BridgeBio Oncology Goes Public via $450M SPAC Deal, Signaling Potential SPAC Resurgence

BridgeBio Oncology Therapeutics, a cancer-focused spinout from BridgeBio Pharma, is set to go public through a merger with Helix Acquisition Corp. II, a special purpose acquisition company (SPAC). The deal, valued at $450 million, marks a significant development in the pharmaceutical industry and potentially signals a revival of SPAC transactions in the biotech sector.

Deal Structure and Financial Details

The merger, announced on Friday, will provide BridgeBio Oncology with approximately $450 million in proceeds. This includes $196 million from Helix's trust account and $260 million in private investment in public equity (PIPE) financing. The PIPE was led by Cormorant Asset Management, with participation from funds affiliated with Deerfield Management Company and Novo Holdings.

Upon closing, expected in the third quarter of 2025, the combined entity will trade on the Nasdaq under the ticker symbol "BBOT." The deal values BridgeBio Oncology at $949 million, with the company projected to have access to about $550 million in cash post-closing.

BridgeBio Oncology's Pipeline and Strategy

BridgeBio Oncology, formerly known as TheRas, was spun out of BridgeBio in May 2024 with $200 million in initial funding. The company is focused on developing novel cancer therapies, including two KRAS inhibitors and a PI3Ka/RAS signaling modulator.

The company's lead programs include:

1. BBO-8520: Currently in a Phase I trial (ONKORAS-101) for KRASG12C mutant non-small cell lung cancer.
2. BBO-10203: In a Phase I trial (BREAKER-101) for various solid tumors, including HER2+ breast cancer, HR+/HER2- breast cancer, and KRAS mutant colorectal and non-small cell lung cancers.
3. BBO-11818: Expected to begin clinical trials in the first half of 2025.

CEO Eli Wallace stated that the SPAC deal provides "the optimal path to advance our programs," allowing the company to sidestep the challenging traditional IPO market for biotechs.

SPAC Resurgence and Market Implications

The BridgeBio Oncology deal comes amid signs of a potential resurgence in SPAC activity. After peaking in 2021 with 107 SPAC deals in the biotech sector alone, the market cooled due to poor returns and increased regulatory scrutiny. However, recent data from Renaissance Capital suggests a possible uptick, with 12 pricings and 17 initial filings reported as of mid-February 2025.

This deal may indicate a renewed interest in SPAC transactions as an alternative route to public markets for biotech companies, particularly in a challenging IPO environment. However, it's worth noting that the majority of SPACs that priced over the last five years still trade below their offering price, highlighting the risks associated with this approach.