IO Biotech Gets $75 Million Financing for Cancer Vaccine Development

By David Thompson

Sep 04, 2023 01:17 PM EDT

Photo by cottonbro studio(cottonbro studio from Pexels) (Credit: Getty Image)

Clinical biopharmaceutical company IO Biotech, which is leading the development of novel, immune-modulating cancer vaccines based on its T-win technology platform, recently announced it had entered into a purchase agreement for a private placement expected to result in gross proceeds of $75 million from new and existing investors including Kurma Growth Opportunities Fund, Vivo Capital, Armistice Capital, and Pivotal Life Sciences, among others. 

As part of the securities purchase agreement, the group of investors has agreed to purchase 37,065,647 shares of the company's common stock and accompanying warrants to purchase up to an aggregate of 37,065,647 shares of common stock at a combined purchase price of $2.025 per share. The warrants will be exercisable for a period of three years and six months following the date of issuance.

According to IO Biotech, it's pioneering the first dual-action immune-modulating cancer vaccine to become the "backbone of combination therapy" for people with cancer.

IO Biotech, founded in 2014, is a clinical-stage biopharmaceutical company developing novel, immune-modulating cancer vaccines based on its T-win vaccine platform, a novel approach to cancer vaccines that are designed to activate T-cells to target the most important immunosuppressive cells in the tumor microenvironment. 

More recently, IO Biotech, headquartered in Copenhagen, Denmark, with its U.S. headquarters in New York City, published its Q2 2023 financial results and announced a great deal of progress made during the first half of the year in the development of its immune-modulating cancer vaccine, IO102-IO103. Mai-Britt Zocca, Ph.D., president and CEO of IO Biotech, also announced that the company achieved its milestone of enrolling 225 patients in its pivotal Phase 3 trial for patients with advanced melanoma. 

Funding Into Q4 2025

"The continued strong support that we have received from our existing investors and the enthusiasm from an impressive group of new health care investors are testaments to the potential of IO102-IO103, to the strength of the data generated to date from the Phase 1/2 study in metastatic melanoma and from our ongoing Phase 2 basket study," said Zocca. 

With the proceeds of the financing from Armistice Capital and other investors, Zocca said that IO Biotech expects to have sufficient capital to fund its operations into the fourth quarter of 2025, "supporting the continued development of IO102-IO103 through critical clinical milestones from our pivotal Phase 3 trial in first-line advanced melanoma, as well as from our Phase 2 studies."

Latham & Watkins LLP advised the placement agents in the private placement with a New York capital markets team led by partners Nathan Ajiashvili and Alison Haggerty. 

IO Biotech's T-win Vaccines

IO Biotech credits its T-win vaccine technology with helping its scientists reimagine cancer vaccines and bring about the next frontier in immuno-oncology. 

T-win vaccines are designed to enable the killing of tumor and immune-suppressive cells in the tumor microenvironment to modulate the TME into an "anti-tumor, pro-inflammatory" environment. This proprietary and highly differentiated mechanism of action sets IO Biotech's T-win cancer vaccines apart from other approved immuno-oncology therapies that work by blocking a single immune-suppressing pathway or directing the immune system to target specific antigens.

The T-win vaccines are also designed to have broad utility and target established, well-known immune-suppressive antigens widely seen across tumor types rather than targeting rare or mutant antigens that are only expressed in a small number of patients' tumors. They're also designed to be used "off the shelf"-unlike existing cancer vaccines, which must be personalized for each patient, significantly adding to time and cost.

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