Despite the stagnant biotech IPO market of the last six months, LB Pharmaceuticals has set out plans to reel in hundreds of millions of dollars through its upcoming public debut.
The CNS-focused-biotech aims to rake in approximately $228.5 million, or $263.4 million depending on options, by offering 16.7 million shares at an assumed offering price of $15 per share. The final proceeds will include deductions for "underwriting discounts and commissions and estimated offering expenses," the company explained.
LB Pharma plans to use the proceeds to advance its oral schizophrenia candidate LB-102, the company laid out in a Securities and Exchange Commission (SEC) document filed Sept. 8.
LB-102 is a modified version of amisulpride, a dopamine inhibitor developed in the 1980s and marketed by Sanofi as Solian outside the U.S. In January, LB Pharma unveiled top-line data from a phase 2 study showing its candidate was linked to statistically significant changes on a symptom scale after four weeks of treatment.
The company is building its overall strategy around LB-102 and its mission to maximize the commercial opportunity it sees with the asset. LB Pharma plans to first break into the U.S. schizophrenia market with an FDA approval before expanding to other disorders such as bipolar depression and later developing alternative formulations to lengthen its life cycle and reach, the biotech said in the filing.
To do so, LB Pharma will need the cash expected to come from the IPO. As of June 30, the company had only $14 million in the bank and an accumulated deficit of $114 million.
Specifically, LB Pharma expects to spend $133 million of its expected IPO profits on a phase 3 study of LB-102 in schizophrenia, while about $25 million will support a phase 2 trial in bipolar disorder. The rest will be allotted to “general corporate purposes.”
Along with its existing cash, the proceeds should be enough to fund operations through the first quarter of 2028, the company said.
LB Pharma has previously raised funding from Deep Track Capital, TCG Crossover, Vida Ventures and Pontifax. It is now operating under a new CEO in Heather Turner, the former chief at Roche-acquired Carmot Therapeutics. Recent efforts to stretch the company’s cash runway include a layoff round in May that included the departure of its chief financial officer and chief scientific officer.
The biotech IPO market has been dry since February. LB Pharma plans to list itself on the Nasdaq under the symbol “LBRX.”