Dive Brief:
- Freenome said Friday it plans to go public in a deal that could generate $330 million to develop and commercialize blood-based cancer detection tests.
- The company has agreed to merge with a special purpose acquisition company, bypassing the traditional initial public offering route to public markets, and secured funding from backers including Perceptive Advisors and RA Capital.
- Freenome, which has recently struck commercialization deals with Exact Sciences and Roche, is aiming to launch its first-generation colorectal cancer in vitro diagnostic screening test in 2026.
Dive Insight:
Freenome raised $270 million in 2020 and $254 million in 2024. The company used the funding to create and validate a colorectal cancer screening product that could compete with Guardant Health’s Shield test. Guardant has a head start, having won Food and Drug Administration approval for Shield in 2024, but Freenome has claimed its product could have best-in-class performance among blood-based tests.
Exact Sciences, which sells the stool screening test Cologuard, will commercialize Freenome’s colorectal cancer test in the U.S. Freenome expects version one of its SimpleScreen test to win FDA approval and secure coverage from the Centers for Medicare and Medicaid Services in 2026.
Data presented by Freenome suggest version one of SimpleScreen is roughly as good at detecting cancer at various stages as the as-yet-unapproved version two of Guardant’s Shield. Cross-trial comparisons can be misleading, but the available data suggest version two of SimpleScreen may be more sensitive than either Shield test. Freenome aims to launch SimpleScreen version two in 2027.
The company has identified colorectal cancer as the largest screening population, but its plans extend beyond the tumor type. Freenome plans to launch a laboratory developed test version of its lung screening product next year. The launch of a multi-cancer detection LDT is scheduled for around the end of next year.
Freenome plans to use the public listing money to expand its business and data infrastructure to support the launches. The SPAC has $90 million, but the amount Freenome receives may be lower if any investors choose to redeem their money. Freenome is set to receive $240 million in a financing round led by Perceptive Advisors and RA Capital. Bain Capital Life Sciences participated in the round.
The Freenome products will enter a competitive market. Guardant already sells a blood-based colorectal screening test. Grail is preparing to seek FDA approval for its multi-cancer early detection test. Abbott has struck a $21 billion deal to buy Exact Sciences, which, as well as partnering with Freenome in colorectal cancer, sells the blood-based multi-cancer detection product Cancerguard.
