NovoCure Shares Tumble in Market Debut
October 02 2015 - 11:50AM
Dow Jones News
Shares in oncology company NovoCure Ltd. tumbled in their
trading debut Friday, the latest example of investors' lack of
appetite for biotechnology shares.
NovoCure shares opened at $20.16, below their initial public
offering price of $22 and valuing the company at about $1.67
billion. The company initially hoped to offer shares at $26 to $29
a piece but had cut that guidance to $23 to $24 amid growing
pressure on biotech stocks.
The stock, trading under the ticker "NVCR" on the Nasdaq,
recently moved at $19.30. The decline came amid a broader market
downturn, sparked by a disappointing employment report earlier
Friday morning.
NovoCure, founded 15 years ago by Dr. Yoram Palti in his
basement lab, is primarily concerned with using electrical fields
as noninvasive cancer treatments and uses tumor-treating fields to
disrupt cell division.
NovoCure has one drug approved by the Federal Drug
Administration, a treatment for recurrent glioblastoma brain
cancer. A treatment for newly-diagnosed glioblastoma is in
late-stage trials, and the company has about 15 other cancer drugs
in development.
To receive the treatment, a glioblastoma brain cancer patient
wears a portable electric field generator in the form of a bag
strapped onto the back. NovoCure said the therapy, designed to be
worn continuously, allows patients to go about their daily
activities.
In the most recent year, NovoCure reported a loss of $80.7
million, or $6.46 a share. Revenue grew 49% from a year earlier to
$15.5 million.
The company is based in Jersey Isle, one of the Channel Islands,
but has U.S. operations based out of New Hampshire.
The IPO comes as the biotechnology sector remains under pressure
Friday. An index of biotech stocks that trade on the Nasdaq slipped
0.4% in morning trading, adding to the 17% loss the basket has seen
over the past three months.
Many biotech stocks have no earnings or revenue, requiring
investor patience as companies test treatments and seek approval.
At the same time, soaring drug prices have commanded increasing
political attention that has given some investors pause. Still, the
sector has long been an investor favorite thanks to the prospect of
blockbuster drugs.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
October 02, 2015 11:35 ET (15:35 GMT)
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