Feb 27 (Reuters) – Flagship-backed Generate Biomedicines’ shares fell 6.25% in their Nasdaq debut on Friday, giving the drug developer a valuation of $1.91 billion, as lingering market volatility kept investors cautious toward new listings.
The Somerville, Massachusetts-based company’s shares opened at $15, compared with its IPO price of $16. It raised $400 million in its U.S. initial public offering on Thursday, after selling 25 million shares within its marketed range of $15 to $17 apiece.
Biotech IPOs have gained momentum as interest rates ease and capital returns to the sector, but the recovery remains uneven, with investors staying selective.
Eikon Therapeutics and Agomab Therapeutics, health-sector companies that have recently done IPOs, are both trading below their offer prices as of last close.
Generate Biomedicines, which describes itself as a pioneer in applying artificial intelligence to biotechnology and drug design, plans to use much of the IPO’s proceeds to complete two Phase 3 trials of its lead asthma drug, GB‑0895.
Its early work includes GB‑0669, a COVID‑19 antibody that showed broad, variant‑resistant activity, though the company has shelved its development in light of changing market conditions for preventive COVID‑19 therapies.
Noubar Afeyan, who co-founded drugmaker Moderna and is among the board chairs of Generate, is expected to control 49% of the shares through investment firm Flagship Pioneering. The board also includes Nobel laureate Frances Arnold and Moderna CEO Stéphane Bancel.
(Reporting by Pragyan Kalita and Pritam Biswas in Bengaluru; Editing by Sahal Muhammed)
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