Biotech stocks have been market laggards this year, but that hasn’t diminished investor appetite for the initial public offerings of biotech startups.
A pair of drug developers — Intellia Therapeutics Inc. of Cambridge and Spring Bank Pharmaceuticals Inc. of Milford — were the latest to go public. Both made their debut on the Nasdaq exchange Friday after IPOs that reflected continued demand for biotechs.
“These biotech companies aren’t businesses; they’re research-and-development projects,’’ said Lexington life sciences consultant Harry Glorikian. “There are investors who are really into the science, and they’re trying to identify something that’s going to hit.’’
Intellia sold 6 million shares at $18 apiece, the top of its projected range, raising $108 million. Spring Bank sold 920,000 shares at $12 each, the low end of its range, raising $11 million. Their opening-day performances diverged, with Intellia’s shares shooting up more than 23 percent and Spring Bank’s falling more than 7 percent.
The offerings come at a time when the benchmark Nasdaq Biotechnology Index is down nearly 25 percent since the start of the year, even as the broader Standard & Poor’s is flat.
But of the 18 companies that have gone public on the Nasdaq so far this year, 11 have been in the biopharma or health care field. And five have been from Massachusetts.
In addition to the IPOs of Intellia and Spring Bank this week, Editas Medicine Inc. of Cambridge raised $94.4 millionin February and Proteostasis Inc. of Cambridge raised $50 million that same month. Waltham’s Syndax Pharmaceuticals Inc. raised $52.8 million in March. All are trading above their issue prices.
Biotech shares, which had outperformed the general market for much of the past five years, began falling out of favor late last year amid concerns the sector was overvalued and fears that a growing backlash against high drug prices could hurt the economics of the business.
But not all biotech companies are being shunned.
After a three-year run-up, investors are being more selective and focusing on companies working on promising science, suggested life sciences advisor Leora Schiff, principal at Altius Strategy Consulting in Somerville. Intellia, for example, is developing drugs in an emerging gene-editing niche called Crispr-Cas9. Spring Bank, meanwhile, is developing a new class of antivirals in an established field that has recently seen renewed interest.
“There’s still a lot of money out there,’’ Schiff said. “It’s just a question of where the money is going. Crispr-Cas9 has become such a hot area. And hepatitis B has become very interesting. The success of the hepatitis C drugs has revitalized that whole [antivirals] area.’’
Shares of Intellia ticked up $4.17 to $22.17 on Friday, a gain of 23.2 percent. Spring Bank shares, dropped 85 cents to $11.5, a loss of 7.1 percent.
Robert Weisman can be reached at robert.weisman@globe.com.
