Third Harmonic shows flotations can happen

Third Harmonic’s Nasdaq debut yesterday shows that IPOs can get off the ground in the current market. The biotech looks set to raise around $185m after upsizing its offering earlier this week – the stock closed at $19.70 yesterday, after floating at $17. That reception might persuade others to test the waters, although the queue for now consists of a handful of much smaller potential deals. Only two other drug developers, Vitro Biopharma and Relief Therapeutics, have filed registration documents since August, seeking to raise $17m and $20m respectively, according to Renaissance Capital. Third Harmonic’s raise is the largest for biopharma since Hillevax banked $230m in May, and only the third flotation this quarter, according to Evaluate Pharma. Third Harmonic has only one product in the clinic, the phase 1 Kit inhibitor THB001, which the company plans to develop in a broad range of mast cell driven inflammatory conditions. As such, the group is hardly a safe bet, although two of its venture backers, Atlas and Orbimed, still own over 40% of the company. Early-stage developers have needed substantial backing from existing shareholders to get decent-sized IPOs off the ground for some time, and that looks unlikely to change.