Scynexis shares fell 10 percent on their first day of trading after the Durham drug developer became the fourth Triangle company to complete an initial public offering of stock this year.
The company’s shares never made it above the offering price of $10 on Friday, opening at $9.75 and closing at $9.
Scynexis sold 6.2 million shares. After deducting fees and other expenses, the company expects its proceeds to be about $55.1 million. That amount could rise to $63.8 million if underwriters exercise the option to purchase an additional 930,000 shares.
Scynexis, which doesn’t yet have a drug on the market, plans to use $30 million from the IPO to develop its leading drug candidate. The product is an intravenous drug for treating serious and life-threatening fungal infections that is years away from approval.
The experimental drug, SCY-078, stemmed from a collaboration between Scynexis and pharmaceutical giant Merck. Last year, Merck returned the development and commercialization rights to Scynexis.
Scynexis’ IPO road was far from smooth, and its struggles are another indication that the market for biotech IPOs may be cooling.
The 90-employee company initially filed plans in March and targeted selling 4.2 million shares at between $12 and $14. In early April, Scynexis downgraded the anticipated price to between $7 and $8 but increased the number of shares to be sold to 7.3 million.
On April 25, Scynexis conducted a 1-for-5.1 reverse stock split that greatly reduced the value of the company. Its market capitalization – the total value of its outstanding shares after going public at $10 per share – was $84.5 million, nearly 60 percent below what the company’s market cap would have been under the IPO plans it submitted in March.
Scynexis posted $16.9 million in revenue last year from research-and-development services it performed for other companies. Its net loss was $30.5 million.
The other Triangle companies to go public this year were Square 1 Bank, Argos Therapeutics and NephroGenex.
Scynexis trades on the Nasdaq under the ticker symbol SCYX.
Bracken: 919-829-4548; Twitter: @brackendavid