PDX Pharma has been awarded a phase II SBIR grant of $1.87M for 2 years from the National Cancer Institute (NCI) focusing on the development of a new nano-immunotherapy ARAC-02 (Antigen Release Agent and Checkpoint Inhibitor) for lung cancer treatment. ARAC-02 – nanoparticle co-delivering a PD-L1 antibody, a polo-like kinase 1 (PLK1) inhibitor, and an immune-stimulant CpG – provides effective antitumor immune response via CD8+ T cell activities. The original grant application of ARAC-02 had high merit and received a rare perfect score from the NIH. We met all phase I SBIR milestones on formulation optimization and initial efficacy and safety studies in cells and in mice, which leads to phase II SBIR grant awarded for ARAC-02’s evaluation in multiple lung cancer models. Many cancers including lung cancer depend on PLK1 for cell division and growth, and PLK1 inhibition by ARAC-02 will lead to cell death. After PLK1 inhibition, ARAC-02 transiently upregulates PD-L1 expression, rendering the cancer (which may originally have low PD-L1 expression and are not eligible for immune checkpoint inhibitors, ICIs) more sensitive to PD-L1 antibody serving as the ICI and cancer homing agent on ARAC-02. We also show that CpG on ARAC-02, which recruits and activates antigen-presenting cells, enhance CD8+ T cell population and activities. Our current data suggest that ARAC-02 will have broad efficacy in lung and other cancer types (e.g., breast, liver, and pancreatic cancer) regardless of mutational status. ARAC-02 is anticipated to reach clinical trials next year. Data on first gen ARAC (without CpG) was published in Nature Communications in 2022. A US patent (US11224573B2) on the ARAC technology was also issued in Jan, 2022.