Bladder Cancer Therapies Developer Raises $380M in the First Biotech IPO of 2024

CG Oncology, a company that turns viruses into cancer therapies, has raised $380 million to […]

CG Oncology, a company that turns viruses into cancer therapies, has raised $380 million to fund clinical development of a therapy that the company believes could become a new first-line treatment for certain bladder cancers. The stock offering marks the first biotech IPO of 2024.

CG was able to raise much more than planned. In preliminary financial terms set earlier this week, the company projected selling 17 million shares in the range of $16 to $18 each, which would have raised $289 million at the pricing midpoint. When CG finalized the IPO terms late Thursday, it ended up offering 20 million shares priced at $19 apiece. Those shares will trade on the Nasdaq under the stock symbol “CGON.”

The therapies of Irvine, California-based CG are oncolytic viruses, which are viruses that infect and kill cancer cells. CG works with adenoviruses, engineering them to be more selective to cancer cells. These viruses are also designed to offer a longer-lasting effect. The engineering work includes insertion of a gene that codes for a protein that stimulates longer-term anti-tumor activity.

CG reported a cash position of $203.7 million as of the end of the third quarter of 2023. In the IPO filing, the company said it plans to spend about $183.8 million to fund R&D for cretostimogene, its only therapeutic candidate. This oncolytic virus is a potential treatment for non-muscle invasive bladder cancer (NMIBC), which is cancer found in the inner lining of the bladder.

Two Phase 3 tests are underway. One is evaluating the oncolytic virus in patients whose disease did not respond to Bacillus Calmette-Guérin (BCG), the immunotherapy that is the first-line treatment for NMIBC. These patients need additional treatment options. When cancer does not respond to BCG, the next step is a surgical procedure to remove the bladder.

In the filing, CG said it believes that cretostimogene, if approved, has the potential to serve as a first-line therapy for NMIBC. The Phase 3 test’s main goal is assessing complete response to the oncolytic virus. If this trial is successful, it could support a biologics license application submission to the FDA, the company said in the filing. Preliminary trial results are expected by the end of 2024.

The second Phase 3 test is evaluating cretostimogene as an adjuvant therapy, a treatment given to patients to keep cancer from coming back following the initial treatment. This study is testing the oncolytic virus in intermediate-risk NMIBC patients who have had tumors surgically removed. The company anticipates completing trial enrollment in 2026.

CG’s oncolytic virus may also find use as part of a combination treatment. An open-label Phase 2 study underway is testing cretostimogene alongside Keytruda, a Merck immunotherapy whose approved indications include NMIBC that is high risk and unresponsive to BCG therapy. Last year, the company reported preliminary results showing 82% of evaluable patients (27 of 33) maintained a complete response at six months and 68% (17 of 25) of evaluable patients maintained a complete response at 12 months. In the filing, CG said it expects to report more durability data in the first half of 2024.

Yet another Phase 2 test is planned to evaluate cretostimogene as a monotherapy in patients with high-risk NMIBC. This open-label study will include a cohort of patients whose disease has been exposed to BCG but is not yet categorized as unresponsive. Another group will be comprised of NMIBC patients who have not yet received BCG therapy. CG said it expects to start this study in the second half of 2024.

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