms for $85 million IPO

Coherus BioSciences, which is developing a biosimilar version of Amgen's Enbrel treatment for inflammatory diseases, announced terms for its IPO on Friday. The Redwood City, CA-based company plans to raise $85 million by offering 6.3 million shares at a price range of $12 to $15. At the midpoint of the proposed range, it would command a fully diluted market value of $508 million.

Business
Enbrel is a self-injected prescription treatment marketed by Amgen that can be used to treat five inflammatory diseases, including rheumatoid arthritis, plaque psoriasis, psoriatic arthritis, juvenile idiopathic arthritis and ankylosing spondylitis. Due to their molecular complexity, these biologic treatments cannot be reproduced like generic drugs and instead companies like Coherus develop a biosimilar version.

Coherus is in Phase 3 trials for the rheumatoid arthritis and psoriasis indications, and expects to submit a marketing authorization application in the European Union in 2016. It has partnered with Baxter Healthcare and Daiichi Sankyo (a primary shareholder), which will have commercialization rights outside of the US. Coherus has also completed Phase 1 trials for biosimilar versions of AbbVie's Humira and Amgen's Neulasta. Both Humira and Enbrel are "anti-TNF" products with similar indications and projected 2017 global sales of about $19 billion in the regions Coherus or its partners will target.

Shareholders
Primary shareholders include Daiichi Sankyo, Lilly Ventures, Medpace , KKR, Sofinnova Ventures, Chairman and CEO Dennis Lanfear and Venrock.

2014 psoriasis IPOs
Coherus is one of several biotech IPOs with a psoriasis indication, including Dermira (DERM), which has fallen 9% since its October 3 IPO. Vitae Pharmaceuticals (VTAE), which has preclinical candidates for psoriasis and rheumatoid arthritis, gained 24% on Thursday and now trades 8% above its IPO price. Forward Pharma (FWP), down 5% since October 15, is mainly focused on multiple sclerosis but also has a psoriasis indication. Postponed IPO Virobay (VBAY), backed by TPG and AbbVie, targets pain, Crohn's disease and psoriasis. The year's other biosimilar biotech IPO, Pfenex (PFNX; up 30% since IPO), is developing a version of Roche's Lucentis treatment for wet AMD.

Coherus BioSciences, which was founded in 2010 and booked $10 million in sales for the 12 months ended June 30, 2014, plans to list on the NASDAQ under the symbol CHRS. J.P. Morgan and Credit Suisse are the joint bookrunners on the deal. It is expected to price during the week of October 3, 2014.