Two life sciences IPOs and strengthening markets offer encouragement to Biotech sector

Two companies focused on infectious disease successfully completed initial public offerings (IPOs) in March, ending a drought in life sciences initial public offerings since the $2.6 billion debut of Pfizer's animal health business Zoetis at the end of January, notes health care focussed financial services firm Burrill & Co.

Watertown, Massachusetts-based Enanta Pharmaceuticals, developing a pipeline of novel small molecule drugs targeting hepatitis C, completed a $56 million offering selling 4 million shares at $14. The offering came at the bottom of its expected $14 to $16 range. Existing investors, along with other insiders, committed to purchase about one third of the offering. Shares in the company ended March up 30%.

Tetraphase Pharmaceuticals, also based in Watertown, and using synthetic chemistry to develop new antibiotics, completed a $75 million offering. The company sold a little more than 10.7 million shares at $7 each. The company originally planned to sell 6.8 million shares at between $10 and $12 each but to complete the IPO it had to cut the price and upsize the number of shares. Existing investors and insiders committed to purchasing up to a third of the offering at the IPO price. Tetraphase shares ended March up 1%.