Tocagen raised $85 million in its stock market debut today, and underwriters saw enough demand to increase the number of shares in the initial public offering. Tocagen has been developing a gene therapy treatment for a deadly type of brain cancer.
Tocagen revealed its IPO plans last month, saying it wanted to use the stock offering to finance clinical trials of its treatment for recurrent high-grade glioma, a deadly form of brain cancer. The company is trying to treat the cancer with gene therapy, an experimental approach that aims to use transplanted genes in order to treat disease. So far, the FDA has approved no gene therapy treatments.
Tocagen’s gene therapy uses two components that come together in the brain and work to get cancer cells to produce anti-cancer compounds. The first component is injectable vocimagene amiretrorepvec (Toca 511), which carries the genetic coding that enables cancer cells to produce a cytosine deaminase (CD), protein key to making cancer-fighting compounds.
The second component of the Tocagen gene therapy is the antifungal pill 5-fluorocytosine (5-FC). Tocagen says that this antifungal can cross the blood brain barrier and reach cancer cells. The CD protein produced in the cancer cells then works to convert the second component of the gene therapy, the ingested antifungal drug, into the cancer-fighting compound 5-fluoracil. Tocagen says the advantage of its approach is treatment localized to the cancer cells.
So far, Tocagen has treated 126 brain cancer patients in three Phase 1 clinical trials. The company had also started the Phase 2 portion of a planned Phase 2/3 trial. According to Tocagen’s prospectus, enrollment of that 187 patient Phase 2 trial was completed in February. Tocagen says in the filing that it plans to use $25 million of the IPO proceeds to finance the rest of the Phase 2 trial through a review of top line results. Tocagen plans to use $20 million for drug manufacturing; another $15 million is earmarked for planned Phase 1b clinical trials in patients newly diagnosed with high-grade glioma.