IPOs

Neoantigen pioneer Neon Therapeutics casts off in search of $115M IPO to fuel the race to a personalized cancer treatment

Can a bespoke cancer vaccine actually succeed in treating individual oncology cases? 

Eric Lander

Neon Therapeutics launched three years ago, setting out on a mission to prove that it could, and it now has enough examples of a select handful of individual responses to their neoantigen platform to gamble that investors will come in to back a $115 million IPO as they look to transition from their first exploratory human studies into advanced development work.

Over the startup period, Neon has been developing its first peptide-based individualized cancer vaccines, working with the mutations present in each case. Their work has steered them toward a set of cancers like non-small cell lung cancer, which have a high mutation burden and a rich set of individual antigen targets to select from.

By zeroing in on these neoantigens, they say, they can make the first generation of checkpoint inhibitors — designed to unleash a swarm of T cells on cancer cells — far more effective. But groundbreaking new technologies like these also require their own manufacturing base, and they won’t come cheap.

Catherine Wu, Neon Therapeutics

Third Rock launched Neon Therapeutics with a high council of prominent scientists from Dana-Farber, MIT and elsewhere. The advisory group included Eric Lander from the Broad Institute of MIT and Harvard, MD Anderson’s Jim Allison and Catherine Wu with Dana-Farber. In true Third Rock style they recruited Novartis vet Hugh O’Dowd to come in and take the helm, and the VC group still owns 44.4% of the equity.

Access Industries weighs in at 12% with Fidelity at 7.5% and Partner Fund Management at 7%. O’Dowd has a 2.6% slice.

Neon has burned through $111 million to get to this stage, and the team has $62 million in reserve. A success here would extend their runway considerably, if they can get enough support for what remains a high-risk effort to break serious new ground in oncology.

Not at all unsurprisingly in an era of rampant I/O enthusiasm, Neon is also busy in a field crowded with would-be pioneers. The most prominent group includes Aduro Biotech, Advaxis, Agenus, BioNTech AG, Gritstone Oncology, Moderna Therapeutics, PACT Pharma, and Ziopharm.

Neon plans to trade as $NTGN.


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