Here are the latest upcoming technology IPOs:
Viking Therapeutics
Ticker: (NASDAQ: VKTX)
Expected to Trade: Monday, October 27
Price Range: $10.00-$12.00
Business Description
Viking Therapeutics is a development-stage biopharm company focused on therapies for metabolic and endocrine disorders. The Viking portfolio consists of five candidates currently in preclinical or clinical studies.
Viking’s lead clinical-stage candidate is VK0612, an oral dose for the treatment of type 2 diabetes that is currently entering Phase IIb.
The company’s second clinical program is VK5211, an oral selective androgen receptor modulator (SARM) for the treatment of cancer cachexia (muscle wasting and weight loss). It is currently entering Phase II of the development process.
Viking’s pre-clinical programs include therapeutics for various metabolic diseases and anemia.
Our Take
Viking’s VK0612 has successfully completed six Phase I trials and a Phase IIa proof-of-concept study. The candidate has already shown a strong safety profile as well as a significant and meaningful reduction in fasting plasma glucose when compared to a placebo. However, the drug is still in the early stages of development and is years away from commercialization.
In Phase I trials, Viking’s VK5211 demonstrated statistically significant increases in lean body mass among treated subjects following just 21 days of treatment. The goals of the program are to improve lean body mass, muscle strength, physical performance, and quality of life.
The therapeutic seems to be most useful in increasing body mass but was also shown to improve leg press force at a higher dosage. The product has a good chance of making it to market but, again, is very early in the development process.
Without a Phase III candidate in its portfolio, and with an annual burn rate of $23 million a year, Viking Therapeutics has a very high chance of dilution or even shutting down. As the company states in its prospectus:
“As of March 31, 2014, we do not believe that we will have sufficient cash to meet our operating requirements for at least the next 12 months unless this offering is successfully completed and we receive the full $2.5 million loan from Ligand pursuant to the Loan and Security Agreement.”
This could be worth a look down the road, but for now, steer clear of Viking Therapeutics.
Capnia
Ticker: (NASDAQ: CAPNU)
Expected to Trade: Monday, October 17
Price Range: $6.50-$6.50
Business Description
Capnia is a medical diagnostics and therapeutics company. The company’s products include Serenz, a handheld rapid allergy relief device, and CoSense, a device for measuring carbon monoxide inhalation for newborn babies.
Our Take
According to Capnia, Serenz has shown “a large effect size, relief of symptoms related to allergies within 30 minutes and a mild side effect profile.”
Unfortunately, Serenz is still a handheld medical device about the size of a small phone. We see little marketing potential for this when patients can easily take oral allergy medication. No one wants to carry a bulky device around with them and stick it up their nose in public if given another option.
As for CoSense, we see much better market potential here. Approximately 60% of healthy infants and 80% of premature infants have jaundice during the neonatal period, and jaundice is closely linked with carbon monoxide measurements. By monitoring carbon monoxide with CoSense, doctors can manage newborns that are at risk of negative neurodevelopmental outcomes.
Still, CoSense is Capnia’s sole product approved for sale, and relying on one product for revenue is incredibly risky. Capnia’s future will depend on its ability to market CoSense, and until the company can prove the ability to do so, you’ll want to avoid having any stake.
