A company developing developing drugs for neurological diseases expects to raise $176 million in its initial public offering.
South San Francisco, California-based Alector said Thursday that it would offer 9.25 million shares to the public at $19 per share. The offering is expected to close Monday, and the company started trading on the Nasdaq Thursday under the ticker symbol “ALEC.”
The company filed to go public last month, with a proposed maximum aggregate offering price of $150 million, according to its form S-1 filing with the Securities and Exchange Commission. Morgan Stanley, BofA Merrill Lynch, Cowen and Barclays are acting as joint book-running managers for the offering.
The company has four product candidates in preclinical and clinical development. AL001 and AL002 are in Phase I studies for frontotemporal dementia and Alzheimer’s disease, respectively, while AL101 and AL003 are respectively in development for an unspecified area of neurology and Alzheimer’s. AL002 and AL003 are partnered with AbbVie. The company received orphan drug designation from the Food and Drug Administration in August 2018 and initiated the Phase I study of it in September, followed by the Phase I AL002 study in November.
Alector’s approach is based on immuno-neurology. Under the current therapeutic approach, particularly for Alzheimer’s disease, therapies only target either Tau tangles or amyloid beta aggregates. By contrast, Alector’s programs are designed to leverage the body’s own innate immune cells, the microglia, to counteract multiple pathologies simultaneously.
The IPO follows the more than month-long government shutdown that many had feared would put a damper on the ability of companies, particularly biopharma companies, to go public. One, San Diego-based Gossamer Bio, initially said it would allow its IPO to take effect automatically during the shutdown, without SEC signing off, using a workaround that the agency had said would be allowed. However, the workaround was viewed as being fraught with legal risks. When the shutdown ended, the company changed course, saying it would seek an acceleration of the registration statement’s effective date from the SEC.
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