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SQZ Biotechnologies CEO on IPO debut, company outlook amid COVID-19

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Cell therapy and technologies company SQZ Biotechnologies began trading on the NYSE today. Armon Sharei, CEO of SQZ Biotechnologies, joins Yahoo Finance's Zack Guzman and Anjalee Khemlani to discuss.

Video Transcript

ZACK GUZMAN: I want to shift our focus over to another area of the market that has been red hot here in 2020 which, which has been IPOs in the biotech space. And today, we're getting another company now beginning to publicly trade here on the New York Stock Exchange.

The ticker symbol SQZ, SQZ Biotechnologies is a company that's been focusing in on a new technology there in terms of cell actions there to help out in a lot of therapies for patients with cancer, infectious disease, and other serious conditions, that's got proprietary technology called CellSqueeze, which is not as complicated as it all sounds.

But I want to dig into that right now at the CEO of SQZ Biotechnologies, as well as Yahoo Finance's Anjalee Khemlani, who joins us now. And Armon Sharei is the CEO of SQL Biotechnologies, and he gets to us now.

And Armon, talk to me about this opportunity here, because a lot of our viewers might not necessarily understand what it is you do, but it does have to do with opening up cell membranes to work on some of these therapies. You guys priced 4.4 million shares last night at $16 apiece. We're seeing shares straight now after they open at about $15 a share. So talk to me about the opportunity and the progress you guys have made so far.

ARMON SHAREI: Thanks so much for having me. And really, for us, what's exciting is, with cell therapies, it's a completely different class of therapeutics. Because over here, you can use cells, which are the basic biological building blocks of our body, as therapeutics, where they can go and pursue some kind of therapeutic benefit for the patient, where you can engineer the immune system, for example, to target a disease or have you shut down an immune response that's causing a problem in autoimmune diseases.

And so our fundamental discovery was that if you squeeze cells at high speeds, which is hence the name of the company, you can disrupt the membrane temporarily, so that anything that's outside I'll go in. And to give you a sense for what this looks like at scale, it's like sending a sumo wrestler through a hula hoop at the speed of sound.

So it's a really quick process, and it was a really simple discovery, but it was a big shift in the field for what you could now do, because we could put all kinds of materials into all kinds of different cell types. That now has allowed us to engineer a lot of biologies that were really difficult in the past. And that's why we can pursue a lot of therapeutics that could make a really big impact in ways that current systems haven't.

And that's what we really started the company around, is to try to bring these new classes of therapeutics to patients. And our lead program right now is something that we're working on in cancer patients that typically have had head and neck cancers or cervical cancer or anal cancers, where we try to turn on the immune response to go and attack those tumor types.


ANJALEE KHEMLANI: Armon, Anjalee here. Good to talk to you. And I know that we've talked about specifically the type of technology, very new, and not something that people are used to, though they do generally relate it to existing cell therapies. You already have interest from Roche, having an agreement signed there. Looking forward, where do you see this going? I know you also jumped into infectious diseases, and obviously, right now in the middle of a pandemic, that's very important. Talk to me about what the opportunity is there.

ARMON SHAREI: Yeah, I mean, for us, the way we see the field is that cell therapies and their initial implementations have shown that they can really do things that other therapeutics couldn't, where they've been able to cure the incurable in certain types of cancers, for example.

But otherwise, they've had a lot of limitations in where they can go, because right now, to get a cell therapy from a patient perspective, there's this intense preconditioning process involved. You end up getting hospitalized on the other end. The cost of manufacturing these therapies and the time it takes to get those drugs to patients can be very difficult to scale.

And with SQZ, we really solved those fundamental problems. And already, with our current trial that's part of our partnership with Roche, we've shown just how different a cell therapy we can create, because for us, with the patient, you don't have to go through preconditioning. You don't get hospitalized on the other side.

And it really allows our cell therapies to actually generate an immune response in your body to go and attack the tumor. It's like we tell the generals of the immune system what to tell the killer T cells in your body to attack, and they relay that message and help turn on your own immune system against the disease.

And to your question on infectious disease--


ARMON SHAREI: Oh, no, I was to say, to your question on the infectious disease side and where we are with the pandemic, this is a mechanism that's very directly applicable in the space of infectious diseases as well. And it goes at it in a way that hasn't been feasible with current vaccines, because this truly turns on the killer response, as opposed to the helper responses and antibody responses that our current vaccines rely on.

And that's why our current vaccines are generally prophylactics, meaning that they can prevent the disease if you don't already have it. But once you have the disease, these vaccines don't work. So this is something that's been really exciting about our mechanism when we apply this to the infectious disease phase. And right now, as we continue with the oncology trial, we're really establishing how this mechanism works, such that we can be quickly ready to address any other infectious disease areas, including COVID-19, in the future.

ANJALEE KHEMLANI: And one of the things that you have to your advantage is the idea that it could be a portable point of care, which also opens the opportunity for quicker treatment in the hospital setting. But I also wonder about the opportunity when it comes to the global level, to the point of vaccines. There's been this forever search for, say, heat-stable vaccines that haven't ever been ready for mass production. So I wonder if you see the opportunity to also be able to go into spaces where treatments are hard to deliver.

ARMON SHAREI: I think it's something that is going to be a continual evolution for these new technologies like cell therapies, where right now with cell therapies, it is a fairly complex and expensive central manufacturing process that people implement. And with our current trial, we've already shown that we can cut the time and costs involved with that by an order of magnitude.

And like you mentioned, we are working on a point-of-care version of the system that would be ready for testing next year that could ultimately sit at the hospital and help provide these therapies to a much broader range of patients.

And in the future, to really drive that accessibility in the long term, one could think about how to further miniaturize and integrate these systems so that you can even have it become more accessible in the field to really maximize the patients we can impact, because the mechanisms you can pursue with a cell therapy are ultimately so much more powerful than what our current vaccine technologies can do.

ZACK GUZMAN: Yeah, I'm just still trying to envision getting a sumo wrestler through the hula hoop. But I like the way you explained that there. Armon Sharei, SQZ Biotechnologies CEO, as well as Yahoo Finance's Anjalee Khemlani. Appreciate you guys taking the time. Congrats, again, Armon.