Australian biotechnology company Arovella Therapeutics has announced plans to raise around A$12.5m ($8.1m) to begin Phase I clinical trials of its drug candidate ALA-101.

ALA-101 is an invariant Natural Killer T (iNKT) cell therapy indicated for the treatment of CD19-positive non-Hodgkin’s lymphoma.

The company has received firm commitments from both new and current investors, who have subscribed to 125 million new, fully paid ordinary shares.

The shares have been placed at A$0.10 each, accompanied by a 1-for-1 option exercisable at A$0.15 over three years.

The capital injection will enable Arovella to progress ALA-101, its lead product, into Phase I trials and collect preliminary data from patients who receive the treatment.

It will also be used to expand the company's iNKT cell therapy pipeline and further the development of solid tumour treatments while providing general working capital.

Over the next year, Arovella expects to reach several key milestones, including scaling up the CAR-iNKT manufacturing process for ALA-101.

These milestones also include manufacturing of ALA-101 intended for clinical trials and concluding the non-clinical safety and efficacy studies required for filing investigational new drug (IND) applications.

Arovella also plans to obtain regulatory approval for a Phase I trial of the cell therapy.

Arovella chairman Dr Thomas Duthy said: “This is a pivotal time for Arovella, which continues to be a global pioneer in developing CAR-iNKT cell therapeutics.

“The level of support for the placement from well-known, global institutional investors highlights the potential of our highly differentiated cell therapy platform and our significant progress to date.

“It provides us with the capital to execute our goals, notably to assess the clinical benefit of our proprietary CAR-iNKT cells in cancer patients.”

Last October, Arovella and SparX Group partnered to develop a chimeric antigen receptor iNKT (CAR-iNKT) cell therapy to treat solid tumours.