Cancer treatment developer Cargo Therapeutics Inc. plans to raise as much as $367 million in its initial public offering.
The San Mateo startup plans to sell 18.75 million shares for between $15 and $17 a piece, according to a document filed Monday with the Securities and Exchange Commission. Cargo is also setting aside 2.8 million shares for its underwriters — JP Morgan, Jefferies, TD Comen and Truist Securities.
At the top of its range, the offering would give Cargo an initial market capitalization of $657.39 million, assuming the underwriters don't exercise their option on its shares. The company plans to list its stock on the Nasdaq under the ticker CRGX.
Cargo is developing a kind of immunotherapy designed to treat large B cell lymphoma, a non-Hodgkins variant of the disease. The company, which was spun out of Stanford University, is in Phase 2 trials for one use of its treatment. The company has a licensing agreement with Stanford for its technology.
Headed by CEO Gina Chapman, a veteran of South San Francisco's Genentech Inc., Cargo plans to use the proceeds from its IPO to fund clinical development and further research and to provide working capital. The company, which isn't yet generating any revenue, posted a $30.6 million loss in the first half of this year after losing $41 million in all of last year.
Cargo's operations and capital expenditures burned through $31 million in the first six months of 2023 after consuming $31.8 million for all of 2022.
Through the end of June, the company had an accumulated deficit of $77.6 million since its founding nearly four years ago.
In its filing, Cargo warned potential investors of the risks of investing in it as a clinical-stage biotechnology company. It will be several years, "if ever", before it has a commercialized product, Cargo said.
The company's move toward an IPO comes eight months after it announced it had raised $200 million in a Series A round co-led by Third Rock Ventures, RTW Investments, LP and Perceptive Xontogeny Venture Fund.
Pre-IPO, Cargo's biggest investors are Samsara BioCapital, which holds a 17.3% stake; a fund managed by Perceptive Venture Advisors, which holds 12.9%; and Third Rock Ventures, 11.1%.
Earlier this year, Cargo named Michael Ports as its chief scientist. Ports previously worked at Janssen Pharmaceuticals Inc., where he led its cell therapy efforts.
Additionally, the company recently appointed Ginna Laport as its chief medical officer. Laport was previously the vice president of clinical development at Genentech.
San Francisco Business Times reporter Ron Leuty contributed to this report.
