NuPathe follows Tengion's IPO trail

More than five weeks after Tengion Inc. netted $26 million from its initial public offering, another local life-sciences company hopes to travel the same path.

NuPathe Inc. of Conshohocken filed a registration statement with the Securities and Exchange Commission on Friday seeking to raise $86.3 million.

The specialty pharmaceutical company, which had 21 employees as of April 30, has been working on Zelrix, a single-use skin patch to treat migraines.

In its SEC filing, NuPathe said it completed a late-stage Phase III clinical trial in July 2009 of Zelrix, which would be a new way of administering sumatriptan, a widely prescribed migraine medicine. The company expects to submit a new-drug application with the Food and Drug Administration in the fourth quarter of this year.

NuPathe’s filing is the latest example of how much more activity there is in the IPO market this year. Renaissance Capital L.L.C., a Greenwich, Conn., research firm, has counted 103 filings as of Monday, compared with eight for the same period in 2009.

But investors buying shares in those IPOs had better keep their day jobs. Of the 49 IPOs that were completed so far, the average return on investment has been 1.5 percent.

Tengion, which is expected to release its first-quarter financial results Tuesday, went public at $5 per share. It closed Monday at $4.39, up 36 cents.

Like Tengion, NuPathe is unprofitable because it’s still in the development stages with its first product yet to reach the market. NuPathe was started in January 2005 by two women who have played key roles in other local pharmaceutical-industry start-ups.

Chief executive officer Jane H. Hollingsworth, 52, and president Terri B. Sebree, also 52, had been part of the 1999 launch of Auxilium Pharmaceuticals Inc., a Malvern specialty drug company that went public in 2004. They’d also worked together at Ibah Inc., a contract research organization that was acquired by Omnicare Inc. in 1998.

Hollingsworth and Sebree invested a total of less than $1 million to start NuPathe, which early on got a $500,000 investment from BioAdvance, the so-called life-sciences greenhouse funded by Pennsylvania’s share of the nationwide tobacco-litigation settlement.

In addition, NuPathe raised several rounds of venture capital, including a preferred-stock offering that raised $31.1 million between July 2008 and August 2009. Those investors included Quaker BioVentures, Safeguard Scientifics Inc., and SR One Ltd., all local venture- capital firms. (Quaker and Safeguard also backed Tengion.)

The prospectus for NuPathe does not list the number of shares it’s seeking to sell or a price range for them. Many companies, including Tengion, have had to cut their share prices in advance of going public.

NuPathe isn’t the only Philadelphia-area company that has made an IPO filing within the last month. So has Sabre Industries Inc., a North Wales-based designer and fabricator of towers, monopoles, and other structures for the communications and electric-power industries.

The Sabre IPO would raise about $144 million, but its prospectus indicates an undisclosed number of shares would be sold by certain stockholders - a transaction that would not generate capital for the Montgomery County company.