Six companies went public on April 22, the busiest day for IPOs since November 8, 2007. Although most of the companies came out at the bottom of their target price range, it is significant that all the companies got their deals done. It is also a sign that capital markets are improving and investors, who have been tight with their cash, are beginning to step forward if the deal is right.

 

The IPO of 2010, however, is not the one of earlier years. Investors remain risk averse, willing to fund only companies with revenues or promising late-stage products. Still companies are going public hoping to raise their value in the aftermarket.

Three life sciences companies completed their initial public offerings to begin trading in April. Codexis became the first cleantech company to go public after a more than year-long drought. Burrill & Company, the publisher of The Burrill Report, is an investor in Codexis. The company raised $78 million through the sale of 6 million shares at $13 a share, at the bottom of its target range of $13 to $15 to begin trading on the Nasdaq market under the symbol CDXS. Credit Suisse was the lead underwriter of the offering.

 

The Redwood City, California-based developer of biocatalysts used in the production of pharmaceuticals and renewable fuels and chemicals had originally hoped to raise $100 million. The company, with a market value of $540 million, had $83 million in revenue in 2009 and posted a $20 million loss for the year. Codexis has partnership agreements with Royal Dutch Shell, a major investor, Chevron, and pharmaceutical companies including Merck and Pfizer.

 

Codexis' IPO attracted a lot of interest from market watchers trying to gauge interest in the biogreentech sector. Although the company priced at the low end, its shares were trading up 8 percent at the end of Friday, a hopeful sign to other companies. Amyris Biotechnologies, another San Francisco Bay Area company in the renewable energy space, filed to go public through an initial public offering of up to $100 million of its common stock. Amyris uses synthetic biology techniques to engineer microbes in the production of renewable fuels and chemicals, and pharmaceuticals.

 

Investors seem to be less willing to take the risks involved in developing therapeutics. Alpharetta, Georgia-based Alimera Sciences' late-stage drug Iluvien is a treatment for diabetic macular edema, which can lead to blindness. The company went public at $11 a share, 29 percent below its target price range of $15 to $17, selling 6.5 million shares to raise $72 million and begin trading on the Nasdaq market under the symbol ALIM. Credit Suisse and Citi were the lead underwriters.  Share price remained unchanged at the end of the week. The company had raised $71 million in venture capital since its founding in 2004 from Scale Venture Partners, Domain Associates, Intersouth Partners, Polaris Venture Partners, and Venrock Associates.

 

DynaVox Technologies, the third life sciences company to go public on Thursday, is a digital health company that makes speech software and devices to assist people with hearing disabilities. DynaVox raised $140.6 million, selling 9.4 million shares at $15 a share, at the bottom of its price range. Piper Jaffray and Jefferies led the underwriters of the offering. Pittsburgh-based DynaVox, which will trade on the Nasdaq under the symbol DVOX, booked $105 million in sales in 2009. Shares ended the week up 1 percent.

 

Although, it's too early to know what the burst of IPOs portends for the future of the companies completing their offerings, it is a sign of a renewed interest on the part of public investors--who are hungry but cautious.

 

For a complete list of life science companies that have completed IPOs since the window cracked open in August 2009, see An Open Window. For a list of the companies in the IPO queue, go see Project Runway.