TwoStep Raises US$62.5M to Send a Peptide Where Antibodies Can't Reach
TwoStep Therapeutics, a clinical-stage oncology company based in San Carlos, California, said on September 10, 2026 that it had closed an oversubscribed US$62.5 million Series A and received FDA clearance of its investigational new drug application for TS-104, its lead candidate. The round was led by Insight Partners and Medical Excellence Capital and co-led by M Ventures, the venture arm of Merck KGaA, and Pfizer Ventures, with participation from existing backers NFX and 2048 Ventures and from Stanford University. Total capital raised to date reaches US$71.2 million, up from a US$6.5 million seed led by NFX. The company is run by co-founder and Chief Executive Officer Caitlyn Miller, PhD, and was founded in 2024 out of Stanford's Innovative Medicines Accelerator alongside three Stanford faculty co-founders: bioengineering professor Jennifer Cochran, PhD, oncologist Ronald Levy, MD, and Carolyn Bertozzi, PhD, who shared the 2022 Nobel Prize in Chemistry.
TS-104 is a peptide-drug conjugate, a smaller cousin of the antibody-drug conjugates that now dominate oncology dealmaking. Instead of an antibody, it uses an engineered polyspecific integrin-binding peptide, or PIP, from the knottin family of highly stable, disulfide-locked peptides. The peptide binds five tumor-associated integrins at once, and only in their active, open conformation, which the company says concentrates the drug on cancer cells rather than healthy tissue. The payload is monomethyl auristatin E, the same cytotoxic agent used in several approved ADCs. With the IND cleared, TwoStep expects to begin a first-in-human Phase 1 study with patient enrollment starting later in 2026. Four new directors joined the board from the investor syndicate: Matias Porras Paniagua of Insight Partners, John Prufeta of Medical Excellence Capital, Oliver Lyth of M Ventures and Rana Al-Hallaq of Pfizer Ventures, alongside Omri Amirav-Drory of NFX and Miller. A second track applies the same peptide to radioligand therapy.
Market Context
Targeted cytotoxics are the hottest category in cancer drug development, and the sales figures explain why. Six antibody-drug conjugates cleared US$1 billion in 2025: AstraZeneca and Daiichi Sankyo's Enhertu came close to US$5 billion at roughly US$4.98 billion, Pfizer and Astellas' Padcev totaled about US$3.34 billion across both partners, Roche's Kadcyla reached US$2.33 billion and Gilead's Trodelvy US$1.40 billion. That success has also exposed the format's limits. Antibodies are large molecules that penetrate dense solid tumors slowly, circulate for weeks, and depend on a single target being expressed uniformly across a patient's tumor, which it rarely is.
The peptide pitch is the inverse trade-off. A knottin peptide is a fraction of the size of an antibody, which improves tumor penetration, clears faster from the body, and is cheaper to manufacture through chemical synthesis rather than cell culture. Binding five integrins at once is a hedge against the target-expression problem that has sunk multiple ADC programs. The bet is not unique to TwoStep: Novartis has an integrin-targeting radioligand therapy in Phase 1 and Pfizer has pursued integrin-directed solid tumor work of its own, which makes Pfizer Ventures' presence in the round both a validation and a reminder of who else is looking at the same biology. Two large pharmaceutical venture arms co-leading a Series A also reflects where early oncology money is coming from in 2026, with strategic investors taking positions that generalist crossover funds have grown more reluctant to price.
What Stands Out
"TwoStep is addressing one of the central challenges in solid-tumor drug development: identifying a targeting approach that can reach meaningful numbers of patients without relying on a single, uniformly expressed tumor target." — Matias Porras Paniagua, PhD, Vice President, Insight Partners
Regional Relevance
For the United States, this is a wager on a format shift inside the country's most valuable drug category. American and Japanese companies own most of the ADC franchises now generating billions, and the next competitive question is whether the delivery vehicle itself can be redesigned to reach tumors the current generation misses. TS-104 answers that with chemistry rather than biology: a synthetic peptide instead of a manufactured antibody, which changes the cost structure of goods sold as much as it changes the pharmacology. If it works in the clinic, the read-through extends across the roughly two dozen approved and hundreds of experimental conjugates that all share the same antibody backbone.
It also shows how US academic research still converts into companies. TwoStep exists because Stanford's Innovative Medicines Accelerator packaged faculty science into a startup with a first-time chief executive, and the university took equity in the Series A rather than simply licensing the patents. That model, in which a research institution sits on the cap table beside Insight Partners and two pharmaceutical venture arms, is how the Bay Area has repeatedly turned laboratory chemistry into clinical assets, and it is a route that depends on federal research funding staying stable upstream.
For California specifically, the round is a modest counterweight to a difficult stretch for the state's biotech employment. Series A rounds of this size in the Bay Area have become scarcer and more concentrated, and the ones that close now tend to carry a clinical trigger such as an IND clearance rather than platform promise alone. TwoStep's structure, with strategic pharmaceutical money in early, is a preview of how many of the state's next clinical-stage companies will be financed.
The Other Side
Does smaller actually mean better? Peptides penetrate tumors more easily, but they also clear the bloodstream in hours instead of weeks, which means less total drug exposure at the tumor. The entire premise of the ADC format is that a long-circulating antibody keeps delivering payload over days. TwoStep is trading residence time for access, and no peptide-drug conjugate has yet proven that trade wins in a solid tumor. That question only gets answered in patients.
Is targeting five integrins a feature or a safety problem? Binding several targets widens the eligible patient population, but integrins are not exclusive to tumors. The company's answer is conformation selectivity, meaning the peptide recognizes only the activated form found on cancer cells. In preclinical models that distinction holds; in humans, off-tumor uptake by healthy tissue expressing the same receptors is the risk that would show up first as dose-limiting toxicity with an MMAE payload.
What happens if a strategic investor becomes a competitor? Pfizer Ventures and M Ventures co-led the round and both parent companies have interests in the same target space. That is a well-worn path to an eventual acquisition or licensing deal, and it is also a structural tension: two of TwoStep's largest backers can develop competing assets internally. A single Phase 1 asset, US$71.2 million raised in total, and a first-time chief executive leave little cushion if the syndicate's priorities diverge before data arrives.
