Record raise sees Immunocore square up to its peers

Analysis

There is no disputing the fact that the $320m series A round completed today by Immunocore is a monster. It is bettered only by Moderna’s $450m raise in January, and is the largest private round ever for a European biotech, smashing UK biotech’s previous biggest venture financings (see tables below).

Even more impressive than this, however, might be that the deal values Immunocore at close to $1bn, as the UK group confirmed today. Still, this valuation means that Immunocore is still cheaper than listed groups working on engineered T-cell receptors, including its sister company Adaptimmune, which recently floated on Nasdaq.

The promise lies in Immunocore’s specific take on the cell therapy approach, using a soluble form of the T-cell receptor (TCR) that acts as a type of bispecific agent: one part binds the tumour antigen, while the other hits and activates T cells (Big pharma marks Immunocore as a cell therapy player to watch, June 29, 2014).

The group already counts Lilly, GlaxoSmithKline, Roche and AstraZeneca as discovery partners, and with such endorsement, if the technology pans out, its current $1bn valuation will look cheap. Juno Therapeutics, whose lead projects are CAR-Ts, is valued at $4.7bn, while Adaptimmune, which works on typical engineered TCRs, is worth $1.1bn.

Top 10 biotech VC rounds globally*
Company Financing date Investment ($m) Financing round Status
Moderna Therapeutics Jan 2015 450.0 Series D Active investment
Immunocore Jul 2015 320.0 Series A Active investment
Intarcia Therapeutics Apr 2014 200.0 Series H Active investment
Intarcia Therapeutics Nov 2012 160.0 Series G Active investment
Intrexon May 2013 150.0 Series F Exit (IPO)
Clovis Oncology May 2009 146.0 Series A Exit (IPO)
Juno Therapeutics Aug 2014 134.0 Series B Exit (IPO)
Juno Therapeutics Dec 2013 120.0 Series A Exit (IPO)
Moderna Therapeutics Nov 2013 110.0 Series B Active investment
Adaptimmune Sep 2014 104.0 Series A Exit (IPO)
Note: Data according to EvaluatePharma; *since 2008.

It is still early days, the $320m raise being a series A round, but already Immunocore has managed almost to set the record for a biotech VC round: only Moderna tops it in the post-credit crunch period that encompasses the current biotech bull run.

Followers of UK biotech will also be thrilled that Immunocore has basically rewritten the rulebook for the local sector, which has historically been plagued by an inability to raise sufficient cash.

Excluding Immunocore and Adaptimmune, which are both derived from the Avidex business bought and spun out by Medigene, you have to go back five years to the next biggest raise by a private UK biotech. That was Archimedes Pharma, which raised $100m and ended up being acquired by Kyowa Hakko Kirin last year for £230m ($360m).

The UK's top 20 VC rounds, 2005-14
Financing date Company Round Investment ($m)
Jul 2015 Immunocore Series A 320.0
Sep 2014 Adaptimmune Series A 104.0
Mar 2010 Archimedes Pharma Series undisclosed 100.0
Nov 2014 Cell Medica Series B 80.4
May 2005 Oxagen Series B 59.8
Apr 2014 NuCana BioMed Series B 57.0
Apr 2012 Circassia Series D 56.0
Apr 2006 Chroma Therapeutics Series C 53.0
Apr 2011 Circassia Series D 42.0
Feb 2005 Archimedes Pharma Seed capital 40.0
May 2014 Kymab Series B 40.0
Mar 2008 Vantia Therapeutics Series undisclosed 38.0
Oct 2010 Convergence Pharmaceuticals Series A 35.4
Jul 2012 PsiOxus Therapeutics Series B 34.0
Nov 2014 Ziarco Series B 33.1
Oct 2007 Syntaxin Series B 32.0
Oct 2014 Bicycle Therapeutics Series B 32.0
Nov 2013 Mission Therapeutics Series B 32.0
Jun 2014 Chronos Therapeutics Series A 32.0
Jun 2008 Creabilis Series A 31.1
Source: EvaluatePharma.

It would be premature to suggest that Immunocore signals a turnaround for UK biotech, but the presence of the UK fund manager Neil Woodford as a backer is also relevant. Woodford Investment Management was one of the new investors in Immunocore, and Mr Woodford has planned to target UK biotech via a recently created £800m fund, Woodford Patient Capital Trust.

Other new Immunocore backers include Malin Corporation, which put in $80m, Lilly and RTW Investments. There is no indication as to whether Medigene participated to any extent; if it did not it will have seen its previous 3% stake in the business diluted down to about 2%, with a value of around $20m.

Until the current round 97% of Immunocore was held by owners and affiliates of Adaptimmune, including Nicholas Cross and George Robinson – directors of both businesses. Immunocore, meanwhile, owned 7.6% of Adaptimmune before the sister company’s float.

This complex series of cross-holdings means that the backers of either company have an indirect interest in the other. This sets up various hypothetical business development scenarios, though exits for Immunocore’s private investors can at present only be guessed at.

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