Kazia Therapeutics Limited (NASDAQ: KZIA), an oncology-focused drug development company,  announced an exclusive collaboration and in-licensing agreement (the "Agreement") with QIMR Berghofer for a first-in-class PD-L1 degrader program. The lead optimized compound, NDL2, is an advanced PD-L1 protein degrader currently in development and represents a new and innovative frontier of cancer immunotherapy.

PD-L1 Degradation and NDL2

Cancer cells frequently express PD-L1 protein to evade immune attack. When PD-L1 on a tumor cell surface binds to PD-1 on a T cell, the T cell becomes inactivated and loses its ability to destroy the cancer. Traditional checkpoint inhibitors such as pembrolizumab (Keytruda®) and nivolumab (Opdivo®) use monoclonal antibodies to block this surface interaction, helping to restore T-cell activity.

However, research has shown that PD-L1 also exists in post-translationally modified forms that are enriched in patients who fail or relapse on checkpoint inhibitor therapy. These modified proteins are found on the cell surface as well as in the cytoplasm and nucleus, where they contribute to resistance and tumor progression.

NDL2 takes a fundamentally different approach. This novel bicyclic peptide degrader, discovered and developed by Professor Sudha Rao, is designed to specifically recognize and degrade these resistant, post-translationally modified forms of PD-L1. By binding PD-L1 and recruiting the cell's natural protein disposal machinery, NDL2 drives the breakdown and clearance of the modified PD-L1 across all cellular compartments. Targeting these resistant PD-L1 pools that antibody therapies cannot reach offers the potential to overcome immunotherapy resistance and restore durable immune activity against tumors.

We believe this comprehensive degradation strategy has the potential to offer two major clinical advantages: (1) Overcoming resistance in both primary non-responders and patients who relapse on antibody therapies, and (2) Providing durable immune reactivation by restoring cytotoxic T-cell function and reducing T-cell exhaustion in the tumor microenvironment.

NDL2 Preclinical Evidence

In preclinical models of aggressive triple-negative breast cancer (TNBC), NDL2 monotherapy, as well as in combination with anti-PD-1 therapies, achieved significant tumor growth reduction. Importantly, treated tumors showed reduced T-cell exhaustion and enhanced immune activity, consistent with NDL2's dual mechanism of action. Across the preclinical work to date, no toxicity has been observed. Professor Rao and QIMR Berghofer are working in parallel with a number of world-leading oncology peptide manufacturers to optimize the stability, potency, pharmacokinetics and pharmacodynamics of the NDL2 formulation.

Development Pathway and Combinations

The program will initially target advanced breast cancer and non-small cell lung cancer (NSCLC), where PD-1/PD-L1 immunotherapies are widely used but resistance remains common. IND-enabling studies are expected to commence within six months, with a goal of initiating first-in-human studies within approximately 15 months. Kazia also intends to explore synergistic opportunities to combine NDL2 with its existing pipeline assets, including paxalisib (a pan-PI3K/mTOR inhibitor) and EVT801 (a selective VEGFR3 inhibitor), given their complementary mechanisms of action in modulating the tumor microenvironment.

Dr. John Friend, Chief Executive Officer of Kazia Therapeutics, commented: "This Agreement positions Kazia at the forefront of next-generation immuno-oncology. NDL2 is a truly first-in-class asset, representing an advanced PD-L1 degrader, and what we believe one of the most exciting innovations in targeted protein degradation. This program complements our existing pipeline, with clear opportunities for synergy with other immunotherapies as well as paxalisib and EVT801, and we are positioned to rapidly advance it toward the clinic."

Professor Sudha Rao, Principal Investigator at QIMR Berghofer and inventor of the PD-L1 degrader program, added: "NDL2 has the potential to redefine immunotherapy by targeting all functional pools of PD-L1 protein, not just the surface expression blocked by current antibodies. By eliminating PD-L1 throughout the cell, we can address resistance and other pathways that drive aggressive cancers like TNBC and NSCLC. We are thrilled to partner with Kazia to potentially translate this novel science into a transformative therapy for patients."

Collaboration and Licensing Terms 

Under the terms of the collaboration Agreement, Kazia will make a one-time payment of approximately $1.39 million 15 business days after signing and is responsible for all development costs. Kazia will share a percentage of commercialization revenue, which includes any out-licensing payments received from third parties.