Cue Biopharma Inc. stepped into the bright lights of the immuno-oncology (I-O) stage, adding a $16.4 million round to seed funding of $10 million to accelerate development of its platform of T-cell receptor (TCR) biologics targeting cancer and autoimmune diseases.

MDB Capital Group served as lead investor.

Daniel Passeri, who joined Cue in September as president and CEO, is keenly aware of both the excitement and the crowd in I-O, but he insisted the Cambridge, Mass.-based company has a clearly differentiated approach.

"One thing that's come out of this crowded space is knowledge about how checkpoints work, and where they don't work," said Passeri, former president and CEO of Curis Inc. The field is coming up to speed on the benefits of pro-stimulatory molecules as well as their downside – principally the prospect of systemic toxicity, he added.

"This is a good time for our technology to emerge," Passeri told BioWorld Today.

As its name implies, the company's aim is to modulate the immune system "on cue" – that is, by "giving very specific messages to disease-relevant T cells," he explained.

The platform enables the design of biologics that generate tailored immune responses from those T-cell populations by emulating the signals delivered by the body's antigen-presenting cells. The mechanism for achieving that level of specificity involves the fusion of engineered T-cell co-stimulatory signaling molecules with a T-cell receptor-targeting complex on a traditional antibody scaffold. When the peptide interacts with disease-relevant T cells, the biologic delivers one of Cue's engineered signaling ligands and selectively modulates the T-cell population of interest.

"What we've seen to date is that checkpoint inhibitors are blocking the protective buffering mechanism that tumor cells use to shut off T cells while the more global approach is to inject patients with these modulatory molecules, which have pretty deleterious side effects," Passeri said.

Cue's agents, instead, exert their effect on T-cell activation in the periphery, avoiding the influence of the immunosuppressive tumor microenvironment. The approach offers the potential for use both as a monotherapy and in combination with checkpoint inhibitors while avoiding the toxicity limitations associated with non-specific T-cell activation.

Cellular approaches, he added, seek to create custom-designed T cells by amplifying them outside the body and then returning them to the patient. Because Cue's agents are administered by injection and activate T cells in vivo, they avoid ex vivo manufacturing constraints associated with cellular approaches.

Cue's initial focus is in oncology, and early stage candidates are designed to amplify the response of the relatively small population of T cells that do the heavy lifting to fight cancer. Because the company's biologics can be selectively modulated, however, they also offer the opportunity to attenuate heightened T-cell activity to treat autoimmune disease. The peptides capable of selectively targeting T-cell subsets are interchangeable on the Cue construct, allowing the company to extend, or pivot, to different indications simply by changing the specific peptide.

So far, the company's "exquisite ability for selective disease-relevant T-cell modulation" has shown "a remarkably attractive therapeutic window" as a monotherapy on the oncology side, Passeri said, "and we're truly impressed by the profound synergy we've seen with checkpoint inhibitors." He described that synergy as "enhanced activity with lower dosing," along with the ability to "manage the collateral toxicities," potentially offering a greater therapeutic window in the clinic.

'DEVELOPING, ESSENTIALLY, IMMUNOLOGICAL SCALPELS'

For now, the findings are still preclinical, but the technology has an impressive pedigree. The platform emerged from the lab of Steven Almo, chairman of the department of biochemistry and professor of biochemistry and of physiology and biophysics at New York's Albert Einstein College of Medicine/Montefiore Medical Center and a founder and chairman of the scientific advisory board at Cue.

Company co-founders and co-inventors Ronald Seidel, Cue's executive vice president and head of R&D, and Rodolfo Chaparro, executive vice president and head of immunology, worked directly with Almo. Seidel was research assistant professor of biochemistry and associate director of the Macromolecular Therapeutic Development Facility at the Einstein College of Medicine, while Chaparro served as a faculty member in the department of biochemistry.

Cue's platform was developed as part of a five-year NIH grant, which enabled the technology to be built into an industry-scale drug design platform for rapid molecular prototyping and development.

"Effectively, Steve, who's a structural biologist, Ron, who's a protein engineer and molecular biologist, and myself, the immunologist, were able to leverage a very powerful production platform that was developed with the NIH funding," Chaparro told BioWorld Today. Tinkering with the technology over a five-year period, the group followed the emerging I-O space and posed key questions about how to engineer, from the ground up, therapeutics that provided exclusive specificity and potent efficacy without the toxicity generally associated with co-stimulation.

"We came up with this idea that you could engage only the relevant T cells," he said.

But the group discovered that the genetic fusion of a peptide-major histocompatibility complex, or MHC – which engages the TCRs – was "necessary but not sufficient to drive the immune reaction," Seidel explained. Attaching certain co-stimulators covalently to engage the TCR while also activating or attenuating the signal addressed that problem.

"What we achieved is an injectable biologic that talks to T cells directly," Seidel said. The elegant approach enables Cue essentially to program its therapeutics to target and de-bulk tumors or, on the other hand, to broadcast a message to the entire immune system to treat autoimmune disease.

"We're developing, essentially, immunological scalpels vs. the sledgehammers that are currently on the market," Seidel told BioWorld Today.

Cue was formed with an exclusive license to the platform from the Einstein College and the company continues to expand the intellectual property.

Equipped with proteins that already are derivatized with both peptide and modulatory components and a set of algorithms to design additional drugs efficiently, the company expects to name a lead candidate in a human papillomavirus-driven cancer – for now, identified as CUE-101 – by the end of this quarter and to file an investigational new drug (IND) application during the first half of 2018. The new $16.4 million financing "sets us up well for the foreseeable future, and a bit beyond that," Passeri said, including the completion of IND-enabling studies. He expects Cue to hit additional milestones before the company seeks another round.

"We're looking at several alternatives that give us optionality on capital access," Passeri said.

Cue's board members encompass both ends of the immunology spectrum. They include Peter Kiener, chief scientific officer at Sucampo Pharmaceuticals Inc. and an alum of Astrazeneca plc's Medimmune unit; biopharma veteran Barry Simon, president and chief administrative officer of Nantkwest Inc.; and Steven McKnight, who heads a research laboratory at the University of Texas Southwestern Medical Center, co-founded Tularik Inc., which went to Amgen Inc. in 2004 for $1.3 billion, and founded oncology firm Peloton Therapeutics Inc., of Dallas. (See BioWorld Today, Oct. 22, 2004, and July 28, 2011.)

The big biopharma connections could come in handy. Cue is engaged in partnering discussions with multiple prospects, according to Passeri, who suggested a collaboration could be consummated in the second half of the year.

The company has 16 employees and expects to grow to about 25 by year-end, using a hybrid approach to advance its pipeline.

"We do not want to out-license our platform," Passeri emphasized. "Strategically, we'd like to be able to accomplish a strategic relationship with a pharma company that provides us with greater resources, complements our competencies and allows us to do preclinical and early clinical development, with the right to co-develop several of the assets. That would create substantial upside potential for our shareholders."

But long term, the company isn't "building the company with some strategic objective for an exit," Passeri maintained. "We're building the company to get the drugs in the clinic and to demonstrate that this represents a next-generation immunomodulation approach."

"No one else at this time, to my knowledge, is attempting what we're doing, which is to directly engage T cells in such a selective way," Chaparro added. "This is the future. Whoever can dictate cellular behavior with pharma agents, with respect to the immune system – especially in oncology – will be driving the technologies that we see in the clinic."