Tranzyme has taken a time out in its trek to Wall Street.
The Durham drug-development company filed plans in November for an initial public offering of stock and was expected to make its debut on the Nasdaq this week.
But the deal has been pushed back until at least next week, a sign that the company may not be getting a welcome reception from Wall Street investors. That could force Tranzyme bosses and its investment bankers to delay the IPO, scrap it or accept a lower price.
"Deals will get done if it's the right deal," said David Menlow, president of IPOfinancial.com. "It's a deal that doesn't seem to be gathering much momentum."
Tranzyme officials, who are restricted in what they can say when an IPO is pending by securities regulations, declined to comment.
The stock-market rally is fueling demand for IPOs. So far, that hasn't trickled down to the Triangle, home to dozens of young companies eager for more investor attention. SciQuest, a Cary technology firm that went public in September, is the only successful IPO among local companies in the past year.
While the overall stock market was rattled recently by events in Japan and Libya, there is still pent-up demand for IPOs, said John Fitzgibbon, publisher of IPOScoop.com, another research firm.
That doesn't guarantee that Tranzyme, which is a risky bet with unproven products and limited revenue, will be able to get its deal done. It's still on a calendar of scheduled IPOs for next week, but isn't a sure thing.
"The music may be playing, but their name hasn't come up on the dance card," Fitzgibbon said.
An IPO would give Tranzyme more money to pay for further clinical tests of its drugs to treat gastrointestinal problems. Tranzyme planned to sell 5 million shares at $11 to $13 each, and raise about $53.8 million after expenses.
Tranzyme is testing a drug that helps restart the body's GI functions after bowel or abdominal surgeries. Another experimental medicine treats a stomach condition that afflicts diabetics.
But those drugs still require years of expensive clinical trials before Tranzyme can win approval from the Food and Drug Administration. In the meantime, Tranzyme is burning through cash for research.
Last year, the company lost $7.3 million. It did report revenue of $8.5 million, mostly from partnerships with other drug companies, including Bristol-Myers Squibb.
If Tranzyme can't get an IPO done, company officials probably will need to find other sources of money, including more private financing. The company has raised about $60 million from venture capitalists and had about $17 million of cash left as of Dec. 31.
The company, which has been run by CEO Vipin Garg since 2000, employs 40 people.