Venture Capital: Keros Therapeutics Files With the SEC for an $86M IPO

March 18, 2020 | Latest News, News, Venture Capital

The biotech is hoping to raise money from an IPO, but its timing could have been better.

Panicked investors, fearing the worst from the coronavirus epidemic, have hammered the stock markets. Roiled by fear, the CBOE VIX index is currently ruling at a high 75.91. It closed Monday at an all-time high of 82.69. Its previous closing high was 80.86 in 2008 at the time of the global financial crisis. Another name for the VIX is “fear gauge.”

It appears that Keros Therapeutics is proposing to float an IPO, not at the best of times. (PitchBook)

Keros Therapeutics IPO

However, Keros Therapeutics has filed with the SEC to go public on the Nasdaq in an offering that could raise more than $86 million.

The Massachusetts-based biopharma company develops therapies for patients with hematological and musculoskeletal disorders.

Further, the company’s target markets include myelodysplastic syndromes (MDS)-associated cytopenias, myelofibrosis-cytopenias, anemia resulting from elevated levels of hepcidin, such as IRIDA, FOP, osteoporosis, osteogenesis imperfecta, and PAH.

“In the United States, there are 60,000 to 170,000 patients with MDS and 15,000 to 20,000 new cases of MDS reported each year. Cytopenias in MDS are caused by defects occurring across the various stages of hematopoiesis, from the self-renewal of progenitor cells to differentiation in early through terminal stages. Anemia is the most frequent consequence of ineffective hematopoiesis in patients with MDS due to low red blood cell production, impacting 90% of MDS patients, approximately 40% of whom become transfusion dependent.” – From the S1 filing.

Venture backers

Backers of the company include Pontifax Venture Capital (32.6% pre-IPO stake) and Arkin Bio Ventures (14.4%), as per Pitchbook.

However, the company made a loss of $1.3 million during the year ended December 31, 2018.

Unfortunately, its 2019 financials were worse:  Collaboration Revenue: $10M (flat); Operating Expenses: $20.6M (+76%); Net Loss: ($14.1M) (-513%); Cash Consumption: ($16.0M) (-129%).

Earlier this month, Keros had to resort to a $56 million Series C round. According to Statnews, the company, but for this funding, would not have lasted more than a few months.

Related Story:  Venture Capital: Who Will Dare to IPO After 2019’s List of Stumbles                                                 

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