Just a few days ago, Madrigal Pharmaceuticals made history by winning FDA approval for its metabolic dysfunction-associated steatohepatitis (MASH) med Rezdiffra. Now that the launch is in sight, the company aims to raise hundreds of millions of dollars to help fuel its commercialization efforts.
The drugmaker is pricing 750,000 shares of its common stock at $260 apiece, plus it's selling pre-funded warrants to buy around 1.56 million shares for roughly the same price.
In all, Madrigal expects to raise some $600 million to support the launch of its recently approved MASH therapy Rezdiffra, which on Friday scored the first FDA nod for the disease.
The offering was upsized by $100 million after Madrigal originally proposed a $500 million offering on Monday.
Besides the launch effort, the money could be used for everything from R&D to potential acquisitions or licensing deals, the company said in a recent press release. The offering is expected to close March 21.
Madrigal is gearing up to launch the groundbreaking med during the second quarter of this year, the drugmaker said in a recent filing.
Rezdiffra is the first therapy cleared to treat MASH, also known as nonalcoholic steatohepatitis (NASH). Specifically, the drug’s label (PDF) covers MASH patients with moderate to severe liver fibrosis consistent with stages F2 and F3 of the disease.
MASH is estimated to impact some 5% of adults in the U.S., but it has been a notoriously tough field to break into. Intercept Pharmaceuticals appeared closest to an FDA approval before Madrigal, but the company was forced to change course after a second rejection for its treatment candidate last year.
Other biopharma players including Pfizer, Bristol Myers Squibb and Genfit have all tried to get into the NASH field as well. Madrigal’s offering, meanwhile, was the first to meet the goals of both MASH resolution and fibrosis improvement in a phase 3 study.
The company is pricing Rezdiffra at a wholesale acquisition cost of $47,400 before discounts. Analysts at Evercore ISI have previously pegged peak global sales at $5.5 billion, and the analyst team expects the drug to generate about $2.6 billion in 2030.
Crucially, the FDA’s approval comes without the requirement of a liver biopsy to determine patient eligibility. That was a major point of contention among investors ahead of the approval, as the invasive procedure would have constrained wide access to the med.