Houston’s Bellicum Pharma Rides T-Cell Therapy Wave to $140M IPO

Bellicum Pharmaceuticals has made a little bit of Houston history. In becoming the latest in a new wave of cancer immunotherapy companies to go public, Bellicum has managed another feat—it’s the first Houston biotech to make it to the Nasdaq in nearly 15 years.

Bellicum priced 7.35 million shares Wednesday night at $19 apiece, raising $139.65 million before discounts due to underwriters. At those totals, Bellicum upsized its offering by 1.1 million shares and beat its projected $15 to $17 per share range. Bellicum’s total haul could end up even higher if its underwriters exercise their right to buy another 1,102,500 shares at the IPO price. The company will begin trading on the Nasdaq this morning under the ticker symbol “BLCM.”

The IPO is the first for a Houston life sciences company since Tanox, a maker of an allergic asthma treatment, pulled one off in 2000—the company was acquired by Genentech six years later for about $919 million). This past June, Fort Worth, TX-based ZS Pharma (NASDAQ: ZSPH), a developer of a drug to treat chronic kidney disease, became the first Texas biotech to go public since the $135 million IPO of Adams Respiratory Therapeutics in 2005. (The company, which was headquartered in New Jersey, was started in Fort Worth, and in 2008 sold to London-based Reckitt Bensicker Group for a reported $2.3 billion.)

Bellicum, which was founded 10 years ago, is one of a group of companies developing a particular type of cancer immunotherapy in which a patient’s own T cells are extracted, genetically modified, and then given back to the patient with a new protein that helps them find cancer cells and kill them. The approach is called chimeric antigen receptor therapy, or CAR-T, and it’s generated significant buzz because of very impressive—but early—results treating certain leukemias and lymphomas.

Others in the field include Seattle’s Juno Therapeutics, which is expected to go public later this week; Carl June’s group at the University of Pennsylvania, which is collaborating with Novartis; Summit, NJ-based Celgene (NASDAQ: CELG), via a deal with Cambridge, MA-based gene therapy company Bluebird Bio (NASDAQ: BLUE); and Santa Monica, CA-based Kite Pharma (NASDAQ: KITE). Pfizer also recently cut a deal with Paris-based Cellectis to tap into its CAR-T work. A new startup from Atlas Venture, Unum Therapeutics is also trying its own approach to T-cell therapy for cancer as well.

As more entrants crowd into the field, some differences have emerged, and some potential safety issues as well. Cellectis is developing an “off the shelf” type of CAR-T. Unum is engineering T cells with a surface protein that helps them latch onto antibodies. And companies in the space are combating ways to fend off an overdrive of the immune system called cytokine release syndrome that these immunotherapies can provoke.

Bellicum’s twist on all of this is what it calls “Chemical Induction of Dimerization” technology. Think of it as a “safety switch:” patients’ immune cells are embedded with an on/off switch, so that, in theory, these immune system attacks can be prevented.

One drug candidate, BPX-501, for instance, is designed with a cell-suicide mechanism that can be triggered to force it to kill cells gone rogue. “The product allows the physician to not have to worry about graft versus host (GVH) disease,” Bellicum CEO Tom Farrell told me in an interview this past August. “The cells can be eliminated in the event that GVH occurs.”

Bellicum is developing that as an adjunct therapy administered after a bone marrow transplant. It’s currently being tested in several Phase 1/2 clinical trials that are expected to produce data next year.

The company’s second therapy, BPX-201, is a vaccine that consists of dendritic cells that are programmed to fight prostate cancer. (The vaccine is made from the patient’s own white blood cells.) That’s being tested in an early-stage study as well.

Bellicum additionally has a few other preclinical candidates in its pipeline that it’s developing as cellular immunotherapies for blood cancers, solid tumors, and melanoma. They’ll begin trials either next year or in 2016.

The company will use the money to pay for those studies, for capital improvements at its facility in Houston, and to make new hires.

The largest shareholder before the offering, a 20.5 percent stake, was New York-based Baker Biotech Capital. Houston-based McGuyer Investments is next with a 14.9 percent stake. Rounding out the top five shareholders are Remeditex Ventures (12.2 percent), a healthcare venture capital firm in Dallas; Kevin Slawin (11.2 percent), Bellicum’s co-founder and current chief medical and chief technology officers; and AVG Ventures (6.1 percent) in Walnut Creek, CA.

Last August, Bellicum raised $55 million in a Series C round of venture capital, bringing its total funds raised to $107 million. The company was also one of the first recipients of funding from the Cancer Prevention Research Institute of Texas, which awarded the firm $6.2 million.

Deputy Biotechnology Editor Ben Fidler contributed to this report.

Author: Angela Shah