Like many a biotech company in 2021, Candel Therapeutics filed to raise up to $100 million in its IPO. But unlike several of its peers, which outraised that initial figure by two- or even threefold, the oncolytic virus player downsized its deal, eventually reeling in $72 million.
Three weeks after its initial filing, Candel revealed a new goal of $85 million, to be achieved by offering 6.1 million shares at a price range between $13 and $15 a piece, according to a securities filing. On Monday, the company cut the target further, to $72 million, by offering nearly 3 million more shares, but at the lower price of $8 apiece, according to a securities filing.
It expects the proceeds, along with the cash it already has in the bank, to last it through the first quarter of 2023, it said the filing.
Part of the proceeds will bankroll a pair of phase 3 trials for its lead oncolytic virus, known as CAN-2409 or aglatimagene besadenovec. About $2.7 million will fund patient enrollment in a brain cancer trial and about $3.7 million will support a phase 3 study in patients with newly diagnosed prostate cancer who are at intermediate or high risk of their disease progressing, the company said in the filing.
Candel hopes to start the brain cancer study in the first half of 2022 and finish enrolling the prostate cancer trial in the third quarter of this year.
Another $8.3 million will support the development of CAN-2409 and another asset, CAN-3110, in other clinical trials, including in lung cancer and pancreatic cancer.
The company earmarked about $15.6 million to build up its manufacturing capabilities, both in-house and with third-party organizations. This includes the development, construction and qualification of its own facility and the development of capabilities with contract manufacturers, the company said in the filing.
Candel’s oncolytic virus treatments are designed to “light up” and destroy tumors while triggering a long-term systemic immune response to keep cancer in remission. CAN-2409 is based on its adenovirus program, while CAN-3110 uses its herpes simplex virus (HSV) platform.
CAN-2409 uses a cold virus that’s genetically modified to not replicate to deliver a herpes simplex virus-derived gene to the tumor. The patient then takes an oral prodrug, such as the antiviral valacyclovir. Together, the treatments trigger tumor cell death—making the tumor release neoantigens—and stimulate the production of inflammation-promoting cytokines in the tumor microenvironment. Then, the T cells come in, recognizing the neoantigens and killing the tumor.
Though the company has two main approaches, it has started new discovery work that could lead to the addition of more virus platforms to its portfolio.
“It’s probably fair to say we will develop more than two oncolytic viruses. There are different needs in different kinds of tumors,” Candel CEO Paul-Peter Tak, M.D., Ph.D., said in a previous interview.