If you think an IPO calendar cluttered with biopharmaceutical deals and a giant REIT offering is boring, you might want to give it a second thought.

True, this week’s new-issue calendar does have six biopharmaceutical companies hoping to go public, plus a $1-billion real estate investment trust offering. But let’s take a closer look.

Investors’ take on biopharmaceutical IPOs has been one of disinterest. After all, these companies are generally speculative in nature with developing products that have yet to generate any significant revenue and, in the process, are gushing with millions of dollars of red ink.

To get a biopharmaceutical deal out the door, here’s what usually happens. The deal gets priced below its filing range, struggles in the aftermarket, and then everybody goes on to the next deal without a backward glance.

The legendary baseball Hall of Fame member, Satchel Paige, who was as well known for his philosophy on life as he was for his pitching ability, once said, “Don’t look back. Something might be gaining on you.”

The same can be said about today’s biopharmaceutical IPOs.

Here’s a surprise.

The top-performing IPO of this year’s traffic is a biopharmaceutical company:

Acorda Therapeutics is a Hawthorn, New York-based biopharmaceutical company that is developing novel therapies to improve neurological function in people with multiple sclerosis, spinal cord injury, and other disorders of the central nervous system.

The company offered 5.5 million shares at $6 each on February 9. It was priced 50 percent below its filing range of $11 to $13 per share. The IPO opened at $6.17 and closed its opening day at $6.72. Then it started a downslide to Friday, September 22, when it closed at $2.20 per share, down 63.3 percent from its initial offering price.

Catching Lightning in a Bottle

Over the weekend of September 22, Acorda announced it had received a positive result from its Phase III clinical trial for its lead MS drug, Fampridine-SR.

The stock never looked back.

On Thursday, October 19, Acorda closed at $17.15 per share, up 185.8 percent from its initial offering price.

Another of this year’s 100 percent aftermarket performers is also a biopharmaceutical IPO:

Omrix Pharmaceuticals is a New York City-based commercial-stage biopharmaceutical company developing biological products derived from human plasma.

The company offered 3.4 million shares at $10 each on April 20. It was priced 37.5 percent below its filing range of $15 to $17 per share. The IPO opened at $9.91 and closed its opening day at $10.03 per share.

Since going public, Omrix has had a series of announcements, some more favorable than others, that have attracted investors’ interest. The IPO sold at a high of $20.99 per share on October 11, and closed on Thursday, October 19 at $20.06, still up 100.6 percent from its initial offering price.

The REIT

Real estate investment trust IPOs have rarely, if ever, been on anybody’s “Most Wanted” list. Usually, investors have been known to avoid them.

Only two REIT IPOs have been priced this year. Both were priced below their filing ranges and each closed their opening day of trading below their initial offering prices.

Things could change.

There is a blockbuster REIT waiting to be priced this week. The deal is expected to raise $1.1 billion:

Douglas Emmett is a Santa Monica, California-based real estate investment trust, which will be one of the largest owners and operators of high-quality office and multifamily properties in Los AngelesCounty. The company also has a growing presence in Honolulu.

The company owns about 55 properties, generating about $373 million in annualized rent.

One IPO expert living in the Los Angeles area, who asked not to be identified, said he knows these properties and, in his opinion, “they cannot be replaced.”

Los Angeles

There are unconfirmed rumors that Douglas Emmett’s 55 million shares at $19 to $21 may be oversubscribed and institutional interest is reportedly building.

This coming week’s IPO calendar lists eight offerings, plus three carryovers.

Inside This Week’s IPO Calendar

Here’s the industrial sector breakdown for the new faces on this week’s IPO calendar: Three biopharmaceutical companies (Achillion Pharmaceuticals, Cadence Pharmaceuticals, and Catalyst Pharmaceutical Partners), a Chinese hotel operator (Home Inns & Hotel Management), a natural gas limited partnership (Eagle Rock Energy), a new media publisher (GateHouse Media), a REIT (Douglas Emmett), and a telecommunications equipment supplier (Optium).

They plan to raise $1.89 billion.

The Biopharmaceuticals

Achillion Pharmaceuticals is a Fredericksburg, Maryland-based biopharmaceutical company developing innovative treatments for infectious diseases, such as HIV infection and chronic hepatitis C, as well as antibacterial treatments for serious hospital-based bacterial infections.

Achillion Pharmaceuticals plans to price 4.5 million sharesat $14 to $16 each to raise $67.5 million. The IPO is to start trading on Wednesday.

As of June 30, 2006, Achillion Pharmaceuticals reported an accumulated deficit of $107.3 million.

Achillion Pharmaceuticals

Formed in 1998, Achillion Pharmaceuticals has about 63 employees.

Achillion Pharmaceuticals

Underwriters: Cowen and CIBC World markets are the joint-lead managers. Acting as a manager is JMP Securities

lead managers. Acting as a manager is JMP Securities

Selected Principal Shareholders: Atlas Venture Fund, Schroder Ventures International Life Sciences Fund, Advent International, Bear Stearns Health Innoventures, SGC Partners, and Connecticut Innovations

Cadence Pharmaceuticals isa San Diego, California-based biopharmaceutical company developing product candidates for use in hospital settings, such as intravenous formulation of acetaminophen, and products to prevent and treat device-related, surgical wound-related, and burn-related infections.

Cadence Pharmaceuticals plans to price 6 million shares at $11 to $13 each to raise $72 million. The IPO is to start trading on Friday.

As of June 30, 2006, Cadence Pharmaceuticals reported an accumulated deficit of $46 million.

Cadence Pharmaceuticals

Formed in 2004, Cadence Pharmaceuticals has about 24 employees.

Cadence Pharmaceuticals

Underwriters: Merrill Lynch is the lead manager. Acting as co-managers are Deutsche Bank, Pacific Growth Equities, and JPM Securities.

lead manager. Acting as co-managers are Deutsche Bank, Pacific Growth Equities, and JPM Securities.

Selected Principal Shareholders: Domain Associates, ProQuest Investments, Frazier Healthcare, Versant Ventures, Technology Partners, BB Biotech Ventures, and Trafalgar Court

Catalyst Pharmaceuticals Partners is a Coral Gables, Florida-based specialty pharmaceutical company developing prescription drugs to treat addictions, including cocaine addiction, methamphetamine addiction, and other addictions. Those include nicotine, prescription pain medications, alcohol, marijuana, and certain disorders, such as obesity and compulsive gambling.

Catalyst Pharmaceuticals Partners plans to price 3 million shares at $11 to $13 each to raise $36 million. The IPO is to start trading on Friday.

As of June 30, 2006, Catalyst Pharmaceuticals Partners reported an accumulated deficit of $3.7 million.

Catalyst Pharmaceuticals Partners

Formed in 2002, Catalyst Pharmaceuticals Partners has four employees.

Catalyst Pharmaceuticals Partners

Underwriters: First Albany is the lead manager. Acting as a co-manager is Stifel Nicolaus

Albany

52-Week Percentage Change:

Dow Jones U.S. Pharmaceuticals and Biotechnology Index: up 11.8 percent

Nasdaq Composite Index: up 13.2 percent

The REIT

Douglas Emmett is a Santa Monica, California-based real estate investment trust. Upon consummation of the offering, Douglas Emmett will be one of the largest owners and operators of high-quality office and multifamily properties in Los AngelesCounty and a growing presence in Honolulu. The company’s property portfolio focuses on top-tier office properties within these submarkets. Its properties are located near high-end executive housing and key lifestyle amenities.

Douglas Emmett plans to price 55 million shares at $19 to $21 each to raise $1.1 billion. The IPO is to start trading on Wednesday.

The partnership plans to pay cash dividends of $0.175 per share for a full quarter, or $0.70 per share on an annualized basis.

Formed in 1971, Douglas Emmett has about 400 employees.

Douglas Emmett

Underwriters: Lehman Brothers, Merrill Lynch, and Citigroup are the joint-lead managers. Acting as co-managers are Wachovia Securities, UBS Investment Bank, Banc of America Securities, A.G. Edwards, Raymond James, Wells Fargo Securities, and BMO Capital Markets

Selected Principal Shareholders: All directors, director nominees, and executive officers as a group will own about 40.8 million shares.

52-Week Percentage Change:

Dow Jones U.S. Real Estate Investment Trust Index: up 35.4 percent

U.S.

Nasdaq Composite Index: up 13.2 percent

The Rest

Eagle Rock Energy Partners, L.P. (NASDAQ: EROC proposed) is a Houston-based limited partnership engaged in gathering, compressing, treating, processing, transporting, and selling natural gas and fractionating and transporting natural gas liquids. It has assets located in the Texas Panhandle, southeastern Texas, and Louisiana.

Eagle Rock Energy Partners plans to price 12.5 million common units at $19 to $21 each to raise $250 million. The IPO is to start trading on Wednesday, October 25.

The partnership plans to make a quarterly distribution of 36.25 cents per unit.

Formed in 2002, Eagle Rock Energy Partners has about 150 employees.

Eagle Rock Energy Partners

Underwriters: UBS Investment Bank, Lehman Brothers, and Goldman Sachs are the joint-lead managers. Acting as co-managers are A.G. Edwards, Wachovia, Credit Suisse, Raymond James, and RBC Capital Markets

lead managers. Acting as co-managers are A.G. Edwards, Wachovia, Credit Suisse, Raymond James, and RBC Capital Markets

Selected Principal Shareholders: Eagle Rock Holdings

52-Week Percentage Change:

Dow Jones U.S. Gas Distribution Index: up 11.8 percent

U.S.

Nasdaq Composite Index: up 13.2 percent

GateHouse Media (NYSE: GHS proposed) is a Fairport, New York-based publisher of locally based print and online media. The company offers about 423 community publications and more than 230 related web sites. It serves over 125,000 business advertisers and its publications reach about 9 million people a week.

GateHouse Media plans to price 11.5 million shares at $16 to $18 each to raise $195 million. The IPO is to start trading on Wednesday.

For the year ending December 31, 2005, GateHouse Media reported a pro forma net loss of $14.8 million on pro forma total revenues of $384.5 million compared with a net loss of $24.8 million on total revenues of $200.1 million for the same period a year ago.

GateHouse Media

Formed in 1997, GateHouse Media has about 3,900 employees.

GateHouse Media

Underwriters: Goldman Sachs and Wachovia are the joint-lead managers. Acting as co-managers are Bear Stearns, Allen & Company, and Lazard Capital Markets.

lead managers. Acting as co-managers are Bear Stearns, Allen & Company, and Lazard Capital Markets.

Selected Principal Shareholder: Fortress Investment Holdings

52-Week Percentage Change:

Dow Jones U.S. Publishing Index: down 2.31 percent

U.S.

Nasdaq Composite Index: up 13.2 percent

Home Inns & Hotel Managementis a Shanghai-based economy hotel chain operating about 63 leased-and-operated hotels, with another 33 under development, and 19 franchised-and-managed hotels in about 40 cities in China.

Home Inns & Hotel Management plans to price 7.9 million American Depositary Shares (ADS) at US$10 to US$12 each to raise $86.9 million. Each ADS represents two ordinary shares. The IPO is to start trading on Wednesday.

For the six months ending June 30, 2006, Home Inns & Hotel Management reported net income of RMB27.2 million (US$3.4 million) on total revenues of RMB249.1 million (US$31.2 million) compared with net income of RMB8.3 million ($1.05 million) on total revenues of RMB107 million ($13.5 million) for the same period a year ago.

Home Inns & Hotel Management

Formed in 2002, Home Inns & Hotel Management has about 3,857 employees.

Home Inns & Hotel Management

Underwriters: Credit Suisse and Merrill Lynch are the joint-lead managers. Acting as a co-manager is Deutsche Bank

lead managers. Acting as a co-manager is Deutsche Bank

Selected Principal Shareholders: Poly Victory Investments Limited, AsiaStar IT Fund, IDG Technology Venture Investments, Susquehanna China Investment, and Kangaroo Investments

52-Week Percentage Change:

Dow Jones U.S. Hotel Index: up 26.7 percent

U.S.

Nasdaq Composite Index: up 13.2 percent

Optium is a Chalfont, Pennsylvania-based supplier of high-performance optical subsystems for use in telecommunications and cable TV network systems. The company designs a suite of optical subsystems that enables transmission, reception, and switching functionality for high-bandwidth optical networking applications.

Optium plans to price 5.2 million shares at $13.50 to $15.50 each to raise $75.4 million. The IPO is to start trading on Friday.

For the year ending July 29, 2006, Optium reported a net loss of $8.1 million on revenues of $69.5 million compared with a net loss of $1.5 million on revenues of $37.1 million for the same period a year ago.

Optium

As of July 29, 2006, Optium reported an accumulated deficit of $57.6 million.

Optium

Formed in 2000, Optium has about 165 employees.

Optium

Underwriters: Morgan Stanley and Credit Suisse are the joint-lead managers. Acting as co-managers are Cowen and Jefferies

lead managers. Acting as co-managers are Cowen and Jefferies

Selected Principal Shareholders: Battery Ventures, KPLJ Ventures, TL Ventures, and TPG Ventures

52-Week Percentage Change:

Dow Jones U.S. Semiconductor Index: up 6.22 percent

U.S.

Nasdaq Composite Index: up 13.2 percent

The Carryovers

BioVex Group, ofWoburn, Massachusetts, is a clinical-stage biotechnology company that is focusing on the development of targeted treatments for cancer and the prevention of infectious disease. It plans to price 3.4 million shares at $11 to $13 each to raise $40.8 million. The underwriters are Janney Montgomery Scott and Stifel Nicolaus. The selected principal shareholders are funds affiliated with Merlin Biosciences, Innoven Partenaires, Credit Agricole Private Equity, Lloyds Development Capital, Scottish Equity Partners, WestLB AG, GeneChem Therapeutics Venture Fund, ABN AMRO Participaties B.V., and V-Sciences Investments Pte. The IPO is now listed as “day to day.”

ImaRx Therapeutics,ofTucson, Arizona, is a biopharmaceutical company developing therapies for vascular disorders associated with blood clots. ImaRx Therapiesplans to price 5 million shares at $10 to $12 each to raise $55 million. Underwriters: CIBC World Markets, Jefferies, and First Albany Capital. A selected principal shareholder is Edson Moore Healthcare Ventures. The IPO is still listed as “day to day.”

Rosetta Genomics Ltd., of Rehovot, Israel, is a development-stage company seeking to develop and commercialize new diagnostic and therapeutic products based on a recently discovered group of genes known as microRNAs. Rosetta plans to price 3 million shares at $11 to $13 each to raise $36 million. The underwriters are C.E. Unterberg Towbin, Oppenheimer, and Maxim Group. The selected principal shareholders are Kadima Hi-Tech Ltd., Harmony 2000, Instanz Nominees Pty Ltd., and Insight Capital Ltd.The IPO is still listed as “day to day.”

They expect to raise $131.8 million.

Contact the writer:Editorial@RedHerring.com

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