Imugene raising $65 million to fund global growth, acquire Azer-cel

Sydney-headquartered Imugene (ASX: IMU) has made a strong start to a $65 million capital raising aimed at supporting its global growth plans.

The transformative cancer medicine developer has received firm commitments for the first phase of its strategic funding plans, with institutional and sophisticated investors jumping in to grab a share of a $35 million placement.

The placement involved an uptake of approximately 416.7m new Imugene fully paid ordinary shares at a price of $0.084 per share.

The company has confirmed that the placement attracted considerable interest and support from specialist biotech institutional investors, as well as a number of the company’s directors and key management personnel who have committed approximately $840,000.

$30m SPP unveiled

For the second stage of its significant capital raising exercise, Imugene has revealed it will be conducting a $30 million share purchase plan (SPP), which is being offered to existing eligible shareholders at the lower of $0.084 and a 2.5% discount to the 5-day VWAP up to and including the closing date of the SPP.

Imugene founder and executive chairman Paul Hopper said there had been very strong support from institutional interest coming from Australia, Asia in particular, and the US.

“It was very important to the board that our loyal individual shareholders be offered the opportunity to also participate via the SPP, and we are glad to say that their voice has been heard.”

New global licence acquired

The cap raising news comes a day after Imugene inked an agreement with US-based Precision Biosciences to acquire a global exclusive license to Precision’s Azer-cel allogeneic CD19 CAR T cell therapy program.

According to Imugene managing director and chief executive officer, Leslie Chong, Azer-cel contains one of the most extensive clinical data sets for a CD19 directed allogeneic cell therapy.

The strategic acquisition will allow Imugene to add Azer-cel to its own pipeline of developments, particularly the company’s onCARlytics program, creating the foundation for a novel and broadened approach to cell therapy.

“CD19 is a well validated clinical target in blood cancers. OnCARlytics can enhance the expression of CD19 on solid tumours. Azer-cel is a supercharged allogeneic T cell designed to identify and kill malignant cells expressing CD19. We are thrilled about the potential benefit for patients from the combination of these two technologies,” Ms Chong said.

Under the licence agreement, Imugene has acquired the exclusive world-wide rights to develop and commercialise the Azer-cel technology in oncology.

Licence acquisition background

Imugene will pay for the Precision Biosciences licence acquisition via a number of stages, leading off with a cash payment of approximately $12.49 million and a deferred consideration of around $20.2 million on closing.

A further payment of $12.59 million will be required on satisfactory completion of the imminent Phase 1b clinical trial.

A payment of approximately $309 million will also need to be made, related to performance-based payments over the development life of Azer-cel linked to the achievement of certain value-inflection development milestones, including approval in multiple indications and sales in US and EU.

Imugene will also acquire the lease to a 32,800 square foot GMP manufacturing facility in North Carolina, drug material for completion of a Phase 1b clinical trial and an experienced cell therapy and manufacturing team of approximately 50 personnel.

Funding plans revealed

Ms Chong said a significant portion of the new funds will now be used to cover costs associated with the Precision Biosciences licence acquisition.

“We appreciate the strong support and belief from new and existing investors in our company’s vision. This raise places Imugene in an enviable position with regards to its balance sheet with the financial horsepower to execute across all our platforms.”

“I thank all our investors for the confidence they have shown in our company,” she said.

Bell Potter Securities is acting as lead manager for the capital raising.