Days after Merck deal, Sutro rolls out $85M E round to fund internal cancer pipeline

Just days after announcing a deal with Merck, South San Francisco’s Sutro BioPharma is trotting out a sizable infusion of cash today to fuel its own internal pipeline of cancer drugs.

The company says it’s raised $85.4 million from a rather lengthy list of investors to push two early-stage programs through the clinic. Sutro, though, is probably better known for its manufacturing tech, which allows them to produce therapeutic proteins without using live cells as miniature factories. That’s particularly useful for speeding up discovery and development.

Merck just expressed some interest in Sutro’s tech earlier this week, when it inked a $60 million discovery deal with the company. The duo will be looking for immunomodulatory drugs that can work on cancer or autoimmune diseases.

It’s not the first time Sutro has partnered on Big Pharma research, but they also have their own antibody projects in the pipeline. The company’s lead program is STRO-001 — in Phase I trials for lymphoma and multiple myleloma. And they have a preclinical drug, STRO-002, which they’re planning to push into human trials in early 2019. That one’s targeting ovarian and endometrial cancer.

Trevor Hallam

Sutro’s chief scientific officer Trevor Hallam says the company’s platform tech should help them develop more reliable, efficacious drugs.

“Earlier generations of ADCs can have unpredictable pharmacologic properties, resulting in the potential for sub-optimal stability, compromised efficacy and poor tolerability for patients,” he said.

Sutro’s platform allows them to incorporate non-natural amino acids into specific spots on the antibody for site-specific conjugation of cytotoxins, “with a linker and warehead to enable consistent, stable, pinpoint placement of STRO-001’s toxic payload.” This, Hallam says, leads to highly efficient delivery of the cytotoxin to tumor cells.

William Newell

This latest financing was led by Samsara BioCapital, a new fund based in Palo Alto, and Surveyor Capital (a Citadel company). The round was supported by several existing investors, including Alta Partners, Amgen Ventures, Celgene Corporation, Lilly Ventures, Skyline Ventures and SV Health Investors, among others.

“With this latest round of funding, Sutro has raised over $175 million since its founding in 2003 — a vote of confidence in our work on a new generation of novel, targeted therapies with the potential for improved therapeutic profiles,” Sutro CEO Bill Newell said.

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