Today, we’re talking about IPOs coming out the week of August 17th as well as taking
a look at CureVac, who was a late addition to last week’s slate and began its trading
on Friday, popping over 200% on its debut. And this week I have something new for you,
we have 2 SPACs we’ll cover this week as well. If you like hearing about all of the
opportunities for investing in newly available companies, you’ve come to the right place!
Welcome to Healthy, Wealthy, and Wise and our weekly feature, IPO This Week where we
cover all of the companies going public plus all the lockup and notable quiet period expirations.
I’d like to welcome back everyone in the community…it’s so awesome to have you
back every week….just wanted to thank you all for watching!
So just to catch up, last Thursday, I released a video that talked about different options
for investing in newly available companies besides for traditional IPOs…hopefully you
checked it out, but if you haven’t seen it yet, I’ll link it for you in the description.
In it, we talked about SPACs and IPO ETFs for the first time on the channel and I asked
if there was any interest in me covering SPACs, and of the feedback I received, it was positive.
So this may continue to evolve on how I do it, but since we have another shorter line-up
of IPOs this week, I’ll let you know what SPACs are also coming out and what they’re
targeting on today’s video as well. And then another thing to catch up on was
on Friday, when a company named CureVac that was added to the IPO calendar after I recorded
last week’s episode started trading and I wanted to give some information and my thoughts
on it today as well…so we have quite a few things to talk about today. As we get into
it, just a quick reminder that while this video is meant to be informative, it should
not be seen as a recommendation from me for you to take any action on the companies covered—you
should always do your own research or consult with your own financial advisor when making
any investment decision. So let’s kick this week’s show off with
a couple of new biotechs coming to the market. First up is Harmony Biosciences, ticker HRMY,
a commercial stage biotech that plans to raise $100 million at a $1.4 billion market cap
which makes it the biggest deal on the table this week. The company currently has one marketed
product named WAKIX, which is the first and only approved product for adult narcolepsy
that is not scheduled as a controlled substance. WAKIX has generated 64 million dollars in
revenue since its commercial launch last November. If you’re not sure what Narcolepsy is, it’s
a chronic sleep disorder characterized by overwhelming daytime drowsiness and sudden
attacks of sleep. And no, my videos are not a cause for it…unless you’re my family
and friends who just watch to see me but have no actual interest in investing. Hey Mom!
The company plans to pursue approval for expanding the indications for WAKIX to also include
pediatric narcolepsy and adult cataplexy, which is a sudden, brief loss of voluntary
muscle tone triggered by strong emotions such as laughter, which tends to be associated
with narcolepsy. According to a 2019 market research report by Allied Market Research,
the global market for narcolepsy treatment was an estimated $2.4 billion in 2018 and
is expected to exceed $5.3 billion by 2026 which represents a forecasted Compound Annual
Growth Rate of 10.3%. The company looks to have its IPO on Tuesday with pricing expected
to be set within a range of 20-23 dollars with trading to begin on Wednesday
The second biotech is a Phase 1 biotech named Inhibrx, ticker INBX, who plans to raise 102
million dollars at a $620 million market cap. According to information on Nasdaq.com, this
is the company’s second attempt to go public with it also filing last year before withdrawing
in November. The early stage biotech is primarily targeting oncology or cancer-related indications
such as chondrosarcoma, which attacks the body’s cartilage, and mesothelioma, which
is caused by asbestos and primarily attacks the lungs and heart. The company has four
clinical candidates which are all in those early stage Phase 1 trials, so they aren’t
close to bringing anything to market. Needless to say, other than receiving some revenue
for licensing fees, they’re not bringing in any money as of yet. Inhibrx also looks
to have its IPO on Tuesday with pricing expected to be set in a range of 16-18 dollars with
trading to begin on Wednesday. Keeping up with the medical focus for this
week, we have Nano-X Imaging, ticker NNOX, a company that is working towards providing
affordable medical imaging systems through the development of what they call a 'novel
digital micro-electro-mechanical system semiconductor cathode' that it believes can produce the
same results as X-ray technology but at a fraction of the cost. The product in development
is a combination hardware and software system called the Nanox System, which as of this
time, has not yet been approved by the FDA, although the company expects to deploy the
first generation of the product in the first half of next year, if it’s working prototype
gets cleared. So at this point, it’s another company not bringing in any revenue at this
time. According to a 2020 market research report by Grand View Research, the global
market for medical imaging was approximately $20.1 billion in 2017 and is expected to reach
$30 billion by 2027, representing a forecasted Compound Annual Growth Rate of 4.0%. The company
plans to raise $100 million at a $793 million market cap with pricing expected to be on
Thursday to be set within a range of 16-18 dollars. Trading should then begin on Friday
the 21st. Before we get to the SPACs and CureVac, let’s
go over this week’s lockup expirations. And this will be quick as we only have one:
Zhongchao, ticker ZCMD, a Chinese company who provides healthcare information, education,
and training services in China; their lock up expires on Wednesday. They initially priced
at $4 and are now currently trading at $2.20. We also have a notable quiet period ending
and that is for Jamf, ticker JAMF, a company that partners with Apple. We’ll have to
see if any research reports or information from the company come out that might boost
the stock. Okay, moving on, let’s talk about CureVac
next, ticker CVAC. As I mentioned, this company set its IPO date, after I recorded last week’s
episode on Monday morning, so I didn’t have a chance to talk about them with you. IPO
dates are always fluid, and keeping tracking of foreign companies is even a little more
difficult. However, as I always try to do, I did try to let everyone know that they were
added to the calendar by posting an update in the comments so that you could at least
be aware that they were out there. So as you might’ve heard, the company had its offering
price set at $16 and then opened trading at $44 on Friday before finally closing to just
under 56 dollars. Today, I just wanted to give you a little more information on the
company, why it likely popped out of the gate, and share some thoughts on why you might want
to take a cautious approach with the company, but also what might be compelling about them.
So for some background, the company is a biotech established in Germany to develop mRNA-mediated
treatment options for cancers, viral diseases, and protein-based gene-editing therapies.
The company's pipeline contains lead candidates CV8102, which is currently in a Phase 1 trial
for squamous cell cancer and melanoma, and CV7202, which is currently in a Phase 1 trial
for potential vaccination against rabies. And then what likely garnered most of the
attention for CureVac's IPO is that they are also advancing its mRNA vaccine program to
fight the virus behind the pandemic, where they initiated a Phase 1 trial in healthy
volunteers in June with results expected in the 4th quarter. The company reported that
results of their preclinical studies suggested that their vaccine candidate against the pandemic
virus was active at a low dose of 2 micro-grams and triggered fast induction of a balanced
immune response with high levels of T-cell responses which prompted them to begin the
Phase 1 trial. As we’ve seen with other biotechs like Moderna,
Novavax, and Inovio, any involvement in working towards developing a vaccine is bringing money
to the table. While CureVac hasn’t brought anything to market as of yet, it has established
many academic and biopharmaceutical collaborations and brought in funding from entities like
the Bill & Melinda Gates Foundation and CEPI. The vaccine they are developing would be most
similar to Moderna’s approach in their use of a messenger RNA technology platform as
compared to some other vaccine approaches. So what do I think are the pros and cons of
the company? Well, there’s a couple of things I do like. In the short term by focusing on
the pandemic, they are likely to bring in more outside money and resources to help grow
the company, including in areas of manufacturing. I also like that they have a variety of products
in their pipeline which focus on other medical indications such as cancers and rabies that
have reached phase 1 level studies, but they are also in earlier stages of addressing conditions
such as metabolic disorders and respiratory diseases.
Having said that, I definitely think they have some headwinds, as far as from an investment
perspective, many of these in relation to a pandemic vaccine, which is what everyone
is thinking about with the company. These headwinds involve a lot of the things I mentioned
in my Vaccine Stock Investing Primer video…if you haven’t seen that one, you might want
to check it out…I’ll link it in the description. Some of the main factors in that video that
would apply here is: the number of companies that are working towards a vaccine that have
deeper pockets and more resources, the likelihood of multiple successful vaccines developed,
and pressures on pricing. There’s a lot to consider that I talk about more in-depth
in that video that I won't take up your time with here. With CureVac and their candidate,
it’s clear that they are behind in the race, with many companies already being in the Phase
2 and 3 studies, while they are still in Phase 1…so another reason for caution. Beyond
the pandemic, while they have other focuses, they are still early on in development of
their pipeline. It could take years for their lead candidates to obtain approval and get
to market. And that’s the best case scenario; because there’s no guarantee that those
later phase trials will show that their candidates are safe and effective. Keep in mind that
earlier stage biotechs are risky in general, so nothing I say is to disparage CureVac,
it’s just the reality. If you understand the situation with the company and are okay
with what they’re doing and where they’re at in its development, then great. Anyways,
just wanted to share some thoughts of mine on CureVac with you since I hadn’t had a
chance yet. Okay, as promised, let’s talk about this
week’s upcoming SPACs. Since this is the first week covering them, I’ll mostly give
you an overview of the company and what they’re targeting. As this coverage evolves, I’ll
try to share more helpful information with you going forward…so feel free to give me
some slack here for now. First up is Northern Genesis Acquisition, ticker NGA.U, which is
a blank check company targeting to obtain an environmentally sustainable business. They
plan to raise $300 million to acquire a business with a strong environmental, social, and governance
profile. The company’s management team has experience in the energy and utilities sectors
and plans to target a variety of industries, so other than knowing they’re looking for
an eco-friendly company, it’s pretty wide open. Trading looks to start on Tuesday.
And the second one on the calendar is Petra Acquisition, ticker PAICU, who plans to raise
$125 million to acquire a business in the cannabis industry. Now considering the subpar
stock performance for companies like Aurora Cannabis and Canopy over the past couple of
years, it will be interesting to see how this one plays out. The SPAC is led by CEO and
Chairman Andreas Typaldos, who has founded several companies in the technology, software,
artificial intelligence, and lifestyle markets. I don’t have a date yet for trading, but
I’ll add it in the comments when I do unless someone beats me to it.
So there you have it: an analysis of last week’s big IPO debut as well as 3 new companies
and 2 new SPACs to consider investing in for this week. That was a lot to cover! And with
that, please like the video if you enjoyed it and share with your friends or also on
any of your social media sites—the more exposure we get, the more we can grow the
channel together which'll allow me to justify putting more resources towards it. And if
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community, it’s totally free, you just gotta press that red subscribe button. And with
that, I’ll wish you a good week of trading….thank you for watching and, until next time, have
a great day!