Post IPO fall for Nightstar hits Syncona
A fall in the post IPO share price of Nasdaq-listed, UK-based gene therapy specialist Nightstar Therapeutics marred an otherwise strong performance for UK biotech investment trust Syncona (SYNC) in November, whose NAV dipped by 4% in the month, according to its latest monthly update. Syncona’s 42% ownership of Nightstar is worth c£160m and accounts for 15.7% of its NAV but had to be written down by £40m relative to October, when the stock was higher.
Nightstar’s lead programme is NSR-REP1, a gene therapy designed to modify or halt the progression of inherited retinal diseases that would otherwise progress to blindness and for which there are no currently approved treatments. it is being studied for choroideremia, a rare, degenerative, X-linked genetic retinal disorder primarily affecting males.
Nightstar is the largest of Syncona’s three core investments that collectively account for almost 36% of its NAV. Second-ranked Blue Earth Diagnostics, in which Syncona owns a 90% interest, is carried at £117m (11.9% of NAV) and its third holding in Oxford-based Autolus, in which it has a 38% share carried at £88m (8.6% of NAV). Autolus is a high-profile second-generation CAR-T therapy firm that also has backing from Arix Biosciences (13.5% of NAV) and Woodford Patient Capital Trust WPCT (4.4% of NAV).
Syncona was formed via last December’s merger of Battle Against Cancer Investment Trust (BACIT), a quoted fund of funds, with the Wellcome Trust’s venture arm. The company has a hybrid investment approach with the remainder of its assets invested in long-only and and alternative investment funds, which is considers to provide an evergreen funding base that will enable it to take a long term approach to investing in life sciences.
Syncona has seen its share rise from 130p to 200p this year and – rather unusually – it trades at a substantial almost 30% premium to NAV. This can presumably be attributed to the belief by investors that its private company holdings contain hidden value at their current valuations.
SYNC : Post IPO fall for Nightstar hits Syncona