Executive Summary / Key Takeaways

• Aura Biosciences is a clinical-stage biotechnology company focused on developing precision therapies for solid tumors using its proprietary Virus-Like Drug Conjugate (VDC) platform, aiming to preserve organ function.
• The lead candidate, bel-sar, is advancing in a global Phase 3 trial for early-stage choroidal melanoma, with enrollment potentially completing by year-end 2025, and has shown promising Phase 2 data including an 80% tumor control rate and 90% visual acuity preservation in Phase 3-eligible patients.
• The company is strategically expanding bel-sar development into other high-unmet-need areas like metastases to the choroid and non-muscle invasive bladder cancer (NMIBC), with positive Phase 1 NMIBC data supporting advancement and initial Phase 1b/2 data expected by year-end 2025.
• AURA's VDC technology offers tangible benefits, including precise tumor targeting via selective binding to tumor-associated glycosaminoglycans and a dual mechanism of action combining acute necrosis with immune activation, differentiating it from broader oncology approaches.
• Financially, AURA reported a net loss of $27.5 million in Q1 2025, driven by increased R&D for clinical trials and manufacturing; the company estimates its $128.0 million in cash and marketable securities as of March 31, 2025, will fund operations into the second half of 2026, but substantial additional funding will be required for later-stage development and commercialization.

Aura Biosciences is carving out a unique niche in the competitive oncology landscape with its innovative Virus-Like Drug Conjugate (VDC) platform. Founded in 2009, the company's mission centers on developing precision therapies for solid tumors designed not only to eliminate cancer but also to preserve vital organ function – a critical unmet need in many cancer types. This strategic focus positions AURA in areas like ocular and urologic oncology, where current standards of care often involve highly invasive procedures leading to significant functional loss.

The cornerstone of AURA's approach is its proprietary VDC technology. This platform utilizes modified capsid proteins from the human papilloma virus (HPV) as a delivery vehicle. These Virus-Like Particles (VLPs) are engineered to selectively bind to a specific subset of modified tumor-associated glycosaminoglycans (GAGs) expressed on the surface of cancer cells. This selective binding is a key differentiator, enabling targeted delivery of a cytotoxic payload directly to the tumor while minimizing exposure to surrounding healthy tissues.

Once delivered, the VDCs, like AURA's lead candidate belzupacap sarotalocan (bel-sar), are activated by light. This light activation triggers a dual mechanism of action. First, it generates acute necrosis, directly killing tumor cells through the release of the cytotoxic payload. Second, this acute cell death is designed to trigger an immunogenic response, activating the patient's immune system to mount a secondary, adaptive, and potentially long-lasting antitumor response. The technology is designed for multiple light activations following a single dose, enhancing antitumor activity due to tumor reoxygenation and the photostability of bel-sar. This combination of targeted delivery, direct cell killing, and immune activation represents a novel approach with the potential for improved efficacy and safety profiles compared to traditional systemic chemotherapies or broad-field radiation.

AURA's lead program, bel-sar, exemplifies this approach. It is currently in late-stage clinical development for the first-line treatment of adult patients with small choroidal melanoma and indeterminate lesions, collectively referred to as early-stage choroidal melanoma. This is a rare and life-threatening ocular cancer where current treatments like plaque brachytherapy or proton beam therapy are highly invasive and frequently result in significant vision loss or even legal blindness. Enucleation, the surgical removal of the eye, is another option, resulting in complete vision loss. The significant unmet need for a vision-preserving therapy in this indication is a core driver for AURA.

The company is evaluating bel-sar in a global Phase 3 CoMpass trial. Based on company expectations, enrollment for this pivotal trial may be completed as early as the end of 2025. This follows promising data from a Phase 2 study (NCT04417530) in early-stage choroidal melanoma. In that study, among Phase 3-eligible patients who received the therapeutic regimen (n=10), bel-sar achieved an 80% tumor control rate. Crucially, visual acuity was preserved in 90% of these patients, 80% of whom had tumors at high risk for vision loss due to proximity to the fovea or optic disc. The study also demonstrated a significant reduction in tumor growth rate among responders post-treatment (0.01 mm/yr) compared to the rate prior to study entry (0.35 mm/yr, p<0.0001). The safety profile observed in the Phase 2 study was also favorable.

Building on the potential of bel-sar, AURA is strategically expanding its clinical development into other indications where the VDC platform's targeted and organ-preserving potential could address significant unmet needs. This includes metastases to the choroid, for which a Phase 2 trial has been initiated. The company is broadening the inclusion criteria for this trial to a basket study approach, encompassing metastases from various solid tumors, with initial data anticipated in 2025.

Furthermore, AURA is advancing bel-sar in bladder cancer, specifically non-muscle invasive bladder cancer (NMIBC). NMIBC is the ninth most common cancer globally, with a high risk of recurrence and progression despite current standard of care treatments. In March 2025, AURA announced positive data from a completed Phase 1 window of opportunity trial (NCT05483868) in NMIBC patients. The data from patients receiving bel-sar with light activation (n=10) showed clinical activity as early as 7 days post-treatment. In intermediate-risk patients (n=5), 4 out of 5 target lesions demonstrated a clinical complete response (absence of tumor cells on histopathology). In high-risk patients (n=5), 1 out of 5 had a clinical complete response, and 3 out of 5 showed visual tumor shrinkage. Importantly, the data also provided evidence of a bladder urothelial field effect and immune activation, with clinical complete responses observed in non-target tumors (4/7 patients with multiple tumors) alongside infiltration of effector T-cells and formation of tertiary lymphoid structures. This suggests bel-sar's dual mechanism may induce local active immunosurveillance. Based on these positive results, AURA is advancing bel-sar into an ongoing Phase 1b/2 trial in NMIBC, evaluating additional doses and cycles with initial 3-month data expected by year-end 2025. The company also plans to initiate a Phase 1 trial in cancers of the ocular surface in 2025.

The competitive landscape in oncology is intense, featuring large multinational pharmaceutical companies like Regeneron (REGN), Novartis (NVS), and Roche (RHHBY), as well as specialized biotechnology firms such as Immunocore (IMCR) and companies focused on specific cancer types like those in NMIBC (e.g., Johnson & Johnson (JNJ), UroGen Pharma Ltd. (URGN), CG Oncology, Inc. (CGON), ImmunityBio, Inc. (IBRX), Ferring Pharmaceuticals). While larger players like REGN, NVS, and RHHBY possess significantly greater financial resources, established market presence, and diversified pipelines, AURA aims to compete through the differentiated mechanism and targeted nature of its VDC platform.

Compared to the broader oncology portfolios of companies like REGN, NVS, and RHHBY, AURA's VDC technology offers potentially greater precision in tumor targeting and a distinct dual mechanism of action. While direct, quantifiable comparisons of market share in AURA's specific niche indications are challenging to ascertain for all competitors, AURA's focus on high-unmet-need areas with a potentially vision-sparing approach in ocular oncology and a novel front-line approach in NMIBC positions it differently from competitors whose products may have broader indications or different mechanisms. For instance, in NMIBC, while several companies have drugs in development, AURA's Phase 1 data suggesting a urothelial field effect and immune activation with a favorable safety profile presents a potentially differentiated profile compared to existing or pipeline therapies. However, AURA faces competitive disadvantages related to its smaller scale, higher per-unit manufacturing costs in early stages, and the need to build commercial infrastructure compared to the established capabilities of large pharmaceutical companies. Indirect competitors, such as surgical interventions or less targeted therapies, also pose a threat, particularly on cost, though they may lack the precision and organ-preserving potential of AURA's approach.

Financially, AURA is in the typical cash-intensive stage of clinical development for a biotechnology company. The company has not generated any revenue to date and has incurred significant net losses since inception, with an accumulated deficit of $401.7 million as of March 31, 2025.

For the three months ended March 31, 2025, the net loss was $27.5 million, an increase from $19.7 million for the same period in 2024. This increase was primarily driven by higher operating expenses, which rose from $22.3 million in Q1 2024 to $29.0 million in Q1 2025. Research and development expenses accounted for the largest portion of this increase, rising from $17.1 million to $23.3 million, reflecting the costs associated with the ongoing global Phase 3 trial for bel-sar, as well as manufacturing and development activities. General and administrative expenses also increased, from $5.3 million to $5.7 million, mainly due to higher personnel costs supporting company growth.

As of March 31, 2025, AURA held $128.0 million in cash and cash equivalents and marketable securities. The company estimates that these resources will be sufficient to fund its operating expenses and capital expenditure requirements into the second half of 2026. However, advancing bel-sar through regulatory approval and potential commercialization, as well as progressing other pipeline candidates, will require substantial additional funding. The company has historically relied on equity financings, raising approximately $420 million in gross proceeds through March 31, 2025, including significant follow-on offerings in late 2022 and 2023. A subsequent event on May 15, 2025, saw the company announce the pricing of a public offering of common stock and warrants, indicating ongoing efforts to strengthen its balance sheet. The ability to raise future capital on favorable terms will be critical and could be influenced by market conditions and clinical trial outcomes. Reliance on third-party CDMOs for manufacturing also presents operational risks related to supply, quality control, and cost.

Key risks for investors include the inherent uncertainties of clinical trials, potential delays or failures in obtaining regulatory approvals (particularly given the complexity of a biologic-device combination like bel-sar), challenges in patient enrollment for rare diseases, reliance on third-party manufacturers and CROs, the need for significant additional funding, potential market acceptance challenges if approved, and intense competition from companies with greater resources. The company's estimate of its cash runway is based on assumptions that could prove incorrect, potentially requiring earlier-than-expected financing.

Conclusion

Aura Biosciences presents an investment thesis centered on its differentiated VDC platform and the potential of its lead candidate, bel-sar, to address high-unmet-need solid tumors while preserving organ function. The company has demonstrated promising clinical activity with bel-sar in early-stage choroidal melanoma, advancing to a pivotal Phase 3 trial, and is strategically expanding into other indications like NMIBC based on encouraging early data. The unique mechanism of action and targeted delivery offered by the VDC technology provide a potential competitive advantage against existing therapies and rivals. While the company faces significant financial requirements typical of a clinical-stage biotech, necessitating future capital raises, and operates in a highly competitive environment, progress in the ongoing and planned clinical trials, particularly the Phase 3 data readout for choroidal melanoma and initial data from the NMIBC trial, represent critical milestones that could validate the platform and unlock significant value. Investors should closely monitor clinical trial execution, regulatory progress, and the company's ability to secure necessary funding to support its ambitious development plans.