Dive Brief:

• ArriVent Biopharma is the second biotechnology company to go public this year, raising $175 million in an initial public offering Thursday that will support development of an experimental lung cancer drug.
• The company sold 9,722,222 shares at $18 apiece, surpassing projections set earlier this week. The bulk of that cash will go towards a drug called furmonertinib, which the company is developing for certain forms of lung cancer and could deliver Phase 3 results next year. 
• The raise follows CG Oncology’s $380 million IPO Wednesday, adding to signs of investor interest in new biotech stock offerings following a multiyear pullback. That interest appears focused on companies with medicines in advanced testing, however. Six of the last eight biotechs to price had drugs in Phase 3 trials, according to BioPharma Dive data. 

Dive Insight:

ArriVent is going public at a time when Wall Street investors want to see more from young biotechs than they did at the market’s peak. 

In 2020, only five of the 79 companies that went public had drugs in Phase 3 testing at the time of their IPO. In 2023, six of the 19 IPOs did. That trend is continuing this year, first with CG and ArriVent, and potentially with others behind them. Two other biotechs that filed for offerings in January, Alto Neuroscience and Kyverna Therapeutics, are in mid-stage testing. 

ArriVent’s pitch centers on furmonertinib, one of a competitive class of lung cancer medicines. Like Johnson & Johnson’s Rybrevant and Takeda’s Exkivity, it targets DNA insertions in the so-called exon 20 region of a gene called EGFR, which is damaged in a portion of non-small cell lung cancers. Several competitors including Dizal Pharma and Blueprint Pharmaceuticals are eyeing that target, too. 

ArriVent claims its drug can stand out. Takeda recently announced it’s withdrawing Exkivity from market after it failed a confirmatory trial, and Rybrevant is an intravenously administered biologic. ArriVent’s drug is a pill that may be more able to attack tumors that travel to the brain. It’s also being studied in another subset of lung cancer patients with PACC mutations, for which drugs of its kind aren’t often used. 

Phase 3 results in the former indication are expected in 2025, while data from a proof-of-concept study in PACC mutations should come this year. 

ArriVent licensed the drug from a Chinese biotech as part of a strategy to scoop up experimental medicines from China. The company also collaborates with startup Aarvik Therapeutics to make antibody-drug conjugates, an drug type drawing intense interest from drugmakers.

ArriVent’s ADC work is preclinical, however. It expects to select a lead drug prospect either later this year or early next, according to its IPO filing. 

The company’s stock will begin trading on Friday on the Nasdaq stock exchange under the ticker symbol “AVBP.”