Tranzyme (NASDAQ:TZYM) is a biopharmaceutical company which is developing treatments for gastrointestinal motility disorders. Tranzyme's lead drug, ulimeroelin, is in Phase 3 of clinical trials while its second drug is in Phase 2b. The drugs are designed to treat both chronic and accute gastrointestinal (GI) motility disorders, which are disorders where the normal movement of food through ones GI tract are disrupted. Tranzyme estimates that approximately 20% of adults worldwide have symptoms which would be treated by their drug candidates.
In June 2010, Tranzyme entered into a license agreement with a GI-focused pharmaceutical company called Norgine. The agreement gives Norgine exclusive rights to sell ulimorelin, the Phase 3 drug, in Europe, Australia, New Zealand, Middle East, North Africa, and South Africa. In return, Norgine will sahre the costs of the Phase 3 trials and Tranzyme will receive milestone payments and royalties from Norgine's sales.
The company's initial public offering of stock on the NASDAQ occurred on April 1, 2011. The company offered 13.5 shares each for $4. This was far below the initial price range of $11-$13. The company had originally planned to sell 5M shares, but drastically increased the offer size to match drop in price. The total offering was supposed to raise $60M, but price changed combined with drop in size offering brought the total deal to $54M. The lead underwriter of the deal was Citigroup (C).
Tranzyme is largely pre-revenue since it does not have any commercially available products yet. However, the company has made money through its license agreements and through funding for research. As a result, Tranzyme's total revenue in 2010 was $8.5M. This was a substantial increase over the 2009 total revenue of $.7M. The company reported a net less of $7.3M in 2010 and $11.2M in 2009. Things brings the company's total accumulated deficit to approximately $84.4M in 2010.