Even before it gets approval for its sleep apnea pill, Apnimed is testing investor appetite.

The Cambridge, Mass.-based biotech priced its shares at $16 to raise $192 million in an upsized IPO that would value the company at more than $600 million. The company’s stock is set to begin trading on Friday on Nasdaq.

“It’s been a one-size, fits-all disease, treated with a one-size, fits-all machine,” CEO Kevin Lind, 50, tells Forbes. “There is a better way.”

Lind took over as CEO from cofounder Larry Miller, a pulmonary doctor and serial entrepreneur who had postponed his own retirement to launch the company, in June. Lind, the company’s former board chairman, had previously cofounded Longboard Pharmaceuticals, which developed an epilepsy drug and was acquired by Denmark’s Lundbeck for $2.6 billion in 2024. Miller, 73, remains on the board as vice chairman.

Forbes ____profiled the company and its efforts to develop a drug for sleep apnea, a condition that affects as many as 80 million people in the U.S. alone, earlier this year.

Researchers have been trying without success for decades to develop a drug that could fix sleep apnea, a common condition in which breathing pauses during sleep, sometimes lowering oxygen levels to a dangerous degree. Today, the primary treatment for the disease is a continuous positive airway pressure machine, known as a CPAP, which forces air down the wearer’s throat to keep it open. The device works, but no surprise, it’s hated by most everyone who has to use it. Many people with sleep apnea refuse to try it or won’t even get diagnosed for fear they may have to.

Lind says that only 23 million people – a minority of those with the disease – have been officially diagnosed, and of those 10.5 million remain untreated. “This gives us a tremendous opportunity to grow the market,” he says. “The easiest place for us to start is with the 10.5 million who are diagnosed and have chosen not to be treated.”

Research shows that people with untreated sleep apnea are more likely to develop heart trouble, strokes and perhaps even Parkinson’s and Alzheimer’s. A treatment that’s easier for patients to bear could have a transformative impact on their overall health.

That’s why when Harvard researcher Dr. Luigi Taranto Monetemurro, now Apnimed’s chief scientific officer, was testing a potential apnea medication back in November 2016, he was shocked to discover it was helping his subject breathe normally. Apnimed launched in 2017 after acquiring rights to that potential therapy.

The company raised some $260 million from investors that include Morningside Group, Alpha Wave Global and Sectoral Asset Management at a valuation of around $400 million. Its early believers stand to make a bundle on the IPO.

“The easiest place for us to start is with the 10.5 million who are diagnosed and have chosen not to be treated.”

Until recently, sleep medicine had been something of a backwater, but that may be changing. At the end of 2024, the FDA approved Eli Lilly’s weight-loss drug Zepbound for the treatment of moderate-to-severe sleep apnea in adults who are obese. Unlike Apnimed’s pill, Zepbound does not treat sleep apnea directly, but works indirectly because people who are overweight are more likely to suffer from it. “People tend to believe that OSA [sleep apnea] is associated with obesity, but over 60% of the patients with it are not obese,” Lind says.

Last year, Apnimed reported a $58 million net loss from continuing operations on revenue of just $38 million, according to its prospectus. In March, the company sold its 50% stake in a joint venture with Japanese biotech Shionogi related to another potential sleep apnea therapy to that firm for $100 million upfront, plus a $50 million milestone payment, and royalties, in order to focus on its own pill.

The big question now is the commercial trajectory for Apnimed’s first sleep apnea drug, a once-nightly pill. The company submitted the medication to the FDA for approval and could receive the okay in the first quarter of 2027. Lind says Apnimed has not yet set the price for the pill, but has begun preparations for its commercial launch. Even if a small percentage of people with sleep apnea were to take its pill, the drug would likely become a blockbuster. “The numbers are staggering,” Miller told Forbes last winter.

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