CAR-T cell therapy startup Arsenal Biosciences has reeled in a $325 million Series C as it works through two early-stage trials in solid tumors.
But even after securing the fifth-largest private biotech financing round so far in 2024, ArsenalBio is also prioritizing, joining the likes of many other well-funded startups in the industry. The lead program, AB-1015, is not expected to move beyond a Phase 1 in ovarian cancer.
“[AB-1015] was the first program that we put into the clinic, and it gave us incredible insight into the novelty of our product design that we could then evolve into the second- and third-generation programs,” CEO Ken Drazan said in an interview with Endpoints News.
The Series C came about two years after ArsenalBio’s last major raise of $220 million.
With the new megaround, which Drazan said is not tranched, ArsenalBio will focus on its second clinical-stage autologous cell therapy, dubbed AB-2100. The programmable cell therapy entered the clinic earlier this year for kidney cancers, and the startup expects to have a clinical progress update by year’s end, the CEO said.
The biotech also plans to bring a third cell therapy into the clinic, in prostate cancer, in late 2025 or early 2026.
ArsenalBio manufactures its cell therapies in-house and uses synthetic biology, computation and other technologies to genetically adjust a patient’s own T cells to thwart solid tumors. Cell therapies have dramatically changed the treatment landscape for blood cancers, but the move into solid tumors has been fraught with more challenges.
‘More news’ by year’s end
The latest round included a cohort of first-time ArsenalBio backers, including ARCH Venture Partners, Milky Way Investments Group (also behind cell therapy developers Lyell and CERo), newly-launched Regeneron Ventures, Nvidia’s VC arm, T. Rowe Price and Rock Springs Capital. Existing investors also took part in the new round, including partner Bristol Myers Squibb, Westlake Village BioPartners, SoftBank Vision Fund 2, the Parker Institute for Cancer Immunotherapy and others.
Drazan said the round’s “diversity of investors” includes a few buckets: traditional specialists, firms that typically come in for crossovers or IPOs, and strategics with specific interests.
“I would just encourage you to look at that list of individual corporations, and you can probably see that some are interested in medicines and some that are interested in other things,” Drazan said, “and those other things, we hope to have more news about before the end of the year.”
Drazan was previously president of Grail before co-founding ArsenalBio in January 2019. His leadership team includes experienced cell therapy developers and manufacturers, including CMO Susie Jun, who was the chief development officer at Allogene; and technical operations chief Tim Sirichoke, who’s been at Kite Pharma, Novartis and Genentech.
The biotech has expanded to 265 employees across locations in South San Francisco and Hayward, CA. It’s also working on two solid tumor CAR-T cell therapies with Bristol Myers and research in undisclosed areas with Genentech, which is pulling back in certain cancer immunology areas.
Multiple large pharmaceutical companies and nimbler biotechs are also moving cell therapies into the autoimmune field. While ArsenalBio doesn’t plan to develop autoimmune cell therapies internally, its technology platform could “enable autoimmune drug developers, and we’re hoping to provide that capability through business development,” Drazan said.
“Hopefully, we’ll have some news on that front later this year,” the CEO added.