Tight-lipped no more, Erasca nabs $300M IPO to attack cancer's favorite pathway

Months after finally revealing its first weapons against cancer, Erasca has pulled off a $300 million IPO. The proceeds will propel an SHP2 inhibitor and an ERK inhibitor through the clinic and get at least one more prospect into human trials. 

Like many of its peers, the San Diego-based biotech filed to raise up to $100 million in an IPO last month, amending that to as much as $280 million on Monday, according to a securities filing. Erasca eventually snagged $300 million by offering 1.25 million, or 7%, more shares than originally planned. 

The company is developing treatments for cancers driven by the RAS/MAPK pathway, one of the most commonly mutated pathways in cancer. Its pipeline is divided into three broad buckets: treatments that target RAS itself; treatments that target proteins upstream or downstream of RAS, such as SHP2 and ERK; and treatments that target escape routes used by RAS-driven cancers to evade drugs and develop resistance. 

RELATED: Erasca picks up $42M to target biological drivers of cancer 

Erasca earmarked $90 million to $100 million for ERAS-007, an ERK inhibitor it licensed from Asana BioSciences, according to the securities filing. The cash will support multiple phase 1b/2 studies for the drug, including in blood cancers, non-small cell lung cancer, colorectal cancer and other solid tumors. The company expects the funds to get the drug through at least one clinical data readout. 

The company will use $45 million to $50 million to get ERAS-601, a SHP2 inhibitor licensed from NiKang Therapeutics, through a phase 1 data readout. Another $75 million to $90 million will bankroll discovery and development for its other programs targeting the RAS/MAPK pathway, including programs targeting EGFR and multiple types of KRAS mutations. With the IPO proceeds, it plans to get at least one of these prospects into the clinic. 

Erasca, literally “erase cancer,” emerged in December 2018 with $42 million and a lofty but vague mission to “not just treat, but actually cure cancer.” At the time, the company said it was working on “multiple discovery programs” that target biological drivers of cancer but kept details under wraps. 

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The tight-lipped biotech had no trouble raising money—it closed a $200 million series B round in April 2020, extending that to $236 million four months later, all without divulging specifics.

Erasca finally pulled back the curtain on its strategy ahead of this year’s virtual J.P. Morgan healthcare conference, announcing that it had picked up the worldwide rights to ERAS-601 and all other SHP2 inhibitors developed by NiKang and to ERAS-007 and all other ERK inhibitors developed by Asana.