Clarity Becomes ASX’s Biggest Ever Biotech IPO

Clarity Pharmaceuticals Ltd. (ASX: CU6), a radiopharmaceutical company, made history last week when it completed the largest initial public offering for a biotech company on the Australian Securities Exchange (ASX).

The company raised AU$92 million (over US$67 million) at AU$1.46 (US$1.06) a share.

The record listing puts it far above that of Telix Pharmaceuticals, a fellow radiopharmaceutical company, which raised AU$50 million (around US$36.5 million) when it was listed in November 2017.

Clarity’s bid price climbed as much as 22% to reach a high of AU$1.71 (US$1.25) during trading before settling at AU$1.50 (US$1.09) for the day. It closed the week at AU$1.48 (US$1.08). The IPO was managed by investment banks Jefferies and Bell Potter. 

“Theranostic” Radiopharmaceutical Products  

Clarity was founded in 2010. Its technology is licensed from the University of Melbourne and the Australian Nuclear Science and Technology Organisation.

The company is developing radiopharmaceutical products that are “theranostic,” — meaning they can work as either therapy or a diagnostic tool.

Clarity’s SAR (structure-activity relationship) technology platform consists of 4 main elements: a radioisotope, a chelator or cage, a targeting ligand, and a linker.

The mechanism is simple in theory: the targeting ligand finds and binds to the cancer cell in the body. A linker molecule connects the ligand to a cage containing the payload: a copper radioisotope.

The radioisotope in use determines the platform’s function. Clarity uses copper-64 (Cu-64) for “search” purposes to identify where the cancer cells are located in the body through positron emission tomography (PET) scan. Copper-67 (Cu-67) is the “destroy” option; its radiotherapeutic properties will eliminate cancer cells. 

Clarity currently has three products: SARTATE, SAR-bisPSMA, and SAR-Bombesin.

SARTATE is Clarity’s most advanced product, having entered Phase 2 clinical trials. The FDA has granted Orphan Drug Designation (ODD) status for the use of Cu-64-SARTATE and Cu-67-SARTATE in the treatment and management of neuroblastoma, a rare cancer that affects children. The products have also received two rare pediatric drug designations (RPDD) from the FDA.

Investor Attention from China

Hong Kong-based China Grand Pharmaceuticals and Healthcare was one of the investors interested in Clarity.

The investment holding company has agreed to bankroll Clarity for $44.7 million (US$32.6 million). In addition, it stands to gain an 8.3% stake in Clarity via an options deal.

It is also negotiating with Clarity to use its technology in greater China.

Author

Joy Lin

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