St. Paul-based Squarex Withdraws IPO Plans
A St. Paul biotech company run by one-time gubernatorial candidate Hugh McTavish has shelved plans to go public, for now.
On Friday, Squarex Pharmaceuticals Corp. submitted paperwork asking the U.S. Securities and Exchange Commission to withdraw its IPO proposal “effective immediately or at the earliest practicable date hereafter.” The company, which is developing a novel treatment for cold sores, first filed its registration to go public in January.
In last week’s filing, Squarex provided few details about why it’s withdrawing its IPO plans. The company simply stated that it “opted not to pursue the offering.”
“The Company confirms that the Registration Statement has not been declared effective and that no securities have been sold pursuant to the Registration Statement,” Squarex said in the filing.
When reached by phone, McTavish said “it’s a rough market right now,” but noted that he does plan to go public later in the year. His plan is to raise some money privately and then go public.
Squarex is developing a treatment for cold sores that is administered on the arm. According to the company’s initial SEC filings, it’s still in the pre-revenue stage, and it has not secured full FDA approval for its product. IPO research firm Renaissance Capital reported that Squarex had hoped to raise about $15 million in the IPO.
As McTavish suggested, economic conditions aren’t especially favorable to IPOs at the moment. In the first quarter of 2023, the number of IPOs globally declined 8% year over year, according to a recent report by financial services firm EY. “Amidst persistent macroeconomic and geopolitical uncertainty, exacerbated by stress in the global banking system, IPO windows are fleeting and funding conditions are getting tougher, with investors prioritizing value over growth,” EY said in the report.
Locally, no Minnesota company has launched an IPO so far this year, despite the market’s breakneck speed in 2021.
And, for what it’s worth, it’s not entirely uncommon for companies to file for an IPO and then back out. A 2019 study said that as many as 30% of U.S. companies withdraw their IPO plans.
McTavish ran for governor of Minnesota in 2022 and secured less than 1% of votes. He ran as a candidate with the Independence-Alliance Party, once known as the Reform Party of Minnesota. Former Minnesota Gov. Jesse Ventura was elected to office as a Reform Party candidate back in the late ‘90s.
McTavish, who has a PhD in biochemistry and a law degree from the U of M, also founded the Covid Sanity project, which criticized state-mandated lockdowns and other governmental responses to the Covid-19 pandemic.
Aside from Squarex, McTavish has also founded another medical company known as IGF Oncology LLC, which has developed cancer treatment drugs.
