Mestag Therapeutics has raised $40 million and appointed two senior executives as it prepares to move its lead cancer programme into the clinic.

The Cambridge-based biotech said the financing will support the Phase 1 Starlys trial of MST-0312, a bispecific antibody targeting fibroblast activation protein and lymphotoxin-β receptor in solid tumours. The study is expected to begin in mid-2026.

The round was backed by SV Health Investors, Johnson & Johnson Innovation, Forbion, GV and Northpond Ventures, bringing total funding to more than $95 million. The company also confirmed Lindsey Rolfe as chief medical officer and Pascal Merchiers as chief development officer.

Mestag is positioning MST-0312 as a potential option for tumours that do not respond well to existing immunotherapies. The drug is designed to stimulate the formation of tertiary lymphoid structures and high endothelial venules, which have been linked to improved survival and stronger responses to treatment in solid tumours.

Susan Hill, chief executive officer of Mestag Therapeutics, said: “We are thrilled to welcome Lindsey and Pascal to the team at this exciting time as we progress our groundbreaking program MST-0312 into the Starlys clinical trial.”

She added: “We thank our exceptional investor syndicate for their unwavering support of our mission to develop impactful new antibody therapeutics for patients with cancer and inflammatory disease.”

The funding and appointments signal a shift for Mestag as it transitions from platform development into clinical-stage execution. Early-stage biotech companies often face pressure at this point to demonstrate both clinical progress and operational depth, particularly in oncology where competition is high.

Rolfe joins with experience in clinical development and regulatory strategy, most recently serving as chief medical officer at 3B Pharmaceuticals. She previously held the same role at Clovis Oncology, where she led programmes that resulted in approvals for Rubraca in ovarian and prostate cancer.

Merchiers brings experience in antibody development and early-stage pipelines, having held leadership roles at Commit Biologics, Aboleris and Oncurious. His background includes work on immunology-driven oncology approaches, including regulatory T cell targeting.

The Starlys trial will be a key test of Mestag’s fibroblast immunology platform, which focuses on the tumour microenvironment rather than directly targeting cancer cells. While interest in this approach has grown, clinical validation remains limited, and several companies are exploring similar strategies.

The financing appears to be a typical clinical entry raise rather than an outlier in the current biotech funding environment, where investors remain selective and often prioritise clear development milestones. The inclusion of large strategic and venture investors suggests continued interest in novel immuno-oncology mechanisms, but the success of MST-0312 will depend on early clinical data.

Mestag said proceeds will also support ongoing work in inflammatory diseases, indicating a broader pipeline beyond oncology. However, near-term attention is likely to focus on the Starlys study and whether the company can generate data to support further development.