ASH sparks biotech funding bonanza
Driven by a perfect storm of stock gains, an uptick in sector M&A and the afterglow of a major healthcare conference, biotech issuance resumed in force as eight drug developers combined for a record US$3.5bn on Tuesday night from marketed stock sales.
“By the amount of proceeds in a single night, Tuesday was the busiest day ever in biotech,” said one life science-focused ECM banker.
Despite a slow start to the year, biotech stocks rallied in the second half of 2025 with the NYSE Arca Biotechnology Index up 27% year-to-date, versus a 17% gain in the S&P 500.
In addition to strong share price performance, the American Society of Hematology’s annual meeting that concluded on Tuesday was another catalyst for fundraising as were positive trial results.
From the ASHes
Terns Pharmaceutical, a Phase I developer of leukaemia drugs, pivoted from presentations of data at ASH into an upsized US$650m follow-on stock sale, 62.5% more than the original US$400m sum targeted at launch.
After soaring 37% on Monday, Terns’ shares rose another 5.8% to US$42.57 on Tuesday as the deal was in the market.
Joint bookrunners Jefferies, TD Cowen and Leerink Partners priced 16.3m shares at US$40, a 6% discount to last sale but a slim 2.5% file-to-offer discount from Monday's closing price of US$40.23.
At ASH, Terns presented Phase I trial results showing 64% response rate among leukaemia patients tested, rising to 75% at the higher dosage it plans to use in the Phase II trial.
Terns thinks its drug has best-in-disease potential for patients with relapsed myeloid leukaemia. If the drug is approved, Barclays’ analysts project peak annual sales of US$2.5bn.
Terns has just over US$900m of cash, enough to fund advanced trials of its leukaemia drug through 2028 and beyond.
Fulcrum Therapeutics used its presentation at ASH for its sickle cell disease drug as a springboard for raising US$175m from a one-day marketed follow-on, a more modest (than Terns) 16.7% upsize from the original US$150m funding target.
After soaring 45.9% ahead of the deal launch on Monday, Fulcrum shares rose another 12.4% to US$14.60 ahead of pricing.
JP Morgan, Leerink Partners, Cantor and Oppenheimer priced 13m shares at US$13.50, a 7.5% discount to the close but a file-to-offer premium from Monday's US$12.99 closing price.
In the Phase Ib trial results presented at ASH, expectant mothers with SCD who took Fulcrum’s drug demonstrated meaningful increases in foetal haemoglobin levels after just six weeks of treatment.
Fulcrum added to the US$200.7m of cash it had in place as of September 30, which it had said was enough to fund development through the end of next year.
If approved, analysts at Truist Securities estimate peak annual sales for Fulcrum’s SCD drug at US$860m by 2034.
Attendance at ASH was not a prerequisite for raising capital last week.
Denali Therapeutics (US$200m), Dyne Therapeutics (US$350m), Kymera Therapeutics (US$602m), Structure Therapeutics (US$650m), Vera Therapeutics (US$291m) and Wave Life Sciences (US$350m) were not at ASH but still raised capital on Tuesday night.
Overall, seven of the eight deals were upsized after one day of public marketing and all traded above issue.
“Deals are working and that helps everyone," said the banker.