Health and Healthcare

Collegium Pharmaceutical Prices Secondary Offering

Chris Lange

Published: January 8, 2016 10:35 am

Last Updated: January 13, 2020 3:16 pm

Collegium Pharmaceutical Inc. (NASDAQ: COLL) has registered an amended S-1 form with the U.S. Securities and Exchange Commission (SEC) regarding its secondary offering. The company just released the pricing for this offering at $20 per share. There are 2.75 million shares in the offering, with an overallotment option for an additional 412,500 shares. The entire offering is valued at $63.25 million.

The underwriters for the offering are Jefferies, Piper Jaffray, William Blair, Needham and Janney Montgomery Scott.

This specialty pharmaceutical company develops and plans to commercialize next-generation abuse-deterrent products that incorporate its patented DETERx platform technology for the treatment of chronic pain and other diseases. The lead product candidate, Xtampza ER, is an abuse-deterrent, extended-release, oral formulation of oxycodone, a widely prescribed opioid medication. On November 6, 2015, the U.S. Food and Drug Administration (FDA), granted tentative approval to the new drug application (NDA), for Xtampza for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate.

The FDA granted tentative approval because Xtampza met the required quality, safety and efficacy standards for approval but remains subject to an automatic stay of up to 30 months as a result of patent litigation filed by Purdue Pharma in March 2015. The FDA may grant final regulatory approval upon the earliest to occur of expiration of the automatic stay, the court invalidating Purdue’s patents or issuing an opinion of non-infringement and expiration of Purdue’s listed patents.

Xtampza has the same active ingredient as OxyContin OP, which is the largest selling abuse-deterrent, extended-release opioid in the United States by dollars, with $2.5 billion in U.S. sales in 2014. The company conducted a comprehensive preclinical and clinical program for Xtampza consistent with FDA guidance on abuse-deterrence. These studies and clinical trials demonstrated that chewing, crushing and/or dissolving Xtampza and then taking it orally or smoking, snorting or injecting it did not meaningfully change its drug release profile or safety characteristics. By contrast, clinical trials performed by the company and others — including a head-to-head clinical trial comparing Xtampza with OxyContin OP — have shown that drug abusers can achieve rapid release and absorption of the active ingredient by manipulating OxyContin OP using common household tools and methods commonly available on the Internet.

Collegium Pharmaceutical intends to use the net funds from this offering to develop its commercial infrastructure, to further develop its pipeline and for working capital and general corporate purposes.

Shares were down more than 6% Friday at $19.84, with a consensus analyst price target of $27.00 and a 52-week trading range of $11.92 to $30.58.