Yesterday, Flex Pharma (NASDAQ: FLKX) announced the pricing of its IPO of 5,400,000 shares of common stock at $16.00 per share. Both Derek Lowe and Adam Feuerstein have their suspicions about the company.
Flex is developing treatments for muscle cramps. Very good. Approximately 4 million U.S. adults over the age of 65 suffer from nocturnal leg cramps. Maybe the disease is not killing people, but it’s pretty inconvenient. There’s no treatment so far.
Flex’s scientific advisory board comprises four scientists of National Academy of Sciences including Roderick MacKinnon, Bruce Bean, David Julius, and Christopher Walsh. MacKinnon won the Nobel Prize in Chemistry in 2003 for his work on ion channels, and so his anti-cramping crusade seemed a natural extension of that work.
Flex was founded by Christoph Westphal in May 2014 and raised $40 million in September 2014. Several heavyweights including John Sculley (former Apple CEO), John Maraganore (Alnylam CEO), Michelle Dipp (OvaScience CEO), and Roger Tung (Concert CEO) stepped into the board of Flex.
Suspicions were roused on the therapy itself. It is a mixture of ginger extract, cinnamon extract, and capsicum, which are seasonings commonly added into Chinese food. Furthermore, the company intends to sidestep rigorous clinical trials by going the dietary supplement route.
Adam Feuerstein called Cristoph Westphal the biotech industry’s Arctic ice-cube salesman who has a knack for convincing unsuspecting investors and pharma companies to buy his food-as-medicine concoctions.
I just wonder what Flex is doing. Making drug or making money? Flex said “if the results of proof-of-concept studies are favorable, we intend to pursue the development of a drug product candidate.” Maybe we should wait more.