Kala Pharmaceuticals Gears Up for IPO

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Kala Pharmaceuticals filed an amended S-1 form with the U.S. Securities and Exchange Commission (SEC) for its initial public offering (IPO). The company intends to price its 6.0 million shares in the range of $14 to $16 per share, with an overallotment option for an additional 900,000 shares. At the maximum price, the entire offering is valued up to $110.4 million. The company intends to price its shares on the Nasdaq under the symbol KALA.

The underwriters for the offering are JPMorgan, Merrill Lynch, Wells Fargo and Wedbush PacGrow.

This is a biopharmaceutical company focused on the development and commercialization of therapeutics using proprietary nanoparticle-based mucus-penetrating particles (MPP) technology, with an initial focus on the treatment of eye diseases.

MPPs are selectively sized nanoparticles and have proprietary coatings. Management believes that these two key attributes enable even distribution of drug particles on mucosal surfaces and significantly increase drug delivery to target tissues by enhancing mobility of drug particles through mucus and preventing drug particles from becoming trapped and eliminated by mucus.

The company has applied its MPP technology to create nanosuspensions of loteprednol etabonate, a corticosteroid designed for ocular applications, resulting in two product candidates in Phase 3 clinical development, KPI-121 1.0% for the treatment of inflammation and pain following ocular surgery and KPI-121 0.25% for the temporary relief of the signs and symptoms of dry eye disease.

Kala expects to submit New Drug Applications (NDAs) for these product candidates by the end of 2017 and the first half of 2018, respectively.

In the filing, the company detailed how it would be using the net proceeds:

  • Approximately $25.0 million to fund clinical development of our KPI-121 product candidates, including preparation of NDA submissions for KPI-121 1.0% for the treatment of post-operative inflammation and pain following ocular surgery and for KPI-121 0.25% for the temporary relief of the signs and symptoms of dry eye disease.
  • Approximately $30.0 million to prepare for commercialization of KPI-121 1.0% and KPI-121 0.25%.
  • Approximately $20.0 million to support the manufacture of a commercial supply of KPI-121 product candidates.
  • Approximately $0.5 million to fund early stage pipeline development programs.
  • The remainder for working capital and other general corporate purposes.