Xilio Therapeutics accelerates cancer immunotherapy with new masked T cell engager programs and $52m AbbVie collaboration

Xilio Therapeutics, Inc., a clinical-stage biotechnology company based in Waltham, Massachusetts, has announced the development of three new masked T cell engager programs designed to enhance cancer immunotherapy. This milestone coincides with the company’s strategic collaboration with pharmaceutical giant AbbVie, under which Xilio will receive $52 million in upfront payments. The partnership is expected to accelerate the development of novel tumour-activated immunotherapies, extending Xilio’s financial runway into the first quarter of 2026.

The collaboration not only brings financial backing but also merges Xilio’s proprietary tumour-activation technology with AbbVie’s extensive oncology expertise. This combination could significantly advance cancer treatment options, particularly for solid tumours that have historically been difficult to target effectively due to toxicity limitations associated with existing therapies.

What makes masked T cell engagers a breakthrough in cancer immunotherapy?

T cell engagers have been a promising class of cancer immunotherapies, known for their ability to redirect the body’s immune system to attack cancer cells. These therapies work by binding simultaneously to tumour-associated antigens on cancer cells and T cell receptors, triggering a potent immune response that destroys the targeted tumour cells. However, despite their potential, traditional T cell engagers have faced significant challenges, primarily due to systemic toxicity and off-target effects, which can limit their therapeutic window.

Xilio Therapeutics aims to overcome these barriers with its masked T cell engagers. Unlike conventional T cell engagers, these innovative therapies are designed with a “masking” feature that keeps them inactive until they reach the tumour microenvironment. This approach reduces the risk of damaging healthy tissues and minimises adverse side effects, addressing a major limitation in current immunotherapy treatments.

René Russo, Pharm.D., president and chief executive officer of Xilio Therapeutics, emphasised the transformative potential of this approach. She noted that while traditional T cell engagers have shown clinical efficacy, their application in solid tumours has been limited due to toxicity. Russo explained that leveraging Xilio’s clinically validated masking technology could improve tolerability through tumour-selective activation, potentially leading the next wave of innovation in cancer immunotherapy.

How will the collaboration with AbbVie impact Xilio’s immunotherapy pipeline?

The partnership with AbbVie is a pivotal development for Xilio Therapeutics, both financially and strategically. Under the terms of the agreement, Xilio will receive $52 million upfront, which includes $42 million in cash and a $10 million equity investment from AbbVie at a premium. Beyond the initial funding, Xilio is eligible for up to $2.1 billion in additional payments tied to development, regulatory, and sales-based milestones. The company will also receive tiered royalties on global net sales of any licensed products developed through this collaboration.

AbbVie has secured an exclusive option to develop up to three masked cell engager programs and an exclusive license for a masked antibody-based immunotherapy program. This agreement allows both companies to combine their strengths—Xilio’s tumour-activation platform and AbbVie’s deep expertise in oncology drug development.

Theodora S. Ross, M.D., Ph.D., vice president of early oncology research and development at AbbVie, expressed optimism about the partnership, highlighting AbbVie’s commitment to expanding its oncology research portfolio. She stated that the collaboration with Xilio exemplifies AbbVie’s dedication to investigating novel immunotherapy approaches that could offer improved cancer treatments for patients. Uli Bialucha, Ph.D., chief scientific officer of Xilio Therapeutics, echoed this sentiment, adding that the collaboration will accelerate the development of next-generation immunotherapies. Bialucha highlighted the synergy between AbbVie’s global oncology leadership and Xilio’s deep protein engineering expertise, noting that this partnership would help advance innovative therapies designed for tumour-selective activation.

What are Xilio’s key masked T cell engager programs and their targets?

Xilio Therapeutics is advancing three wholly-owned preclinical programs focused on masked T cell engagers, each targeting specific tumour-associated antigens. The first program targets prostate-specific membrane antigen (PSMA), which shows strong potential in treating prostate cancer. Xilio plans to nominate a development candidate for its PSMA program in the third quarter of 2025 and submit an investigational new drug (IND) application in the first quarter of 2027. The second program targets claudin 18.2 (CLDN18.2), a promising antigen for gastric, pancreatic, oesophageal, and lung cancers. Xilio anticipates nominating a development candidate for its CLDN18.2 program by the end of 2025, with an IND submission planned for the second quarter of 2027. The third program focuses on six-transmembrane epithelial antigen of prostate 1 (STEAP1), which has broad potential in prostate, colorectal, and lung cancers. Xilio expects to nominate a development candidate for STEAP1 in the first half of 2026, with an IND filing targeted for late 2027.

These programs are built on Xilio’s proprietary tumour-activation platform, which introduces innovative formats such as the tumour-activated cell engager (ATACR) and the selective effector-enhanced cell engager (SEECR). The ATACR format features bispecific molecules with masked CD3 targeting domains, designed to remain inactive until they reach the tumour site, thereby reducing systemic toxicity. The SEECR format enhances this approach by incorporating co-stimulatory signalling, which amplifies T cell activation and persistence, further increasing the efficacy of the therapy.

What does the future hold for Xilio Therapeutics and its cancer immunotherapy pipeline?

Financially, the collaboration with AbbVie significantly strengthens Xilio’s position. The upfront payments, combined with the company’s existing cash reserves, are expected to support operations through the first quarter of 2026. This extended runway provides Xilio Therapeutics with the resources needed to advance its preclinical programs towards clinical development and regulatory milestones.

However, achieving key objectives beyond this period will require securing additional capital. Xilio acknowledges that continued progress in its masked T cell engager programs, including clinical trials and regulatory submissions, will depend on future funding opportunities. The company’s strategic focus will remain on expanding its oncology pipeline, pursuing regulatory approvals, and exploring additional partnerships that can support the development of its tumour-activated immunotherapies.

The biotechnology sector will be closely monitoring Xilio’s advancements as the company strives to push the boundaries of cancer immunotherapy. If successful, Xilio’s tumour-activated immunotherapies could offer new hope to patients with hard-to-treat cancers, potentially transforming the landscape of oncology treatment. The partnership with AbbVie, a leader in oncology drug development, underscores the growing recognition of Xilio’s innovative approach and its potential to redefine the future of cancer therapy.