Biotech Billionaire Says Market Not Ready for IPO
By CARLOS MARTINEZ
San Fernando Valley Business Journal
Entrepreneur Alfred E. Mann has decided to wait until early next year to take his biotech conglomerate MannKind Corp. public, despite plans for an initial public offering this summer.
“We met with bankers and they told me that, because of my track record with companies and my reputation, that we could go public now. But I don’t believe the market is ready,” Mann said.
UBS Warburg last year conducted a study of MannKind’s assets with a potential IPO in mind, Mann said, but he would not reveal how much it was valued at.
“All I can say is that it had a very healthy valuation,” Mann said, adding that proceeds from the initial public offering would fund research at MannKind’s companies.
Even with a personal fortune estimated at $1.6 billion, the IPO could give Mann the tools to build the next Amgen with one or all of his MannKind companies, said Kurt Kruger, an analyst for Bank of America Securities.
“They’re going to leverage Al Mann’s reputation and his nose for success,” Kruger said.
Brent Reinke, managing director of Crosby Heafey’s Westlake Village office, expects MannKind’s IPO to generate a lot of interest among investors. “These are companies with potential, and it’s going to help raise the profile of the whole biotech industry,” he said.
MannKind owns CTL, Second Sight Inc., AlleCure Corp. and Pharmaceutical Discovery Corp.
All four companies have the potential to develop a number of new products, analysts say, although none is likely to have the success of MiniMed, which Mann sold to Medtronic Inc. last year for about $3.7 billion.
Chatsworth-based CTL is developing a cancer vaccine, now in early clinical trials, that would reduce the size of tumors. Valencia-based Second Sight is developing eye implants that connect a video camera to a patient’s optic nerve.
AlleCure in Valencia is developing allergy vaccines to treat asthma. Pharmaceutical Discovery Corp. of Elmsford, N.Y. makes microscopic capsules containing proteins and peptides that can be inhaled or swallowed, making them more effective in delivering medicine.
Mann’s track record in creating and building successful companies includes his first firm, Spectrolab, an electrophysics company; Heliotek, a semiconductor firm; Pacesetter, a heart pacemaker manufacturer; Medtronic MiniMed, an insulin pump maker; and Advanced Bionics, a manufacturer of ear implants.
