The quiet resurgence of Cellular Biomedicine

Cellular Biomedicine Group once made a bold bid to enter China’s Car-T market, listing its shares on Nasdaq and courting controversy in the process, but in 2021 it went private and entered obscurity. That lasted until this week.

A licensing deal with Johnson & Johnson on Tuesday gave it an immediate $245m cash injection in return for two clinical-stage Car-T projects that do not, on the face of it, look spectacular. This is not the first time CBMG has received big pharma endorsement – a 2018 tie-up featured none other than Novartis – but it is the most lucrative.

J&J’s own Car-T breakthrough came through a deal with another China-focused group, Legend Biotech, and yielded Carvykti. The US company has now gained ex-China rights to CBMG’s C-CAR039 and C-CAR066, which are in trials for non-Hodgkin’s lymphoma at City of Hope and the Mayo Clinic respectively; responsibility for these studies now passes to J&J.

Both assets are autologous and both hit CD20, the target of successful drugs like Rituxan and Gazyva, but that has so far yielded little promising data for cell therapy approaches. C-CAR039 also hits the well-known CD19, the idea being that relapse by antigen escape can be avoided; Miltenyi Biotec is clinically studying a project that, while very similar, is unrelated.

While CMBG calls the assets novel it is unclear in what way they might differ from current-generation Car-T therapies. At Ash 2020 the company profiled a separate pipeline asset, the BCMA-targeting C-CAR088, which it said was a second-generation Car; however, apart from its humanised binding domain, this uses a fairly standard Car construct.

Major China push

CBMG had burst onto the cell therapy scene in 2015 when it bought rights to Chinese PLA General Hospital’s Car-T assets, making an instant bid to become a major local cell therapy player. Among the assets were Cars against CD19 and CD20, so it is possible that the projects licensed to J&J are based on this work.

It made other small acquisitions, and struck deals with the NCI and Novartis, becoming the latter’s China manufacturer for Kymriah as well as giving the Swiss firm rights to undisclosed tech. However, many of these efforts no longer appear in CBMG’s pipeline, which now also includes TILs and a Car therapy against autoimmune disease.

In August 2020 CBMG’s management took the group private at a valuation of around $385m, with cash secured from several funds, and little has been heard from the company since then. This week’s J&J deal is CBMG’s first serious cash injection since a $120m series A round closed in September 2021.

It will not go unnoticed that cash that has come into the business in the past two years is almost equal to its take-private valuation. It will be interesting to see what valuation CBMG might attract at IPO, if indeed it now chooses to pursue the public path again.