Investors seeking a new pharmaceutical play for their portfolio have a new initial public offering (IPO) to consider.
On Friday, October 20, Cargo Therapeutics, Inc. (CRGX) filed an S-1 form with the Securities and Exchange Commission (SEC). This will make it available to invest in through the stock market as it plans to list on the Nasdaq under the ticker “CRGX.”
The biotech firm hopes to raise $100 million in an IPO of its common stock. It has yet to set a date for the launch, nor has it launched terms for pricing.
The clinical-stage biopharma is developing drug candidates for treating large B cell lymphoma cancer (LBCL). Its prospectus states its strategy is to “directly address the limitations of approved chimeric antigen receptor (CAR) T-cell therapies. A CAR is a protein that has been engineered to modify T cells so they can recognize and destroy cancer cells.”
J.P. Morgan, Jefferies, TD Cowen, and Truist Securities are listed as the joint underwriters for the deal.
Cargo is an early-stage pharma company spending capital on clinical trials and so has yet to become profitable. The company clocked a net loss of $56.63 million in the 12 months up to June 30, 2023.
Coming in Hot
Cargo has had a big year. In March, it raised $200 million in a Series A financing round. By August, it had deployed that cash to stage a phase 2 large B-cell lymphoma trial for its autologous CD22 CAR-T therapy.
According to its prospectus, Cargo plans to funnel the upcoming IPO proceeds to continue its phase 2 trial (an interim readout of results is expected in 2025). It will also use funds to accelerate internal research and development and to potentially finance licensing or acquisitions of complementary assets or intellectual property.
This year, Cargo President and CEO Gina Chapman has also been busy poaching top industry talent to join its C-suite ranks. This includes Chief Scientific Michael Ports, Ph.D., who previously headed Janssen’s cell therapy discovery and platforms. The latest recruit – Genentech alum Ginna Laport, M.D., – was appointed chief medical officer just last week.
Room for Growth
The market opportunity for treating LBCL is quite large and likely to grow further.
According to a 2022 market research report by Data Intelligence, the market for treatments of diffuse large B-cell lymphoma was an estimated $4.1 billion in 2021 and is forecasted to reach $7.9 billion by 2030, representing a compound annual growth rate (CAGR) of 7.50% over through to the end of the decade.
Yet several competitors are developing analogous treatments, including AbbVie, Amgen, AstraZeneca, Bristol-Myers Squibb, Genmab Incyte, Janssen, Merck, Regeneron, Roche, and others.
While the broader IPO market in 2023 has stirred slightly from last year’s deep coma, biotech remains lying motionless. In the first half of this year, only nine biotech companies went public, making it the slowest six months for biotech IPOs in at least six years, per BioPharma Dive data.
Wall Street will watch to see if Cargo can inject new life into the biotech cadaver as a peculiar trading year nears its close.
Interested investors will want to keep abreast of coming updates regarding Cargo’s pricing and launch date over the coming weeks.