Precision medicine company Caris destroys bio-IPO drought, raising $494 million for cancer analysis tools
Cancer treatment continues to evolve to identify targets and genetic characteristics that guide the development of therapies that address these disease markers. Caris Life Sciences’ artificial intelligence-powered products can diagnose cancer and help oncologists determine which target therapy to use. Over the past 18 months, the company has launched two key products. Now, it has $494 million in IPO cash to support current precision medicine programs and expand its future approach to other therapeutic areas.
In an IPO environment where most people close their life science companies this year, Caris not only made its debut in the public market, but also made the deal lower. Investors expressed keen interest in the Irving, Texas-based company, which closed at $27.25 on Friday, up 29.7% from its IPO price in the first week of its deal. Caris’ stock symbol “CAI” in Nasdaq.
Caris provides molecular analysis services to analyze patient samples to diagnose cancer or guide treatment decisions. The company said in its IPO application that the business was rooted in the acquisition of the Institute for Molecular Profiles in 2008, and the company is developing a blood-based diagnostic platform for early stage cancer detection, treatment options and disease surveillance. Under Caris’ leadership, this tissue-based molecular analysis technology becomes MI Propers, a technology platform that includes the component MI Cancer Seek, a concomitant diagnosis that identifies patients that meet targeted therapies, and Caris Caris usevure, the company’s universal blood-based full-explanatory/whole transcriptome sequencing technology.
Analysis of patient tissues produces a large amount of cancer data. In recent years, Caris and other life science companies have changed in their ability to process and analyze the data they generate. Caris founder and CEO David Halbert said in a letter to investors included in the IPO filing that next-generation sequencing and other technologies required for personalized medicine did not exist when the company was started. Caris benefits from advances in sequencing technology, cloud computing and AI capabilities that can power its expertise and insights in molecular biology. He said these techniques allow Caris to find answers to biological questions that were previously unanswered due to limited or narrow information. Halbert said that when completing 6.5 million tests on more than 849,000 cases, Caris said that Caris generated more than 1,300 billion billion molecular data points and measured more than 38 billion molecular markers.
“We are using this massive amount of molecular information to facilitate the transition of intuitive medicine, in which case the decisions of cancer patients are based on previous experience or intuition, to empirical medicine, in which case decisions are based on the genetic composition of each person’s disease,” Holbert said.
Today’s Carris cancer may be a chronic disease tomorrow
Caris makes money by providing molecular analytics services to clinicians and R&D services in biopharmaceutical companies. In the filing, Carris said its technology has been used by more than 100 companies including Abbvie, Merck Kgaa and Moderna. Caris also has partnerships with academic and research institutions.
Last November, the FDA approved MI cancer sought to use as a partner diagnosis for certain targeted therapies in six cancer indicators, such as the Merck immunotherapy KeyTruda and the Pfizer kinase inhibitor Braftovi. The product was launched commercially in the first quarter of this year. In the first quarter of 2024, Caris launched Caris extensively to ensure cancer treatment choice. Caris’ competitors in tissue-based molecular analysis include Roche’s subsidiary Tempus and Foundation Medicine. In early blood-based cancer testing, competitors include Grail, Freenome, Guardant Health and Precision Science.
The IPO application shows that molecular profiles account for the majority of Caris’ $412.2 million revenue in 2024, up 34.6% from the previous year. In the first quarter of this year, revenue from molecular profile services was $114 million, an increase of 55.7% compared with the same period in 2024. Caris is not profitable yet, with a net loss of $281.9 million in 2024.
As of the end of the first quarter of 2025, Caris reported a cash position of $31.2 million. In April, the company raised $168 million in capital led by investment firm Braidwell, boosting its external transport of funds to $1.86 billion raised since 2018. The company said the capital will support the continued expansion of its technology platform. In the prospectus, Carris said that it has no specific plans except for general corporate purposes. But Holbert points to the potential expansion areas in his letter. He noted that CARIS performed the same assays in blood and tissue on each qualified patient sample, with the only change in the tests performed at the level of bioinformatics using different algorithms.
“While we specialize in oncology today, we also believe that since we have designed the Caris Aussure platform as a universal assay that runs on every coding gene in the blood, it can be used to identify changes that drive other chronic disease states such as cardiovascular disease, neurological disease, metabolic disease, etc.,” Halbert said.
Potential signs of thawing in the frozen biotech IPO market
Carris initially planned to offer 23.5 million shares, for $16 and $18, respectively. The company then sets the price range from $19 to $20 per share. When Caris finally priced on June 17, it could raise the deal to 23.5 million shares at $21 per share, raising $494.1 million.
According to the latest report from Partners DNB Bank and Back Bay Life Science Advisors, a total of $2.5 billion was raised in this year’s 13 healthcare IPOs. But most happen in the first two months of the year, and half of the finished products are from companies at the business stage. This is important because it shows that public market investors are more risky, and the IPO environment remains challenging for companies in the clinical stage.
Until 7 of the 13 IPOs are currently likely to trade below their issuance price. One of the exceptions is Asker Healthcare Group, a Swedish-based holding company whose subsidiaries are suppliers of medical products and equipment. Asker’s $888.1 million IPO in Nasdaq Stockholm is the largest healthcare IPO of the year, according to a DNB and Back Bay report. This may be good for Caris at the commercial stage.
IPO research firm Renaissance Capital said that stocks of CARIS and technically supported insurers have made gains in their IPO prices that exceed their IPO prices, saying investors are accepting growth stocks. But Renaissance CEO and co-founder Bill Smith noted in a weekly newsletter that obstacles remain, such as Middle East tariffs, interest rates and uncertainty in geopolitical conflicts. Smith said some of the uncertainties could be cleared after President Trump temporarily suspended tariffs in specific countries.
Ernst & Young said in the Beyond Border Report released last week that IPO activity is expected to remain silent for the foreseeable future. Citing drug developers, the consulting firm said that biotech is expected to continue to form partnerships with large pharmaceutical companies and find alternative sources of funding to continue developing its plans. But the signs that EY principal saw could help thaw the frozen biotech IPO market. In a briefing with journalists, Ernst & Young life sciences leader Arda Ural said the Senate passed President Trump’s budget bill, clarity on tariffs and potential Fed lower interest rates could all happen before the end of the third quarter of this year.
“If by October 1, I think it’s a very different market, and the one we’re looking for right now,” Ural said.
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