CG Oncology IPO rockets 96% in sign of pent-up deal demand

By Steve Gelsi

Cancer-medicine company closes at $37.17 a share, after pricing at $19 a share in deal that raised $380 million

Cancer-drug company CG Oncology Inc.'s stock nearly doubled in its trading debut Thursday, in a further sign that the drought of initial public offerings has come to an end in 2024.

Irving, Calif.-based CG Oncology's stock (CGON) closed its first day of trading at $37.17 a share, up 95.6% from its $19 IPO price and well above its opening trade of $29 a share.

CG Oncology's debut marked the latest sign of a revival in the IPO market after a lack of deals in 2023.

Amer Sports and BrightSpring are also on deck for stock-market debuts in coming days.

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Signs of a strong IPO for CG Oncology came late Wednesday, when the company priced $1 above its estimated price range of $16 to $18. CG Oncology also upped the size of the deal by 3 million shares, to 20 million shares, as investors clamored for stock.

At $19 a share, the IPO raised $380 million with underwriters Morgan Stanley, Goldman Sachs and Cantor Fitzgerald. Including an additional 3 million shares to be sold by underwriters, the deal will raise $437 million.

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CG Oncology is a late-stage clinical biopharmaceutical company that is developing cretostimogene, a bladder-cancer drug, and other treatments.

The company is backed by several private-equity and venture-capital firms, including ORI Capital, Decheng Capital Global Life Science Fund IV, Longitude Venture Partners, Kissei Pharmaceutical Co. Ltd, Foresite Capital, TCG Crossover Fund I and Ally Bridge Group.

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The company reported a $43.8 million net loss in 2022, wider than its 2021 net loss of $12.8 million.

It expects to report topline data by the end of this year in a Phase 3 clinical trial for cretostimogene.

CG Oncology's chief executive is 33-year-old Arthur Kuan, who has been in the position since 2017, when the company was founded. He's also a founding member of Ally Bridge Group, a healthcare investment platform.

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-Steve Gelsi

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01-25-24 1619ET

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