Biotech companies test public markets

A Conshohocken biotechnology company is finishing up its initial public offering on the stock market. It’s a fundraising move that few in this industry have been able to accomplish in recent years.

A Conshohocken biotechnology company is finishing up its initial public offering on the stock market. It’s a fundraising move that few in this industry have been able to accomplish in recent years.

The number of IPOs, when private companies go public, took a nose dive in 2008. Biotechnology companies were totally shut out of the IPO market until recently.

NuPathe, which is developing a migraine medication, is the latest local group to take the plunge. Earlier this year, the artificial bladder company Tengion, based in East Norriton, also did. David Hsu, a professor at the Wharton School, says the offerings signal an upturn for the markets, but only a tentative one.

Hsu: These companies are able to go public, but the pricing is not as favorable. And it’s perhaps more difficult than it has been in the past to maintain the prices as the companies go public.

Both companies downgraded how much they projected their stock would be worth. Hsu says having the option to go public may help companies attract investors while they’re still private.