Updated Version 2 - After expanding its IPO size, ADARx Pharmaceuticals' stock price surged on its first day on Nasdaq.

Analyst commentary added in paragraphs 5, 9, and 10

Pragyan Kalita

Reuters, September 25 - On Friday, ADARx Pharmaceuticals (ADRX.O) saw its shares rise 30% above their initial public offering (IPO) price, after the late-stage gene therapy developer raised $446.3 million through an upsized US IPO.

The stock opened at $22.10, above its IPO price of $17. The San Diego-based company sold 26.3 million shares at the upper end of its pricing range, up from a prior plan of just 21.9 million shares.

ADARx was founded in 2019 and its experimental drugs primarily target diseases related to the immune, kidney, cardiovascular, and nervous systems.

ADARx stated that pharmaceutical company AbbVie (ABBV.N) has agreed to invest up to $100 million in a concurrent private placement, giving it about a 4.9% stake post-IPO.

"Having a prominent investor like AbbVie makes the company stand out. Such external validation complements the appeal of its lead candidate, currently in Phase III trials, whose topline data is expected by the end of 2027," IPOX research associate Lukas Muehlbauer told Reuters.

Biotech has emerged as a highlight of this year's IPO market, with the IPO boom continuing into autumn as investors favor the sector for being relatively insulated amid the Iran war and disruption driven by artificial intelligence.

Drug developers City Therapeutics (link) and Iambic Therapeutics (link) filed for US IPOs this week, while Retension Pharmaceuticals and TRex Bio filed to go public last week (link).

Electra Therapeutics (ETRA.O) also raised $350 million through an upsized US IPO ahead of its listing last Friday. Since its debut, its shares have dropped about 21%.

"When it comes to the IPO pipeline for biotech companies, investors remain cautious, with particular focus on those with more mature clinical assets and strong cash reserves sufficient to reach key catalytic milestones," Muehlbauer said.

"ADARx also benefits from its broader platform, which can support multiple programs rather than relying only on the success of one or two assets."

(For the benefit of non-English speakers, Reuters has automatically translated its report into several other languages. Because automated translation may contain errors or lack necessary context, Reuters does not guarantee the accuracy of automated translation. Automated translations are provided solely for reader convenience. Reuters accepts no liability for any damage or loss due to the use of automated translation.)