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Biotech IPOs in the Time of Coronavirus

0 | By Alex Kagin

With COVID-19 dominating the news cycle, it is no wonder that biotech is front and center in people’s minds. Almost every day, we see news from companies like Moderna Inc. (MRNA), Gilead Sciences Inc. (GILD), Sorrento Therapeutics Inc. (SRNE), and many other companies racing to create a vaccine.

And even during this difficult time, the demand and need for vaccines and medical cures is so large that stock prices are jumping and companies are raising massive amounts of money.

Now, if you want to check out all of my latest research on how best to play this race so you can maximize your own share of the money that’s been pouring into the COVID-19 vaccine effort, just click here.

Pliant Therapeutics Inc. (PLRX) shares jumped over 50% in early July, and shares of Legend Biotech Corp. (LEGN) similarly jumped 61% on its market debut. Legend’s jump is not so surprising, as its Phase 1b/2 trial for cell therapy to treat multiple myeloma found that 100% of its 29 patients treated responded positively.

Biotech IPOs have also helped drug developers raise over $5 billion so far this year, and it doesn’t look like it will slow down.

This is why we are keeping an eye on most of the most recent biotech IPOs

Relay Therapeutics Inc. (RLAY) went public mid-July and raised $400 million in an upsized IPO.

This will help them push its pipeline forward in oncology. Relay is working to understand how proteins move along with how changes in their shape and structure can affect their function. This information will be used to create new drugs that can modify these changes to treat cancer. Relay is transforming the drug discovery process with an initial focus on enhancing small molecule therapeutic discovery and already has several drugs in the pipeline.

According to its S-1 filings, it is recruiting for a phase 1 clinical trial for RLY-1971, which would treat patients with solid tumors. It also has completed the Investigational New Drug process, enabling activities for RLY-4008, its inhibitor of fibroblast growth factor receptor 2 and expect to initiate a Phase 1 clinical trial in the second half of 2020.

This is only the start for them, with other studies coming in 2021.

I am also continuing to watch Schrodinger Inc. (SDGR) closely, as I first discussed here back in early June. This company with its unique physics-based drug discovery platform and drug pipeline has rallied nicely since we first discussed it, having been up over 30% at one point.

It has pulled back some, but that is expected as biotech stocks tend to be choppy trading around big news. Nothing has changed on my outlook for this stock, and I have even more faith in this company after recent developments.

Schrodinger recently announced a strategic partnership with Viva Biotech Holdings (VBIZF), a collaboration with Thermo Fisher Scientific Inc. (TMO) to expand structure-based drug discovery to novel targets using Cryo-EM, and have expanded its own discovery efforts to discover novel antiviral therapeutics as a part of a philanthropic global initiative.

And this growth within the biotech sector is more than just a trend – it’s becoming part of the road to wealth that’s paved by tech.

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