Exit of the Year: Nightstar Therapeutics

As in the preceding year, 2017 saw a relatively low level of initial public offerings among spinouts. In a sparse field, however, the successful flotation of Nightstar Therapeutics, which raised approximately $75m after listing on the Nasdaq exchange in October, made it a clear winner of the 2018 Global University Venturing Exit of the Year award.

Nightstar, known as NightstaRx until a pre-IPO rebrand, is a UK-based gene-therapy spinout from University of Oxford. The firm focuses on treatments for rare, inherited retinal diseases, in particular a condition known as choroideremia, which can lead to blindness.

Nightstar was established to commercialise research carried out by co-founder Robert MacLaren, the university’s professor of ophthalmology. The institution’s tech transfer office, Oxford University Innovation, first moved to protect his work in 2009.

Nightstar was spun out at the start of 2014 with $17m backing from Syncona, which at the time was a venture fund owned by charity Wellcome Trust

Prior to its October 2017 listing, the company had raised a total of $95.5m, including a $45m series C funding round in June 2017 featuring Wellington Management, Redmile, Syncona and New Enterprise Associates.

Shortly after the IPO, Nightstar announced it had licensed a proof of concept from Oxford University Innovation. The concept aims to counter a condition known as Stargardt disease, which is currently untreatable and can lead to blindness.

Publishing the firm’s 2017 results in April this year, Nightstar chief executive Dave Fellows said: “2017 was an exceptional year for the company. We set the stage for the recent initiation of the first-ever phase 3 trial in choroideremia and have announced further data supporting the durability of the treatment effect for NSR-REP1 in choroideremia.”

Nightstar said it expected the phase 3 trial to be fully enrolled by the first half of 2019.

Fellows added: “Elsewhere in our pipeline, we initiated our phase 1/2 gene therapy trial for X-linked retinitis pigmentosa and in-licensed our program for Stargardt disease. We also raised more than $130m of gross proceeds from our successful series C financing and IPO to continue our pioneering research and development activities.”

While the IPO has clearly proved successful for Nightstar itself, it will surely be of some concern to policymakers in the UK that such a promising company with headquarters in Britain has chosen to make its stockmarket debut on the other side of the Atlantic.