West Lafayette biotech raises $40M to develop cancer-imaging drugs

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On Target Laboratories Inc., a company developing cancer-imaging technology developed at Purdue University, has raised $40 million to advance the development of its compounds.

The West Lafayette-based company said Wednesday the funding round was led by new investor JJDC Inc., the investment arm of Johnson & Johnson, the biotech and consumer-goods giant.

On Target said it will use the funding to further develop its lead imaging compound, OTL38, for use in detecting multiple cancers, including ovarian and lung, and to develop a second imaging compound for additional cancers.

OTL38, which will shortly be entered into a Phase 3 clinical trial, is given to patients intravenously before surgery. The compounds use a bright fluorescent dye to target and illuminate cancer cells during surgery, leaving normal healthy cells dark.

The dyes are designed to help surgeons identify and resect malignant lesions that that are too small to be seen with the naked eye.

In clinical trials of OTL38 in lung cancer surgery, On Target is evaluating whether the compound allows surgeons to better locate smaller nodules, enabling them to spare healthy tissue.

The technology was developed by Philip S. Low, a chemistry professor at Purdue and co-founder of On Target.

Low discovered that cancer tumors have a greater number of certain kinds of “receptors” on the surface of their cells. By combining a molecule that binds to these receptors with a fluorescent molecule, On Target’s technology can make the cancer cells light up during surgery.

The new round of funding is a combination of equity and convertible debt financing, the company said.

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