Turnstone Biologics rides biotech’s IPO train in Friday debut

Turnstone Biologics raised $80 million in a Friday morning IPO under the ticker $TSBX, bookending a rare two-week stretch for biotech listings.

The startup follows Apogee Therapeutics, Sagimet Biosciences and 60 Degrees Pharmaceuticals in going public in recent days, a feat that only a dozen drug developers have achieved so far this year amid a turbulent few years for the biotech sector. If underwriters exercise their option to purchase more stock, Turnstone’s IPO would become slightly larger than its $80 million Series D, announced two years ago to the day.

For Turnstone, it kicks off a turnaround story. The solid tumor biotech was ditched by AbbVie in 2021 and then further abandoned by Takeda last year, which led to a downsizing. At the end of last month, the biotech had 112 full-time employees.

On Monday, it set a price range of $12 to $14 per share, with the goal of selling 5.8 million shares in a transition into the public markets. It ultimately priced at the low end — $12 per share — but upsized its offering to nearly 6.7 million shares.

The biotech submitted its confidential registration statement to the SEC in May and flipped the filing public four weeks later — a relatively quick succession to capitalize on a rare IPO window.

The La Jolla, CA-based biotech might be the last to squeeze in an IPO before the summer concludes, as no other S-1s for drug developers have been publicly filed. More companies are expected to wait until after the Labor Day holiday to make their debut, bankers told Endpoints News earlier this month. Until then, the industry will keep an eye on the performances of recent Nasdaq entrants. As of Thursday’s closing bell, Apogee $APGE and Acelyrin $SLRN were still trading above their listing prices, while Sagimet $SGMT was about 30 cents below its debut.

The Nasdaq expects about another five to 10 biotech IPOs before year’s end, said Jordan Saxe, the exchange’s head of healthcare listings, in a July 18 interview. He expects 2024 to shape up to be a more active year based on conversations with industry leaders.

Sammy Farah

Most of Turnstone’s funds, about $70 million to $75 million, will go toward two clinical trials for its lead tumor-infiltrating lymphocyte therapy known as TIDAL-01, the company said in an SEC filing earlier this week. Investigators are testing the therapy’s potential in people with breast and colorectal cancer, as well as for uveal melanoma and other non-cutaneous and cutaneous melanomas.

The first clinical update will likely arrive in mid-2024. No TIL therapies have been greenlit by the FDA, but Iovance earlier this month shared that it’s aiming for accelerated approval. KSQ Therapeutics CEO Qasim Rizvi recently told Endpoints he expects his biotech to enter the clinic next year with a TIL.

The biotech is led by CEO Sammy Farah and Stewart Abbot (trained at Celgene, Fate and Adicet) runs the R&D organization. Its interim medical chief is Mike Burgess, who was previously at the company but briefly headed up R&D at Springworks Therapeutics. Ex-Seagen finance exec Venkat Ramanan is CFO.

Turnstone’s backers include Versant Ventures (whose managing director Jerel Davis chairs the board), OrbiMed, F-Prime Capital and FACIT, among other investors.

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