UW-founded cancer immunotherapy developer Neoleukin Therapeutics will merge with Aquinox in an all-share deal giving the spinout's shareholders roughly 38.6% equity in the new company.

Neoleukin Therapeutics, a US-based cancer immunotherapy developer spun out of University of Washington, is to merge with US-listed biopharmaceutical company Aquinox in an all-stock transaction.
Aquinox will pay for Neoleukin’s outstanding equity with 14.8 million new common and preferred shares, equating to a value of $43.5m as of their opening price today. It plans to rebrand as Neoleukin Therapeutics once the transaction closes on August 8.
Former Aquinox and Neoleukin shareholders will respectively own roughly 61.4% and 38.6% of the new business, which will take Aquinox’s place on the Nasdaq Global Market stock exchange.
Founded in November 2018, Neoleukin has been developing a synthetic variant of an existing oncological protein called interleukin-2 known to promote the treatment of cancer by stimulating immune system T-cell receptors.
Neoleukin’s first candidate, Neo-2/15, was designed using a computational protein modelling system called Rosetta which determines a protein’s final structure from its amino acid sequence – a technique known as de novo protein structuring.
Rosetta was invented in the lab of David Baker, professor of biochemistry and head of the Institute for Protein Design at University of Washington’s Department of Chemistry.
With the acquisition, Neoleukin’s de novo protein discovery program will be combined with Aquinox’s existing portfolio so that the new company will have candidates targeting autoimmune and inflammatory disease as well as cancer. Jonathan Drachman, the current CEO of Neoleukin, will retain his post.
Details of Neoleukin’s earlier equity funding have not been disclosed but the merged business will have approximately $65m in cash and cash equivalents, considered enough runway to last until the end of 2021, according to a filing.