Endocyte shares climb after IPO expectations cut

Shares of biotechnology company Endocyte Inc. rose in afternoon trading Friday, after the company slashed pricing expectations for its initial public offering.

The stock gained $1.73, or 29 percent, to close at $7.73 after the company dropped its offering price to $6 per share and boosted the number of shares to 12.5 million.

Previously, the company expected to offer just under 5.4 million shares at $13 to $15 apiece. Meanwhile, the company now expects to give underwriters the option to buy up to 1.8 million shares instead of 802,500 shares to cover excess demand.

Including the underwriters' options, the company could see proceeds of up to $86.3 million. It has said it plans on using "substantially" all of the proceeds to fund its operating plan.

The West Lafayette-based company does not yet market a product and has not yet reported a profit.

The company's key focus is on developing treatments for cancer and inflammatory diseases. The lead product candidate, EC145, is a potential cancer treatment. The company hopes to move it into late-stage development as a potential ovarian cancer treatment.

Competition in the market would include Roche, which is testing the drug Avastin as a potential ovarian cancer drug. Eisai Co. is also developing a potential ovarian cancer drug, as is Nektar Therapeutics and Eli Lilly and Co.

Endocyte is trading under the "ECYT" symbol on the Nasdaq.