Zentalis uncloaks with $85M to push solid tumor programs into pivotal trials

In a time where biotech companies are banking multimillion-dollar IPOs at earlier and earlier stages, Zentalis Pharma stayed under the radar for an unusually long time. Now, five years after its founding, the company is coming out of the shadows with an $85 million series C, which will propel its lead programs into pivotal trials.

The long wait, Zentalis CEO Anthony Sun, M.D., a longtime venture capitalist, told FierceBiotech, was deliberate: "From my background as a partner at Aisling Capital, I've seen a lot of companies go public or come out of stealth, I think, prematurely, when it's basically a science project," he said.

"This is not really an early-stage company. It's probably a midstage company and we wanted to show people that this is real," he said. "We have three programs in the clinic in the span of five years that we built in our own labs... I wanted the team—including myself—to focus on execution."

The latest round, drawn from Matrix Capital, Viking Global Investors, Redmile Group, Farallon Capital, Perceptive Advisors, Citadel’s Surveyor Capital and Eventide Asset Management, brings its total raised to $147 million. In addition to funding pivotal trials, the company will use the capital to “broaden the scope” of its clinical programs, the company said in a statement. 

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Zentalis is developing ZN-c5, a selective estrogen receptor degrader, for the treatment of ER-positive, HER2-negative breast cancer. It inked a clinical development deal with Pfizer in May 2018 to test the drug alongside Pfizer’s CDK4/6 inhibitor Ibrance (palbociclib). It expects to report data from a phase 1/2 study of ZN-c5 in combination with Ibrance, as well as a single agent, in 2020.

Its clinical pipeline also includes ZN-c3, which targets the WEE1 kinase to treat solid tumors, and an EGFR med for lung cancer. It plans to move its fourth program, drug targeting BCL-2 in blood cancers, into the clinic by the middle of 2020, Sun said. The preclinical pipeline comprises a pair of programs in blood cancers and solid tumors.

“In my career, I have never seen a company progress at this pace with three INDs accepted in the first five years since inception. I am very proud of our team for these remarkable accomplishments. This financing reflects strong support for our capabilities, people and pipeline,” Sun said in the statement. “The investment positions us to implement our clinical and partnering strategies around our current pipeline and to accelerate expansion of our team.”

The company has outgrown its science center and will probably get close to 100 employees next year, Sun said. It plans to push its programs into "more mature stages," expand the pipeline and, Sun hopes, start exploring how its different compounds might be able to work together.

Editor's note: This story was updated with comments from Zentalis CEO Anthony Sun.