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Cancer Protein Therapy Biotech Raises $400M in IPO

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(A. Kotok)

16 July 2020. A three year-old company developing protein-targeted cancer therapies with computational techniques is raising $400 million in its initial public offering of common stock. Relay Therapeutics Inc., trading on the Nasdaq exchange under the symbol RLAY, today priced its 20 million shares at $20.00, but by the closing bell, shares sold at $35.05, nearly double that price.

Relay Therapeutics, in Cambridge, Massachusetts, discovers therapies for diseases considered difficult to treat, using methods based on protein movement and dynamics. Most conventional research, says the company, treats proteins as static entities, but Relay’s technology, called Dynamo, discovers drugs by analyzing the dynamics of proteins, which combines the structure of protein molecules, with chemistry, biophysics, and computational techniques.

The company applies the Dynamo technology to precision cancer treatments addressing specific molecular targets, rather than cancers found in specific organs or tissue. Its lead candidate, code-named RLY-1971, binds to and stabilizes SHP2 proteins that drive proliferation of cancer cells and support resistance to targeted therapies. Relay believes RLY-1971 can block the route some cancers use to avoid other cancer treatments, thus overcome resistance by some cancers to therapy.

RLY-1971 is currently in an early-stage clinical trial testing the drug for safety and to determine a maximum tolerated dose, among participants with advanced or metastatic solid tumor cancers. The trial excludes patients with tumor mutations that may not be amenable to RLY-1971.

Another Relay therapy candidate approaching clinical trial stage is code-named RLY-4008, designed to limit the protein fibroblast growth factor receptor 2, or FGFR2. The FGFR2 protein plays a key role in bone growth, but is also implicated in several solid tumor cancers. Relay says in preclinical studies, RLY-4008 shows promise in cancer of bile ducts, and the company plans to test the drug in clinical trials against specific molecular targets, while not affecting other fibroblast growth factor receptor proteins.

Relay Therapeutics was founded in 2017 by four entrepreneurs and researchers on whom the company’s technology is based, including David Shaw, research fellow in computational biology and bioinformatics at Columbia University, and chief scientist at David E. Shaw Research in New York, with Mark Murcko, a lecturer in biological engineering at MIT, and founder or advisor to several biotechnology companies.

Joining Shaw and Murcko as Relay’s founders are Dorothee Kern, biochemistry professor at Brandeis University who investigates dynamic processes of biological molecules, and Matthew Jacobson, professor of pharmaceutical chemistry at University of California, San Francisco, who studies computer-aided drug design, particularly in predicting actions of enzymes and regulating energy functions in proteins.

RLAY shares opened today at the IPO price of $20.00, but by noon rose to about $35.00, an increase of 75 percent, and continued at about that price until closing at $35.05. In comparison the overall Nasdaq composite index closed down more than 76 points or -0.73 percent for the day.

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