Zenas BioPharma has bagged a $200 million series C, extending its cash runway another 18 months through a raft of key readouts for its lead monoclonal antibody obexelimab.
The new financing—Zenas’ second consecutive nine-digit haul—was led by SR One, New Enterprise Associates, Norwest Venture Partners and Delos Capital, according to Tuesday’s release. The primary use of the capital will be to advance mid- to late-stage trials of obexelimab, a monoclonal antibody being developed to treat a range of autoimmune diseases.
Lonnie Moulder, Zenas’ founder and CEO, said the decision to stay private was due in part to a tepid IPO scene when fundraising began.
“If you look at the public markets, and where they were just a number of months ago, I think people would say it was a challenging situation in our sector for potential IPOs,” he told Fierce Biotech in an interview. Despite a flurry of public offerings in January, the pace of new public entrants in 2024 remains sluggish overall.
The money will help pay for further clinical development of obexelimab, a dual-acting antibody targeting CD19 and FcγRIIb that Zenas acquired from Xencor. The therapy has four phase 2 or phase 3 readouts expected before 2026. Atop the to-do list is a phase 3 study in patients with IgG4-related diseases, with data expected at the end of 2025.
The candidate was a high priority for Xencor until a failure in lupus in 2018 prompted it to pull plans to run a phase 3 trial in another indication and seek a partner. More than three years after the lupus flop, Zenas acquired the asset in return for equity and milestones.
Bristol Myers Squibb has also shown an interest in the candidate, handing over $50 million upfront to Zenas in September 2023 for certain rights in Asia.
Zenas is preparing to launch two phase 2 trials this summer for patients with multiple sclerosis (MS) and systemic lupus erythematosus, respectively. Moulder said both studies are expected to read out before the IgG4-related diseases study, with the MS trial up first.
“This capital provides runway for the conclusion on those two trials in advance of the phase 3 readout,” Moulder said. “That's how we thought about it, and that's why we ended up upsizing to a full $200 million on this round.” The company’s fourth indication, warm autoimmune hemolytic anemia, should have a phase 2 readout before the end of the year, the CEO added.
Two earlier-stages assets, an anti-TNFα therapy called ZB002 and an TLA4-Ig fusion protein dubbed ZB004, are up for collaboration and partnerships, explained Moulder, who also co-founded cancer-focused biotech Tesaro, which was acquired by GSK.
MS and lupus have been hotbeds of biotech interest among cell therapy companies that have pivoted their technologies from oncology to autoimmune conditions. Moulder believes that because obexelimab inhibits rather than depletes B cells, the asset could be better tolerated than other therapies.
Zenas described itself as a “cross-border” company when it launched in 2021 with a footing in China and the U.S. One of the backers was the venture arm of WuXi Biologics, which has come under scrutiny after being named in the BIOSECURE Act introduced in the U.S. House of Representatives in January. Moulder now describes Zenas as a “global company” that has since evolved, with a strong footing in the Boston area.
“It’s an evolution that’s not obvious because we're not a public company,” he said.