This article originally appeared via NCBiotech’s blog.
Shattuck Labs, a biotechnology company with operations in Durham, stands to raise up to $103 million in a private placement financing.
The company will use some of the proceeds for clinical development of its lead therapeutic candidate, an antibody dubbed SL-325, for the treatment of Crohn’s disease, ulcerative colitis and other autoimmune and inflammatory diseases.
“Enrollment in our Phase 1 clinical trial for SL-325 is expected to begin this quarter, subject to regulatory alignment, and this financing will allow us to transition seamlessly into multiple Phase 2 clinical trials,” Taylor Schreiber, M.D., Ph.D., chief executive officer of Shattuck, said in a news release.
The trials should reveal whether SL-325’s ability to block Death Receptor 3 (DR3) in the DR3/TL1A disease pathway leads to both superior efficacy and reduced immunogenicity in comparison to TL1A-blocking antibodies. SL-325 is designed to achieve a complete and more durable blockade of the pathway, which causes inflammation in inflammatory bowel disease.
“Shattuck’s preclinical studies demonstrate high affinity binding and superior activity over TL1A antibodies, and offer a data-driven rationale for targeting the TNF receptor, DR3, versus its ligand, TL1A,” Schreiber said.
The company is using its protein engineering expertise to develop novel therapeutics targeting tumor necrosis factor (TNF) superfamily receptors for the treatment of patients with inflammatory and immune-related diseases.
New and existing investors participate
The private placement was led by OrbiMed and with participation from both new and existing investors, including Coastlands Capital, Prosight Capital, Adage Capital, Redmile Group, NextBio Capital, and an investor that Shattuck described as “a large healthcare-dedicated fund.”
Shattuck anticipates the initial gross proceeds from purchases of its common stock to be about $46 million, with up to $57 million more if accompanying pre-funded warrants are fully exercised.
The private placement funding, combined with current cash and cash equivalents, is expected to sustain company operations into 2029. As of March 31, the company had cash and cash equivalents of about $60.9 million, enough to fund operations into 2027, according to the company’s first-quarter report.
The closing of the private placement is contingent upon Investigational New Drug Application (IND) clearance for SL-325 by the U.S. Food and Drug Administration and the satisfaction of other customary closing conditions. Shattuck intends to file an IND application in the third quarter of this year.
Shattuck is headquartered in Austin, Texas. Its stock is traded on the NASDAQ market under the symbol STTK.
The company raised $202 million in its initial public offering in 2020. Before the IPO, Durham-based Hatteras Venture Partners was among the investors in Shattuck’s Series B financing, which raised $118 million.
