Danish diabetes company Reapplix, co-founded by the inventor of Novo Nordisk's insulin pen, is planning to go public in Denmark next spring and for carrying out the IPO, the company has hired the investment banks Carnegie and ABG – this story was recently published in Danish business media Berlingske Business.
However, CEO in Reapplix, British Graeme Brookes, will neither confirm nor deny that an IPO is coming up, let alone that his company hired Carnegie and ABG to help.
"I have noticed the rumors – they came to me when I recently stepped out of the plane from a congress in San Francisco and read that an anonymous source said these things. But it is rumors, just rumors," maintains Brookes.
Wednesday, he attended the biotech conference Bio-Europe in Copenhagen to present the latest clinical results of his company's main asset – a biological patch for hard-to-heal diabetic foot ulcers.
The patch is made from the patient's own blood. Reapplix is planning to launch the product in Europe under the name Leucopatch and under the name 3CPatch in the US, where certain clinics already started using it.
Considers all types of financing
Judging from the presentation, there is a great interest in the company and its promising results. Therefore, the current rumors of Reapplix's IPO plans do not surprise Brookes.
"It does not surprise because we do have an interesting business case. We achieved good clinical results, and we already announced that we have to establish a commercial organization and that this obviously demands financing," he explains but adds:
"But, as I have previously mentioned, we are considering all types of financing opportunities."
Last year, Reapplix had a revenue of DKK 71,000 (around USD 10,800) while the company's net loss in 2017 was almost DKK 17 million compared to DKK 15 million the year before. According to the company's annual report 2017, its equity capital was DKK -16.9 million by the end of the year.
Honestly, I do not follow the Danish IPO climate very closely
However, the company is optimistic.
"We are excited for the future. With our technology, we have an opportunity to make a difference for the patients. Of course – like any company in the growth phase – we are moving from being a development company to a commercial firm, and it means that we have to finance it accordingly," says Brookes and adds:
"But currently, we do not want to discuss what the future capital structure will look like, what type of financing the company seeks or the timing of the financing."
Reapplix is owned by Novo Holding, Seed Capital and the Danish Growth Fund. CSO Rasmus Lundquist and COO Niels Erik Holm also hold part of the company.
Holm is the inventor of Novo Nordisk's insulin pen NovoLet and as late as October 2016, he and the other investors pumped around DKK 20 million more into Reapplix.
Stock market does not cause worry
Lately, the global stock market has been restless, which made the leading Danish share indices drop by six percent. The biotech companies Symphogen and Antibiotx recently postponed their plans of going public. Similarly, the parallel importer Abacus Medicine shelved its IPO in Germany for an indefinite period of time.
However, Brookes is not concerned about the Danish stock market situation.
"Honestly, I do not follow the Danish IPO climate very closely. We are a venture-financed company with strong venture funds as investors and so far, they have been very supportive. We anticipate that they will continue to be so and currently, I focus on how we are building up the business rather than tracking the IPO environment," he says.
In case you choose to go public, would that be in Denmark, Germany or elsewhere?
"First, we need to make sure whether we will take the IPO path. And then we will see where we go. But again, this is not something we want to comment on right now," says Brookes.
English Edit: Ida Løjmand
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