Spruce Biosciences Raises $90 Million in IPO for Rare Endocrine Disease Therapies
October 9, 2020
Spruce Biosciences raised $90 million in an initial public offering of 6 million shares of its common stock at $15.00 per shares, making it the 20th rare disease focused biotech to go public year-to-date in 2020, a banner year for biotech IPOs.
These 20 companies together have raised $3.7 billion, or 35.2 percent of the $10.5 billion raised by 58 therapeutic drug developers in IPOs in 2020.
Spruce sold 1 million more shares than expected and priced in the middle of its proposed price range. The shares will trade on the Nasdaq Global Select Market under the symbol “SPRB.” In addition, Spruce has granted the underwriters a 30-day option to purchase up to an additional 900,000 shares of common stock at the public offering price less underwriting discounts and commissions.
Proceeds from the IPO will support late-stage development of the biotech’s lead compound tildacerfont, in development to treat classic congenital adrenal hyperplasia (CAH) and other rare endocrine disorders. Tildacerfont is a second generation CRF-1 receptor antagonist and the first non-steroidal molecule to demonstrate an ability to normalize elevated androgens in patients with CAH. It is currently in phase 2 studies for the treatment of adults with CAH, with a phase 2 trial in children planned in 2021.
CAH is a rare genetic disorder that affects the proper functioning of the adrenal glands, and results from a mutation in the gene that encodes the enzyme 21-hydroxylase, which is necessary for the synthesis of key adrenal hormones. As a result, people with CAH have an impaired ability to produce the hormone cortisol, which can result in life-threatening adrenal crises. Cortisol is also known as “the stress hormone,” and is critical for the body’s response to stress, illness and injury.
In CAH, the adrenal glands also often produce excessive levels of male sex hormones or androgens. While both sexes need androgens for proper growth and development, excess can cause problems that may include precocious puberty, short stature, hirsutism, increased risk of testicular adrenal rest tumors in men, and virilization and menstrual dysfunction in women.
While CAH testing is part of the newborn screening program, treatment options are limited. Glucocorticoids are commonly used to treat CAH but are associated with a wide range of side effects, including weight gain, stunted growth in children, reduced bone mineral density, metabolic abnormalities and increased cardiovascular risk. No new treatment options for CAH have been approved for the past several decades.
Results from a 12-week phase 2a study in adults with CAH, reported last year, showed that treatment with tildacerfont resulted in maximum mean reductions of up to 84 percent in adrenocorticotropic hormone, a key disease biomarker in CAH patients with elevated androgens, with the majority of treated patients seeing their ACTH levels normalize as a result of treatment. This may allow physicians to reduce the chronic, high-dose steroids used to treat CAH and improve control of the disease.
Tildacerfont has been granted orphan drug status by both the U.S. Food and Drug Administration and the European Medicines Agency.
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