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Aligned With Roche, SQZ Bio Gets $16M to Push Cell Therapies to Clinic

Xconomy Boston — 

The first experimental cell-based cancer immunotherapy, known as CAR-T, could soon be submitted to the FDA for approval. But CAR-T therapies have limitations. One of many companies looking to improve them is tiny Boston startup SQZ Biotech, and it just pulled in more cash.

The $16 million Series B round SQZ is announcing this morning led by NanoDimension and Polaris Partners will help fund what’s becoming a broad effort to make cell-based cancer treatments, both on its own and through its partnership with Roche, announced last year. In addition to the new funding, SQZ has hired Kris Elverum, a former executive with the cell therapy division Novartis recently disbanded, as its chief business officer.

SQZ’s founders invented a microchip that gently squeezes cells without killing them, just enough to open their membranes and let proteins in. SQZ thinks it’s a way to arm cells to help kill cancer, and perhaps to treat autoimmune and infectious diseases, too, according to CEO Armon Sharei.

Cancer is SQZ’s starting point, however. So far, experimental CAR-T treatments—in which patients’ T cells are modified and turned into better cancer killers—have produced impressive results in patients with certain blood cancers, and Kite Pharma (NASDAQ: KITE), Juno Therapeutics (NASDAQ: JUNO), and Novartis have been vying to be the first to ask the FDA for approval.

French firm Cellectis (NASDAQ: CLLS) is advancing an “off-the-shelf” form of the treatment that has also shown some early promise. And Celgene (NASDAQ: CELG) and Bluebird Bio (NASDAQ: BLUE) have been working on a cell therapy for a different blood-borne cancer, multiple myeloma.

Currently, Kite is in the lead with data released this week. Though Novartis still plans to advance its lead CAR-T product, CTL-019, the shakeup at its cell therapy division leaves the status of its efforts unclear.

Three patients in a trial of Juno’s most advanced CAR-T treatment died, leading to a several-day FDA halt of the study and a delay of the drug.

It’s unclear how long the first wave of CAR-T therapies will remain effective in patients whose cancers have almost miraculously disappeared. Cancers have many ways to develop resistance and return.

It’s also unclear whether CAR-T can be effective for more common solid tumors, such as breast, lung, and colon cancer, and whether they can be manufactured cost-effectively. These treatments can also work so well they trigger an overdrive of the immune system known as “cytokine release syndrome,” which has led to deaths in several CAR-T studies.

These limitations leave an opening for SQZ and others. SQZ CEO Sharei says its cell-stuffing technology can work with many different types of cells, but unlike most cell-based immunotherapy methods, SQZ’s isn’t being used to modify T cells directly. It is already working with Roche to alter another type of immune cell, B cells, that would in turn super-charge T cells to go after cancer. (Here’s more on the concept, and the Roche deal, from last December.)

SQZ’s B cell-targeting method is untested in humans, but if it works, it might have some advantages to current CAR-T treatments, which can take weeks to produce and wipe out healthy B cells along with the cancerous ones. Sharei says SQZ’s treatments should spare healthy cells and could be produced much faster than CAR-T therapies. They are still in preclinical testing. Sharei declines to say when they might reach clinical trials.

Sharei is mum about the types of cancer the company wants to go after first, and if SQZ is looking to “squeeze” other cells beyond B cells, he isn’t saying which ones they are specifically. But Sharei says the company’s other work will stick to the same general plan: Break off the important bits of a tumor that provoke the immune system, and stuff those bits (called “antigens”) into cells, like B cells, whose job is to present the antigens to T cells and prime them to attack. Those stuffed cells would then go back into the patient and help his or her immune system fight the cancer.

Using a similar method with bits of a virus or bacteria might open SQZ’s work up to infectious diseases. It’s exploring the idea of manipulating certain cells to treat autoimmune diseases too.

“There’s just so many things this [technology] can do,” Sharei says. “We don’t know how it’s going to play out.”