Venture Firms Offer to Invest in Revamped Horizon Pharma IPO

Jun 08 2011

NORTHBROOK, Illinois—Venture capital investors in Horizon Pharma Inc. may purchase $15 million in common stock in the drug developer’s initial public offering, which is being shepherded by a new group of underwriters, according to the company’s latest prospectus.

A group of seven venture firms that collectively hold three-quarters of the company’s shares have indicated interest in buying additional shares in the IPO, though no firm commitments have been made, according to an amended prospectus filed with regulators Tuesday.

The seven firms are Atlas Venture, Essex Woodlands Health Ventures, Global Life Science Ventures, NGN Biomed, Scale Venture Partners, Sutter Hill Ventures and TVM Life Science Ventures. Not mentioned was FirstMark Capital, which holds a 7.7% stake.

The new prospectus also indicates a new consortium of underwriters. Stifel Nicolaus Weisel, Cowen & Co. and JMP Securities are leading the offering, taking over from Jefferies Inc. and Piper Jaffray & Co. Lazard Capital Markets, which previously held a subordinate role alongside JMP, is no longer listed.

Horizon Pharma, based in Northbrook, Ill., is moving its first product, a treatment for signs and symptoms of arthritis called Duexis, toward commercialization after receiving Food and Drug Administration approval in April. The U.S. arm of Sanofi-Aventis SA has agreed to manufacture and supply the drug in the U.S. and Europe, pending the FDA’s go-ahead.

The launch of Duexis, expected in the U.S. in the fourth quarter, will be an important milestone for Horizon Pharma, which currently generates only a small amount of money from a second product called Lodotra in Europe. As of March 31, its accumulated deficit was $114.7 million.

Horizon Pharma has gotten by until now largely with the support of its venture investors and a series of loans. The company most recently received a $17 million loan from Oxford Finance LLC and Silicon Valley Bank earlier this month.

The company has applied to list on the Nasdaq Global Market under the symbol HZNP.

BY CHRISTOPHER ZINSLI
VentureWire Lifesciences Newsletter June 8th, 2011

http://www.horizonpharma.com