July 24, 2015 / 9:48 AM / 5 years ago

AC Immune gets IPO ticket as Alzheimer's drug advances

(Reuters) - Swiss biotech firm AC Immune is one step closer to a potential stock market listing after a decision this week by partner Roche ROG.VX to advance its experimental Alzheimer’s drug crenezumab into pivotal clinical tests.

“It’s very significant for us,” Chief Executive Andrea Pfeifer told Reuters. “It validates our pipeline, it validates our technology and it gives us very nice push in valuation.”

No decision has been taken on an initial public offering (IPO) but Pfeifer said the market for biotech floats was buoyant and having a drug in late-stage development was a big plus.

The company, founded in 2003, could also sell itself to a larger drugmaker. It will decide on the best way forward in the coming months.

Crenezumab, which AC Immune licensed to Roche’s Genentech division under a deal signed in 2006, targets protein plaques found in brains of patients with Alzheimer’s.

It had disappointing results in a mid-stage trial last year but Roche has been encouraged by the promise of drugs from Eli Lilly (LLY.N) and Biogen (BIIB.O) that work in a similar way and believes it can do better by raising the dose.

Significantly, there appears to be scope to increase dosage without causing side effects since crenezumab binds very specifically to misfolded plaques without producing an inflammatory response.

AC Immune, backed by SAP (SAPG.DE) co-founder Dietmar Hopp, received an undisclosed milestone payment from Roche this week after crenezumab moved into Phase III testing. It is not under any financial pressure to come to market but is talking to banks as it considers its options.

“We are looking at the market, looking at our pipeline and putting everything together to make a decision which creates the best value for our shareholders,” Pfeifer said.

Another Alzheimer’s drug company, Axovant AXON.N, stunned many analysts in June when it came to market with a valuation of nearly $3 billion.

AC Immune, based in Lausanne, has a broader portfolio than Axovant, with three therapeutic products and one diagnostic test in clinical development.

In addition to the deal with Roche, it also has tie-ups with Johnson & Johnson (JNJ.N) and Piramal Healthcare.

Despite its Swiss roots, Pfeifer has an open mind on where it might be best to list, given the appetite for biotechs at present on Nasdaq.

“We will certainly look at Nasdaq as much as the European markets and choose which is best for our company, when we reach the stage of any decision,” she said.

Editing by David Evans

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