The deal marks an end for CAR T company Cargo Therapeutics, which has been slashing its workforce and cutting programs since the January decision to halt its lead candidate for a certain type of aggressive large B cell lymphoma.
CAR T cell therapy biotech Cargo Therapeutics is the latest company to accept an offer from Concentra Biosciences, the shell company that has been on an acquisition tear this year.
Cargo will fold into Concentra for about $202 million upfront, with further cash available via a contingent value right later on that could add another boost of cash. The complex back-ended deal provides Cargo shareholders with 100% of the net cash above $217.5 million at closing plus 80% of any net proceeds within two years as Cargo’s assets are sold off.
The deal marks an end for Cargo, which has been shaving down its workforce since the January decision to halt a mid-stage trail for lead candidate firicabtagene autoleucel (firi-cel). The decision was made after the company determined that the benefit-risk profile did not support continued development of the autologous CD22 CAR T cell therapy in patients with a certain type of aggressive large B cell lymphoma (LBCL).
Firi-cel achieved a 77% response rate and complete response of 43% in the Phase II trial but durability was just 18% at three months, meaning patients relapsed quickly. The results were lower than what the therapy managed in an earlier Phase I study.
Cargo responded by cutting the study and half of its staff. Two months later, the remaining 90% of employees were sent packing.
Cargo raised $200 million in an oversubscribed series A in March 2023, a megaround that underscores the potential that investors once saw in its CAR T cell therapies.
Now, the company is ready to wind down with Concentra’s help. Cargo’s board determined that the transaction was in the best interest of shareholders. The deal, which has been unanimously approved by the board, is contingent on Cargo having $217.5 million in cash on hand at closing.
Concentra, a biotech buyout firm backed by Tang Capital, has been on a buying spree this year. It was the most prolific biotech buyer of the first half, scooping up three companies, including Kronos in May and Elevation Oncology at the end of June. And only a week into the third quarter, Concentra has two more. In addition to Cargo, Tang’s company bought out IGM Biosciences last week.
Biotechs don’t always accept Concentra’s advances lying down, however. In March, Pliant and Acelyrin both fought back via poison pill stockholder rights programs.
