$115 Million Stock Offering by California State-backed Biotech Firm, Forty Seven, Inc.

A California company backed by the state's stem cell agency has announced that it is planning a $115 million initial public offering.

The firm -- Forty Seven, Inc., of Menlo Park -- filed a notice of its plans with the Security and Exchange Commission last Friday. The company has been awarded $15.2 million from the California Institute for Regenerative Medicine (CIRM), as the stem cell agency is formally known.

The company was founded by renown stem cell researcher Irving Weissman of Stanford University, who serves on the Forty Seven board of directors and who has a 9.5 percent equity interest in the firm.

John Carroll of Endpoint News this morning wrote:

"Forty Seven has an interesting past. The 78-year-old Weissman was able to wrangle substantial support for his early research work on CD47 from the California Institute for Regenerative Medicine, even launching early human studies — a rare feat in academic circles. Weissman and former CIRM chief Alan Trounson enjoyed a tight relationship, which extended to Trounson’s appointment to the board of another startup that Weissman had helped found — StemCells, Inc. —shortly after his departure from the agency. And Forty Seven is still getting money from CIRM under its latest $19 million grant."

The company said in its SEC filing,

"We are eligible to receive up to $19.2 million in grants from CIRM and the Leukemia and Lymphoma Society, or LLS, of which $11.6 million has been received through March 31, 2018."

Weissman has received  more than $34 million from the agency, part of the $360 million going to Stanford projects from CIRM, whose 29-member governing board has included a member from Stanford since 2004. Stanford ranks as the No. 1 recipient of funds from the $3 billion California stem cell agency, which is slated to run out of cash for new awards by the end of next year. 

For more on Forty Seven, see here and here.

Light Coverage of Cellular Dynamics IPO But One Exec Says It's Good for Stem Cell Biz

A handful of media outlets today carried stories about the public stock offering announced yesterday by Cellular Dynamics International, Inc., a Wisconsin firm that will benefit to the tune of $16 million-plus from the California stem cell agency.

Kathleen Gallagher of the Milwaukee Journal Sentinel described the company, founded by stem cell pioneer Jamie Thomson, as in the business of making “fully functioning human cells in industrial quantities.”

Judy Newman of the Wisconsin State Journal in Madison, where the company is based, quoted Beth Donley, chief executive of Stemina Biomarker Discovery, as saying,

“It can’t help but increase the value of other stem cell companies.”

Thomson is a professor both at the University of Wisconsin in Madison and at UC Santa Barbara, and we queried Dennis Clegg, co-director of the Center for Stem Cell Biology and Engineering at UC Santa Barbara, about the school's ties to Cellular Dynamics, which hopes to take in $57 million in its public offering.

He replied in an email that Santa Barbara has a collaboration with Cellular Dynamics and the University of Wisconsin to develop a vision-restoring, stem-cell-based therapy for people with advanced retinal diseases. That $900,000 effort is financed by the Foundation Fighting Blindness.

The California stem cell agency grant to Cellular Dynamics is for work at the stem cell bank being created at the Buck Institute in Novato, north of San Francisco.

The Milwaukee Business Journal and Genomeweb also carried stories on the IPO.

Cellular Dynamics: California Stem Cell Agency Recipient Plans $57 Million IPO

A Wisconsin firm that is the beneficiary of more than $16 million from the California stem cell agency today announced that it intends to go public to raise $57.3 million for its iPS cell ventures.

Jamie Thomson
UCSB photo

The firm is Cellular Dynamics International, Inc., and was co-founded by internationally known stem cell scientist Jamie Thomson of the University of Wisconsin, who is currently the company's chief scientific officer. Thomson is also a professor at UC Santa Barbara, where he is co-director of the Center for Stem Cell Biology and Engineering.

In March, the California stem cell agency awarded a $16 million grant to Cellular Dynamics to derive three iPS cell lines from 3,000 individuals as part of the agency's stem cell banking initiative. (Here is a link to the grant review summary.)

The company said in its SEC filings that it also will be the prime subcontractor on a $10 million grant that the Coriell Institute for Medical Research of Camden, N.J., received in the agency's stem cell banking round. Cellular Dynamics said some of the funds from the IPO will be used to complete its California laboratory in leased space at the Buck Institute in Novato, north of San Francisco.

Cellular Dynamics was founded in 2004 and sold its first commercial product in 2010. It reported revenues of $6.6 million in 2012 and losses of $22.3 million. It has 115 full-time and part-time employees worldwide.

The company said,

“During 2011 and 2012, we had three large biopharmaceutical customers that individually accounted for greater than 10% of our total revenue in one or both years. Eli Lilly and Company (Lilly) accounted for 10% of total revenue in 2011 and 18% of total revenue in 2012. Hoffmann-La Roche Inc. (Roche) accounted for 13% of total revenue in 2011 and GlaxoSmithKline plc (GSK) accounted for 11% of our total revenue in 2012.”

Cellular Dynamics also said in its filings,

“Our total revenue grew from $2.6 million in 2011 to $6.6 million in 2012, an increase of 154%. This growth was driven by a 247% increase in sales of our iCell products which grew from $1.5 million in 2011 to $5.2 million in 2012. At December 31, 2011, our backlog of revenue expected to be recognized in 2012 was $1.1 million. At December 31, 2012, our backlog of revenue expected to be recognized in 2013 had grown to $4.1 million.

“For the three months ended March 31, 2013 our total revenue was $2.4 million, an increase of 109% over the corresponding period in 2012. This growth was driven primarily by an increase in iCell product sales, which grew from $0.6 million for the three months ended March 31, 2012 to $1.8 million for the three months ended March 31, 2013, an increase of 173%.”

Paul Knoepfler of UC Davis, writing on his blog, touched on some of the aspects of the IP issues involving Cellular Dynamics and  Japanese researcher Shinya Yamanaka, who won the Nobel Prize last year for discovering how to reprogram adult stem cells into pluripotent cells (the iPS process).

 Knoepfler wrote,

"A recent question is the issue of who has the intellectual property (IP) rights to iPS cell technology. People have told me in the past that they wondered if Cellular Dynamics has unambiguous rights to develop all of these iPS cell-based products."

Knoepfler also wrote,

 “This (the IPO) looks to be very interesting and could transform the field as it develops.”

News coverage today of the IPO filing was light, but is more expected to surface tomorrow. Here is a link to the only story that had surfaced as of this writing. 

No price or date has yet been set for the offering.