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Surface Oncology Shares Trade Up 40% on Phase1 Study Plans for SRF617 Combined with Merck's KEYTRUDA

Streetwise Reports, Streetwise Reports
0 Comments| May 21, 2020

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Shares of Surface Oncology set a new 52-week high price after the company reported that it is partnering with Merck & Co. in an immuno-oncology study of SRF617, targeting CD39 in combination with KEYTRUDA® (pembrolizumab) in solid tumor patients.

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Clinical-stage immuno-oncology company Surface Oncology Inc. (SURF:NASDAQ), which is engaged in developing next-generation immunotherapies targeting the tumor microenvironment, announced today that "it has entered into a clinical trial collaboration with Merck & Co. Inc. (MRK:NYSE), known as MSD outside the U.S. and Canada, through a subsidiary, to evaluate the safety and efficacy of combining Surface's SRF617, an investigational antibody therapy targeting CD39, with Merck's KEYTRUDA® (pembrolizumab), the first anti-PD-1 therapy approved in the United States."

The company further stated that "this combination will be studied as a component of the first-in-human Phase 1/1b study of SRF617 and will be evaluated in patients with solid tumors, with a focus on patients with gastric cancer and those who have developed resistance to checkpoint inhibition."

The company explained that "SRF617 inhibits CD39, an enzyme critical both to the breakdown of adenosine triphosphate and the production of adenosine and that a substantial body of research supports a role for CD39 in allowing cancer to evade immune responses." The firm claimed that "the combination of SRF617 and KEYTRUDA has the potential to overcome this barrier to immune system activation and promote anti-tumor immunity."

Surface Oncology's Chief Medical Officer Robert Ross, M.D., commented, "Surface is committed to delivering truly breakthrough therapies that can transform treatment for people with cancer. This collaboration with Merck will add an important dimension to our clinical program for SRF617, and allow us to more rapidly assess its potential."

"We have demonstrated in preclinical studies that the inhibition of CD39 results in substantial activation of both the innate and adaptive arms of the immune system. Encouragingly, we also found that activation is heightened in combination with anti-PD-1 treatment and that this combinatory approach has the potential to overcome anti-PD-1 resistance," Dr. Ross added.

In a separate news release, Surface Oncology reported today that "it has raised gross proceeds of approximately $28.9 million through its At-the-Market, or ATM, facility with participation based on interest received from EcoR1 Capital LLC, Venrock Healthcare Capital Partners, BVF Partners L.P. and RS Investments, a Victory Capital investment franchise." The company indicated that it sold approximately 10.9 million common shares at the current market price at the time of $2.66 per share. The firm noted that this transaction exhausted the balance on the $30 million ATM facility.

The company advised that this additional funding will serve to strengthen its balance sheet and the proceed will be used for working capital and other general corporate purposes and to advance its drug pipeline. Specifically, it will help fund the clinical development of SRF617 which is targeting CD39, SRF388 that is targeting IL-27) and the advancement of SRF813 which is targeting CD112R, also known as PVRIG.

Merck & Co., Inc. is headquartered in Kenilworth, N.J., and is one of the world's largest global healthcare companies with a market cap of around $196 billion. The company provides healthcare services and develops, manufactures and markets animal health products, biologic therapies, prescription medicines and vaccines worldwide.

Surface Oncology is an immuno-oncology company based in Cambridge, Mass. The company is developing next-generation antibody therapies for applications on the tumor microenvironment. The firm stated that "its novel cancer immunotherapies are designed to achieve a clinically meaningful and sustained anti-tumor response and may be used alone or in combination with other therapies."

Surface Oncology started off the day with a market capitalization of around $75.3 million with approximately 28.32 million shares outstanding. SURF shares opened more than 37% higher today at $3.65 (+$0.99, +37.22%) over yesterday's $2.66 closing price. The stock has traded today between $3.21 and $4.40 per share and is currently trading at $3.81 (+$1.15, +43.23%).

1) Stephen Hytha compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.
6) This article does not constitute medical advice. Officers, employees and contributors to Streetwise Reports are not licensed medical professionals. Readers should always contact their healthcare professionals for medical advice.

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