Magenta Therapeutics Sets Sights on $100 Million IPO To Advance Bone Marrow Transplant Programs

IPO

Weeks after securing $52 million in a Series C financing, Magenta Therapeutics is eying the raising of $100 million in an initial public offering two years after it was launched by Third Rock Ventures and Atlas Venture with $48.5 million in Series A financing.

Cambridge, Mass.-based Magenta said it intends to use the funds from the IPO to advance its portfolio of bone marrow transplant medications. Bone marrow transplant is often used to treat certain types of blood cancers and genetic diseases. Magenta’s approach to address some of the issues with traditional marrow transplants is to use antibodies that recognize stem cells linked to drugs that can then selectively remove stem cells and diseased cells. The approach by Magenta is believed to have fewer side effects and toxicity.

In its S-1 filing with the U.S. Securities and Exchange Commission, the company said it intends to use the funding to specifically advance the development of two clinical assets, MGTA-456 and MGTA-145. With the finances gained from going public, Magenta said it would be able to support the development programs with investments in manufacturing and potential commercialization. Magenta said it will also use some of the money to initiate asset studies in other indications, such as sickle cell disease and blood cancers.

The Phase II MGTA-456 is the company’s most advanced asset. Magenta in-licensed MGTA-456 last year from Novartis. MGTA- 456 is a first-in-class allogeneic stem cell therapy consisting of a single umbilical cord blood unit expanded with an aryl hydrocarbon receptor (AHR) antagonist. Magenta believes MGTA-456 has the potential to treat patients with higher cell doses than otherwise possible and to have access to better HLA-matched cord blood units. In April the company dosed the first patient in the Phase II MGTA-456 trial. The patient has an undisclosed inherited metabolic disorder, the company said at the time.

Magenta’s MGTA-145 is being developed in order to help physicians have an easier time in harvesting a greater number of blood stem cells, which are known as hematopoietic stem cells or HSCs, from patients and donors to improve patient outcomes.

While Magenta said in its filing that it’s primarily focused on advancing its internal assets, the company noted that it could use some of the proceeds from the IPO to “in-license, acquire or invest in new businesses, technology or assets.” Magenta said it has no deals on the table but does “evaluate such opportunities” periodically.

Funds from an IPO will also likely be used to advance assets in its developmental deal with Germany’s Heidelberg Pharma GmbH. In March the two companies forged a multi-target research deal to improve curative bone marrow transplantation. Under terms of that deal, the companies will use Magenta’s stem cell platform and proprietary antibodies with Heidelberg’s proprietary ATAC (Antibody Targeted Amanitin Conjugates) platform to focus on up to four targets.

As Magenta looks to the IPO, the company closed out the first quarter with $41.5 million. The April financing round of $52.3 million gives the company just under $95 million in available cash.

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