Biotech behind AstraZeneca vaccine aims to raise $117m at IPO

Vaccitech, the company behind the Oxford/AstraZeneca vaccine platform, said it planned to raise as much as $117m in a US initial public offering that would value the company at about $613m. 

The biotech, co-founded by University of Oxford scientists Sarah Gilbert and Adrian Hill, is trying to take advantage of investor appetite for science and innovation during the Covid-19 pandemic. 

The valuation has risen 44 per cent since the last round of private funding, announced last month, which valued it at about $425m, according to a person familiar with the matter. 

The Oxford-based company has rights to a 1.4 per cent share of the total net sales generated by the AstraZeneca vaccine, if it starts to be sold on a for-profit basis after the pandemic is over. It also received $2.5m last year when it transferred the technology to the drugmakers.

The vaccine — which has been given to millions of people — has helped prove the value of Vaccitech’s platform, which uses a chimpanzee adenovirus vector as a delivery mechanism. 

But Vaccitech has warned that recent concerns about very rare blood clotting side effects with the Oxford/AstraZeneca vaccine could hit royalties — or the reputation of its other products. 

Vaccitech is working on doses for Mers, another coronavirus, and the virus that causes shingles. It is also developing drugs for chronic hepatitis, human papillomavirus and prostate cancer, trying to harness the immune system’s T-cells to attack the tumour. 

The company recently raised $168m from investors including M&G Investment Management, Chinese company Tencent and Gilead Sciences, a California-based biotech.

Vaccitech has never generated a profit and last year reported a loss of $17.9m, which it disclosed stemmed largely from research and development and staff costs. It said it expected its expenses to rise “substantially” following its flotation as it pursued clinical development of its drug and vaccine candidates.

Total proceeds from the IPO could swell to $135m if underwriters, led by Morgan Stanley, exercise the so-called greenshoe and buy more shares from Vaccitech as part of the listing.

The company plans to list the American Depositary shares on the Nasdaq under the ticker symbol VACC.

Vaccitech’s decision to list in New York was a disappointment for the UK, which is trying to lure more life sciences investment. The UK Treasury has a small stake in the company, according to people close to the situation. 

Oxford Sciences Innovation, the early stage venture capital firm that commercialises intellectual property from Oxford university, is the largest shareholder in Vaccitech, with a 29 per cent stake before the offering.