Dianthus raises US$250m for autoimmune drug
Dianthus Therapeutics secured US$250.8m on Tuesday from its first follow-on since listing two years ago in a reverse merger.
After one day of marketing, Jefferies, Evercore, TD Cowen and Stifel priced 7.6m shares at US$33, a 7.2% discount to Tuesday’s closing price but an impressive 3.7% file-to-offer premium from Monday’s US$31.80 closing price.
Predictably, the offering was upsized from US$150m targeted at launch.
The mid-stage biotech was riding a wave of enthusiasm for its lead drug in patients with a rare autoimmune disease that causes attacks of muscle weakness.
Dianthus shares rose 20% on Monday on promising Phase II trial results, plus another 11.9% while the deal was being marketed. The stock rose a further 6.5% on Wednesday to a closing price of US$37.90.
This was the first opportunity for investors to build significant positions in Dianthus since its 2023 reverse merger with Magenta Therapeutics, a once promising cancer specialist whose lead asset turned out to be unsafe.
Ex Magenta shareholders still own 21% of Dianthus.
Based on the Phase II trial results, Dianthus says its drug may provide best-in-class treatment for generalised myasthenia gravis (GMG), which the biotech thinks is an estimated US$3.5bn market opportunity.
Although there are already two approved treatments for GMG, those drugs have only made 10% penetration into the market. In addition to being more potent than existing drugs, Dianthus drug is potentially safer than approved treatments.
The biotech hopes to test that belief in a Phase III trial beginning later this year or in early 2026. Dianthus now has enough money to see it through to the beginning of 2028.