Avacta will use the funds to accelerate the collaboration with Tufts University Medical School on the drug, which is a new form of standard cancer drug Doxorubicin.
Doxorubicin has been a standard of care for soft tissue sarcomas for 40 years, but its use is limited by the heart damage it causes. Even so, the drug still generates US$1bn a year in revenues.
AVA6000, the combination with the technology licensed from Tufts last year is inert until activated by a tumour, which reduces the heart’s exposure to the chemotherapy and concentrates the active drug in the tumour.
Testing of ‘AVA6000 Pro-Doxorubicin’ has been limited to mice so far, but Avacta plans to start dosing patients in a phase 1 clinical trial in the second quarter of 2020, pending application and regulatory approval.
Avacta had previously said its first drug into human trials would be an Affimer PD-L1 inhibitor cancer treatment known as AVA004, but has decided to focus on Pro-Doxorubicin because it provides an opportunity for major licensing deal much sooner.
The £9mln of new money is being raised through a placing at 15p though there is also a small subscription.
Alastair Smith, chief executive, said that it was an “exciting time on all fronts” for the group and not just Pro-Doxorubicin.
Seven evaluations are ongoing with possible partners, he said, which includes four out of the top ten global diagnostics companies.
Heavier research spending meant a loss before tax of £11.1mln, in the year to July.
Gross profits though jumped 72% to £3.2mln, which included US$2.5mln received from new partner LG Chem Life Sciences.
Last December, LG Chem, a Korean group, agreed to fund development and eventually license Affimer technology in a deal potentially worth over US$300mln.