Redwood City, CA-based drugmaker Coherus BioSciences agreed to buy clinical-stage immuno-oncology (I-O) company Surface Oncology for $65 million in an all-stock transaction.

The company will buy all outstanding Surface Oncology shares at $5.2831 per share for approximately $40 million, along with anticipated net cash between $20 million and $25 million at closing, which is expected in the third quarter.

Coherus BioSciences will gain access to Surface Oncology’s two experimental cancer medicines in human testing.

“By augmenting Coherus’ existing capabilities and infrastructure with Surface’s innovative pipeline and deep I-O expertise, Coherus is well positioned to develop important I-O medicines for patients which deliver real value for the shareholders of both companies,” said Rob Ross, MD, President and Surface CEO.

Cambridge, MA-based Surface was founded in 2014, and a year later it had raised $35 million through a Series A financing round led by Atlas Venture, which had seeded the company, and participation from Fidelity Biosciences, the venture arms of Eli Lilly and Amgen, and the Novartis Institutes for Biomedical Research.

In the fall of 2020, there were rumors GSK was interested in buying Surface. The UK big pharma ended up signing a sizable agreement that December.

Surface also announced it will lay off around half of its workforce. The company had previously declared plans to lay off a fifth of its staff in November, and by the end of March reported in a filing that it had a total of 60 employees.