The cell therapy-focused biotech will use most of the net proceeds from its initial public offering to fund Phase II clinical trials for its lead program, a novel CAR T-cell candidate.
Pictured: IPO concept art showing stacks of coins and an upward trendline/iStock, holwichaikawee
Biotech initial public offerings are the exception rather than the norm in 2023, but Cargo Therapeutics is looking to brave the current financial waters and launch an IPO, according to a document filed on Monday with the Securities and Exchange Commission.
The California-based biotech plans to offer over 41 million shares, provided its underwriters exercise their full option to buy additional shares. The SEC filing assumes that shares will sell at $16.00 per share and Cargo seeks to net over $315 million if the underwriters purchase the total number of shares.
Cargo’s shares will trade on the Nasdaq using the ticker symbol CRGX.
The company plans to use around $220 million of the net proceeds from the IPO to fund Phase II trials of its lead candidate CRG-022, which is an autologous CD22 CAR-T cell therapy treatment designed for patients with large B-cell lymphoma that have been relapsed or were refractory. Another $20 million will go towards R&D efforts, while Cargo will use the leftover cash for working capital and other general corporate purposes.
“We may also use a portion of the net proceeds to in-license, acquire or invest in complementary technologies, assets, or intellectual property. We regularly evaluate strategic opportunities; however, we have no current commitments to enter into license arrangements or acquisition agreements or to make any such investments,” the SEC filing said.
The IPO is meant to provide the company with enough cash to last through 2025. Cargo did not respond to BioSpace for additional information on the offering.
Cargo’s other candidates in its pipeline include the development of “multi-specific” CAR T-cell therapies targeted against B-cell malignancies. However, these candidates currently remain in the IND-enabling stage, according to Cargo’s website.
The biotech received a significant cash injection in March 2023, closing a $200 million Series A round co-led by Third Rock Ventures, Perceptive Xontogeny Venture Fund and RTW Investments, LP.
“Our recent accomplishments and this new funding enable us to build a truly differentiated platform to advance the cell therapy field meaningfully. We are extremely pleased to have the support of seasoned new and current investors who share our vision of developing the next generation of best-in-class CARs that have the potential to extend life for many more patients,” Cargo CEO Gina Chapman said in a statement at the time.
Meanwhile, on the IPO front, things have been relatively quiet in 2023 except for a few biotechs. Lexeo Therapeutics, which is developing an Alzheimer’s treatment, announced on Friday that it plans to sell more than nine million shares of stock to raise over $100 million.
Tyler Patchen is a staff writer at BioSpace. You can reach him at tyler.patchen@biospace.com. Follow him on LinkedIn.
