TransCode Therapeutics Secures $25M Investment and Acquires Cancer Vaccine in Strategic Deals

TransCode Therapeutics, a biotechnology company facing financial uncertainty, has announced two significant deals that promise to reshape its future. The company has acquired Polynoma and its phase 3 cancer vaccine while simultaneously securing a $25 million investment, albeit at the cost of substantial equity dilution.

Acquisition of Polynoma and Cancer Vaccine

TransCode has agreed to purchase Polynoma, a subsidiary of Hong Kong-listed CK Life Sciences, in an all-stock transaction. This acquisition brings with it seviprotimut-L, an off-the-shelf vaccine containing human melanoma antigens that has completed a phase 3 study. The vaccine is designed to stimulate both humoral and cellular immune responses, potentially leading to tumor cell death.

While the phase 3 study completed in 2021 relied on an exploratory efficacy model to justify further development, preparations for a confirmatory trial are underway. TransCode could pay up to $95 million to CK Life Sciences if seviprotimut-L meets specific clinical, regulatory, and commercial milestones.

Financial Lifeline and Equity Restructuring

In conjunction with the Polynoma acquisition, a CK Life Sciences subsidiary has committed to a $25 million investment in TransCode. This investment comprises $20 million in cash and a $5 million note, providing a crucial lifeline for the cash-strapped biotech.

TransCode ended June with only $7.4 million in cash, having burned through $7.3 million in the first half of the year. The company had previously warned investors of substantial doubt about its ability to continue operations for another 12 months.

However, this financial rescue comes at a significant cost to existing shareholders. Once the deals close, CK Life Sciences will own approximately 91% of the resulting company, leaving pre-acquisition TransCode stockholders with the remaining 9%.

Leadership Changes and Future Plans

Alongside these strategic moves, TransCode has announced a change in leadership. Philippe Calais, Ph.D., who has been on TransCode's board since 2018, has been appointed as the new CEO, replacing interim CEO Tom Fitzgerald. Fitzgerald will continue to serve as Chief Financial Officer.

Looking ahead, TransCode is planning to initiate a phase 2a trial of its internal program TTX-MC138, a microRNA-10b inhibitor, next year. This trial represents a key milestone for the company's pipeline beyond the newly acquired cancer vaccine.

The market has responded positively to these developments, with TransCode's shares trading up about 16% to $14.18 following the announcement.