- New investment and debt conversion by new and existing investors sets company's post-money valuation at approximately $220 million, up 214% from previous funding round.
- Financing supports further expansion of NeOnc's NEO platform technology that has produced a patent portfolio of novel drug candidates and delivery methods for more effectively passing the blood brain barrier.
- Two Phase II and one Phase I clinical studies advance after several published studies indicate NEO drug viability as a delivery vehicle for chemotherapeutics and ability to beneficially effect brain cancer treatment.
WESTLAKE VILLAGE, Calif., June 26, 2024 (GLOBE NEWSWIRE) -- NeOnc Technologies Holdings, Inc., a clinical-stage medical biotechnology company, has completed a $18.5 million financing to support the ongoing development and Phase I and II clinical studies of its novel drug and delivery methods designed to address the persistent challenges with overcoming the blood-brain barrier.
The financing secured $4.5 million in new equity investment from existing and new investors. It also converted to equity all outstanding notes held by lenders along with accounts payable to University of Southern California (USC) totaling $14 million, thereby eliminating all outstanding short-term debt. The transactions were completed with the issuance of Class A common stock priced at $12 per share.
The financing sets NeOnc's post-money valuation at approximately $220 million, an increase of 214% from the previous $10 million equity funding the company announced in February of last year. It brings the total amount of committed equity since inception to more than $31 million.
The new financing supports further development and expansion of NeOnc's NEO platform technology that has generated an extensive patent portfolio. Secured under exclusive worldwide rights from USC, NeOnc's intellectual property portfolio includes 135 U.S. and international patents issued and patents pending.
The company believes the funding also provides the financial and net equity requirements for a potential direct listing on a national stock exchange.
"We believe this latest funding round and debt conversion demonstrates the strong confidence in our technology and future growth prospects expressed by both new and existing investors, as well as by our strategic research partners at USC," stated NeOnc executive chairman, Amir Heshmatpour. "It underscores our commitment to fortifying our financial position as we complete our current clinical trials. It also opens the door to a number of options we now enjoy for accessing the capital markets that would be most favorable to our investors and invested management team."
According to NeOnc's founder, CEO and CSO, Thomas Chen, M.D., Ph.D.: "Most importantly, the funding supports our mission of improving and extending the lives of brain cancer patients by developing therapies that maximize the effectiveness and delivery of current standard-of-care drugs for brain cancer."
Dr. Chen is a widely respected neurosurgery professor and medical expert who brings to NeOnc more than 30 years of medical and clinic research experience. A board-certified neurosurgeon, he is also currently the director of Surgical Neuro-Oncology at USC. He was recognized last year for his achievements by the American Health Council with its coveted Best in Medicine Award.
NeOnc's proprietary biotechnology breakthroughs are the result of more than a decade of research and development by Dr. Chen and his accomplished medical and scientific teams. Dr. Chen has been leading the company's Phase I and II clinical trials.
Metastases to the brain are the most common brain tumors in adults and this develops in nearly 30% of patients with solid tumors. Traditional cytotoxic drugs have had a limited role in the management of these cancers and no standard systemic therapy exists.
"We believe one of our lead drug candidates, NEO212, could have a meaningful impact on solid tumor patients who develop uncontrolled brain metastasis and who are often excluded from traditional clinical trials," noted Dr. Chen. "We also believe that NEO212 may have the potential to treat primary brain tumors as well as potentially work with systemic therapy to improve outcomes in patients who develop brain metastasis."
By enabling greater penetration of the blood-brain barrier, Dr. Chen believes the company's NEO technology can turn existing FDA-approved drugs into more effective treatments across a full range of central nervous system (CNS) disorders. The company is currently developing several additional proprietary chemotherapy agents that have demonstrated positive effects in laboratory tests on other various types of cancers.
NeOnc has secured FDA Fast-Track status for its leading drug candidates that supports its clinical trials. FDA grants Fast-Track status when a drug is shown to treat a serious condition and provides an unmet medical need or therapy that may be potentially better than other available therapies. The criteria includes if the drug will impact survival and day-to-day functioning, or if left untreated, the disease will progress from a less severe condition to a more serious one.
The drug must also show superior effectiveness, significant decrease in serious side effects and the ability to improve the diagnosis of a serious condition. Additionally, it must demonstrate a decrease in clinically significant toxicity over available therapies, and an ability to address emerging or anticipated public health needs.
NeOnc has also secured the FDA's classification as an Orphan Drug (OD). OD status is granted by the FDA to a substance that shows promise in treating, preventing or diagnosing an "orphan disease;" that is, diseases that currently affect less than 200,000 people. OD status provides a seven-year window of exclusive marketing rights, fee reductions, and additional tax incentives. The FDA gathers and shares information from Patient-Focused Drug Development (PFDD) meetings which companies like NeOnc can use in its drug development.
OD status also provides a more streamlined clinical trial process, including not having to perform Phase I safety studies, binding, placebo, and randomization criteria. Once sufficient effectiveness and safety data is shown, a New Drug Application (NDA) can be submitted for a Fast-Track review by the FDA.
"In consultation with the FDA under OD and Fast-Track status, we expect to collect sufficient data that demonstrates the important therapeutic value of our lead drug candidates," added Dr. Chen. "We believe our novel intranasal delivery approach makes a study in a pediatric population, in particular, easier than other methods. Radiation and chemotherapy for children with high-grade gliomas is complex, time consuming and prognosis remains poor. All this underscores the importance of developing effective therapies that are less invasive and more tolerant for pediatric and other challenged populations."
The NEO drug development platform addresses a global CNS treatment market that is projected to grow at a 9.4% CAGR to $166.5 billion by 2028. The global brain tumor drug market is projected to expand at a 10.2% CAGR to reach $3.7 billion by 2030.
Driving this growth is an increasing incidence of such diseases with the aging population. However, radiation therapy still accounts for 38% of the brain cancer treatment market, with drug treatment remaining second to radiation therapy mostly due to current inefficiencies of drug delivery.
About NeOnc Technologies Holdings
NeOnc Technologies is a privately held clinical stage life sciences company focused on the development and commercialization of central nervous system therapeutics that are designed to address the persistent challenges in overcoming the blood-brain barrier.
The company's NEO drug development platform has produced a portfolio of novel drug candidates and delivery methods with patent protections extending to 2038. These proprietary chemotherapy agents have demonstrated positive effects in laboratory tests on various types of cancers and in clinical trials treating malignant gliomas. NeOnc's NEO100 and NEO212 therapeutics are in Phase II human clinical trials, and are advancing under FDA Fast-Track and Investigational New Drug (IND) status.
The company has exclusively licensed an extensive worldwide patent portfolio from the University of Southern California consisting of issued patents and pending applications related to NEO100, NEO212, and other products from the NeOnc patent family for multiple uses, including oncological and neurological conditions.
For more about NeOnc and its pioneering technology, visit neonctech.com.
Important Cautions Regarding Forward-Looking Statements
All statements other than statements of historical facts included in this press release are "forward-looking statements" (as defined in the Private Securities Litigation Reform Act of 1995). Generally, such forward-looking statements include statements regarding our expectations, possible or assumed future actions, business strategies, events, or results of operations, including statements regarding our expectations or predictions or future financial or business performance or conditions and those statements that use forward-looking words such as "projected," "expect," "possibility" and "anticipate," or similar expressions. The achievement or success of the matters covered by such forward-looking statements involve significant risks, uncertainties, and assumptions. Actual results could differ materially from current projections or implied results.
NeOnc Technologies Holding, Inc. (the "Company") cautions that statements and assumptions made in this news release constitute forward-looking statements without guaranteeing future performance. Forward-looking statements are based on estimates and opinions of management at the time statements are made. The information set forth herein speaks only as of the date hereof. The Company and its management are under no obligation, and expressly disclaim any obligation, to update, alter, or otherwise revise any forward-looking statements following the date of this news release, whether because of new information, future events, or otherwise, except as required by law.
NeOnc Company Contact:
Patrick Walters, COO
NeOnc Technologies Holdings, Inc.
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NeOnc Investor Relations:
Ron Both or Grant Stude
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NeOnc Media Contact:
Tim Randall
CMA Media Relations
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