Alumis aims for $300M raise in potential year's third-largest IPO

Alumis has set ambitious terms for its imminent public debut, aiming to become the third-largest IPO of the year in the biotech sector. The company, focused on developing TYK2 inhibitors to treat various autoimmune and neurodegenerative diseases, plans to sell 17.7 million shares at a price range of $16 to $18 each. At the midpoint of this range, Alumis would raise $300 million, positioning it just behind CG Oncology's $380 million IPO in January and Kyverna's $319 million offering in February. Should underwriters exercise their overallotment option, Alumis could achieve a valuation approaching $1 billion.

Navigating Market Turbulence

The biotech sector has faced significant volatility in the public markets this year. Despite the market's ups and downs, recent IPOs suggest that Alumis might find success. Earlier this month, Rapport Therapeutics, a neuromedicines developer, raised $136 million in its IPO and has managed to keep its stock performing well, unlike many other biotechs that have gone public this year.

Alumis shares some similarities with Rapport Therapeutics, which could bode well for its own IPO. Both companies have neurology programs and had secured substantial venture funding prior to pursuing public offerings. Alumis, for example, raised $259 million in March, bringing its total private funding to $600 million. This financial backing has been crucial in advancing its pipeline of TKY2 inhibitors. Alumis' lead program, ESK-001, is scheduled to enter a Phase III study for plaque psoriasis in the latter half of the year. The company is also working on a brain-penetrant compound aimed at treating neuroinflammatory diseases such as multiple sclerosis.

Challenges in the Public Market

However, it's important to note that the public market hasn't been favorable for everyone. For instance, Australian radiopharmaceutical developer Telix withdrew its NASDAQ IPO plans earlier this month, citing lower-than-expected pricing. This highlights the uncertain environment that biotechs face when going public.

Nevertheless, the challenges experienced by some companies haven't dissuaded others from seeking opportunities in the public market. Chinese cancer drug developer Ascentage Pharma, which is already listed on the Hong Kong Stock Exchange, announced its intention to pursue a US IPO. This move indicates that despite the risks, there remains a strong interest in tapping into the US public markets.

In conclusion, while the biotech sector has witnessed both successes and setbacks in the public markets this year, Alumis appears well-prepared for its IPO. With substantial venture funding and promising pipeline developments, the company is positioned to make a significant impact. If market conditions are favorable, Alumis could very well achieve its lofty valuation goals, securing its place among the top biotech IPOs of the year.