Mirati Therapeutics plans to raise more than $200 million this week in a public offering, funding that it plans to use to advance its lead cancer drug candidate, sitravatinib, into late-stage testing, and to continue developing its other targeted oncology programs.
The San Diego company said Tuesday that it would sell 2.1 million shares of its common stock at $97 apiece, raising gross proceeds of $203.7 million. (Its underwriters have the right to buy another 315,000 shares in connect with the offering, which would tack on another $30 million or so.) On Wednesday, shares of Mirati (NASDAQ: MRTX) closed at $100.01.
Mirati’s sitravatinib is an experimental treatment for patients with non-small-cell lung cancer (NSCLC). The company is testing the drug in combination with checkpoint inhibitors, a type of cancer immunotherapy, to target a class of proteins called tyrosine kinases. The combination will be compared to chemotherapy.
The company plans to start its Phase 3 trial of the experimental combination in patients with NSCLC—a type of lung cancer that makes up about 80 percent to 85 percent of all such tumors—by month’s end. Lung cancer is the leading cause of cancer death for both men and women; about 228,150 new cases of the disease are anticipated this year, according to the American Cancer Society.
Mirati’s Phase 3 study is enrolling patients whose cancer has progressed even after treatment with checkpoint inhibitors. According to the company’s prospectus, the study will include an interim analysis of the percentage of patients whose cancers respond to treatment. Analysis of this surrogate endpoint—an early look to see whether the treatment works—is expected to be completed by the end of 2020. The company says in the filing that this surrogate endpoint could be the basis for a submission for accelerated FDA approval. The main goal of the Phase 3 study is overall survival, the length of time that patient lives following the start of treatment.
In addition to the sitravatinib program, Mirati is also developing another drug, MRTX849, which blocks a mutation in the KRAS gene that is associated with certain lung cancer cells. The experimental drug is in Phase 1/2 testing.
Back in October, Mirati’s stock took a 15 percent hit after new data from its Phase 2 combination trial of sitravatinib in combination with nivolumab (Opdivo), an immunotherapy from Bristol-Myers Squibb (NYSE: BMY), disappointed investors. But it saw a 35 percent bump in the wake of January’s JP Morgan Healthcare Conference after the company updated investors about its pipeline.
And Mirati stock jumped again more than 20 percent day-over-day early this month after Amgen (NASDAQ: AMGN), which is also developing a drug targeting KRAS in patients with advanced lung cancer, revealed promising Phase 1 data at the American Society of Clinical Oncology conference. The data reported were from the first-ever clinical trial of a KRAS inhibitor. While Amgen’s research is separate from Mirati’s, its results provided additional validation for drugs being developed to target the KRAS mutation.
The money Mirati is raising will also go toward its preclinical programs, which include another KRAS inhibitor, and for working capital, the company said in a news release.