IPO Aftermarket: Life sciences dominate new issues in October

Venture-backed biotech and healthcare companies dominated the IPO market in October, even with the debuts of a couple of recent tech companies.

Year-to-date through the end of October, 51 of the 66 VC-backed IPOs, or 77 percent, have been in life sciences or healthcare-related fields, according to a VCJ analysis of the market.

That’s a trend that continued in October as nine new venture-backed companies launch IPOs. Only two of the new issues in the month were tech companies: Pure Storage, a provider of flash enterprise storage, and Adesto Technologies, a provider of memory solutions.

Pure’s IPO was the largest of the month, raising in excess of $425 million and giving the Mountain View, Calif.-based company a $3.3 billion valuation. Previously, Pure raised more than $520 million in capital from Index VenturesSutter Hill VenturesGreylock PartnersRedpoint VenturesT. Rowe PriceTiger Global and Wellington Management, according to Thomson Reuters data.

Through the end of October, the 66 VC-backed companies that have gone public on the NYSE or Nasdaq exchanges have collectively raised more than $7.3 billion in proceeds, according to a VCJ analysis of year-to-date IPOs. In 2014, 118 venture-backed IPOs launched with combined proceeds of about $14.4 billion.

However, stock market watchers believe the IPO market may start to go cold for the remainder of the year, with fewer issues debuting. In mid-November, Square, the mobile-payments company founded in 2009 by Jack Dorsey, who also is the interim CEO of Twitter, launched its IPO.

But other than that, few others may be inclined to go out until next year.

In addition to Square, VCJ found a few other life science companies that were in registration and could launch before the end of the year.

They include:

  • Aeglea Biotherapeutics Inc, an Austin, Texas-based biopharmaceutical company that raised about $55 million from investors, including Lilly Ventures, OrbiMed Advisors and Venrock, among others.
  • Anterios Inc, a New York-based biopharmaceutical company focused on treatment of excessive underarm sweating, facial acne and lateral canthal lines, also called crow’s feet wrinkles. The company raised $10.5 million from Ascent Biomedical Ventures.
  • Valeritas, a Bridgewater, N.J.-based commercial-stage medical technology company focused on developing technologies for people with Type II diabetes. The company had raised about $370 million in funding from early and late-stage investors, with current backers including MPM Capital and Tullis Health Investors.

To download an Excel file: IPO Aftermarket, as of Oct. 31, 2015