Using viruses to create new cancer treatments

How an accidental discovery led to the one of the largest biotech buyouts in Australian history and a new stream of cancer-busting immunotherapy drugs.

Pharmaceutical company MSD (a subsidiary of US-based Merck & Co., Inc.) acquired the Australian virotherapy firm Viralytics and the rights to its cancer-busting drug CAVATAK® for $502 million (AUD) in 2018.

Professor Darren Shafren developed CAVATAK®, founded Viralytics with support from the University of Newcastle, and spent 20 years guiding his experimental drug through various clinical trials.

He’s now the Chief Scientific Officer in a new immunotherapy venture that’s secured over $40 million in investments and strong interest from biopharma firms.

Immunotherapies for cancer care

While traditional cancer treatments such as surgery, radiotherapy or chemotherapy have improved over time, they still come with serious and sometimes debilitating side effects. Their effectiveness also varies depending on the type and stage of the cancer.

Immunotherapy has revolutionised cancer treatment and is proving to be particularly useful in late stage and metastatic diseases where conventional therapies fail.

Professor Shafren saw the potential of immunotherapies for cancer care after an unexpected turn in his research.

While investigating ways to prevent the cold virus from binding to molecules in the lungs, nasal passage and respiratory tract, Professor Shafren was approached by a colleague trying to find new ways to kill melanoma cells in the laboratory setting. On a whim, he suggested using the airborne virus Coxsackievirus A21, one of the causes of the common cold. It obliterated the melanoma cells.

With the support of TUNRA (a wholly owned subsidiary of the University of Newcastle), Professor Shafren patented CAVATAK®, founded Viralytics and collaborated with a host of cancer institutes on clinical trials that demonstrated CAVATAK®’s effectiveness against melanoma, lung cancer and bladder cancer.

Professor Shafren’s new venture ImmVirX uses RNA viruses to target cells in other cancers, such as colorectal and ovarian cancer.

Based at the Hunter Medical Research Institute (HMRI) and supported by TUNRA, ImmVirX has captured the attention of venture capital and biopharma firms alike.

Research impact

ImmVirX

• ImmVirX has raised over $40 million across multiple investment rounds to support research and development into its pipeline of oncolytic RNA treatments.

In 2021 it raised over $22 million through a Series A investment round led by Melbourne’s Acorn Capital Investment.

Sydney-based venture capital firm OneVentures backed ImmVirX with a $15 million investment in 2023 – the same year it began a Phase 1a clinical trial of its oncolytic virus IVX037. The investment would enable ImmVirX to continue research and development activities through to 2026.

Other backers include Perennial Partners and Karst Peak Capital Partners.

• ImmVirX entered a partnership with Innovent Biologics in 2024 for a Phase 1b clinical trial to assess IVX037 alongside Innovent Bio’s anti-PD-1 therapy TYVYT®.

The trial focuses on bowel and gastroesophageal cancers that have spread to the liver, as well as advanced ovarian cancer. Early results are promising.

• The team is recruiting eligible patients at sites in Sydney, Melbourne and Adelaide.
• In 2025, ImmVirX received a $5.1 million boost through the Australian Government’s R&D tax incentive program.
• Twenty-four research and development staff have been employed to work on the ImmVirX venture, including several who were part of the Viralytics team.

CAVATAK®

• Pharmaceutical company MSD (a subsidiary of US-based Merck & Co., Inc.) acquired Viralytics and the rights to CAVATAK® for $502 million (AUD) in 2018.
• Professor Shafren’s work on CAVATAK® led to the creation of 35 jobs, including roughly 25 scientists who were involved in the research and development of the innovative cancer treatment.

Professor Darren Shafren

With Viralytics, we saw our research translate into real clinical benefits and that’s what we’re hoping to achieve again.