April 14, 2015 / 10:26 PM / 4 years ago

UPDATE 1-Aduro IPO pricing values drugmaker at $1 bln

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April 14 (Reuters) - Aduro Biotech Inc’s initial public offering has been priced at $17 per share, an underwriter said, valuing the cancer immunotherapy drug developer at about $1 billion.

The upsized offering, which was priced on par with the company’s expectation, raised about $119 million.

Aduro, which counts Johnson & Johnson and Swiss drugmaker Novartis AG among its investors, is selling all the 7 million shares in the offering.

The company, whose lead product is in midstage clinical trials for metastatic pancreatic cancer, had previously planned to sell 5 million shares at $14-$16 per share.

Cancer immunotherapy is one of the hottest areas of drug research. Aduro’s experimental STING (Stimulator of Interferon Genes) technology uses a next-generation method to harness the body’s immune system to combat cancer.

To gain access to Aduro’s cancer immunotherapy technology, Novartis last month entered into a tie-up worth about $750 million with the company.

Novartis Institutes for BioMedical Research Inc, an affiliate of Novartis, will buy about $25 million shares of Aduro in a concurrent private placement, according to the filing.

Johson & Johnson Innovation - the venture capital subsidiary of J&J - will buy up to $30 million shares, as a result of which its stake will increase to 8.4 percent from 6.3 percent after the offering.

Net proceeds from the offering will be used for clinical trials and for general corporate and working capital purposes, Aduro said.

Shares of Aduro are expected to start trading on Wednesday on the Nasdaq under the symbol “ADRO.”

BofA Merrill Lynch and Leerink Partners are the main underwriters for the offering. (Reporting by Avik Das in Bengaluru; Editing by Saumyadeb Chakrabarty)

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