Oncolytics Biotech Inc. (NASDAQ: ONCY) announced that data published in the Proceedings of the National Academy of Sciences show its investigational drug pelareorep can shift an immunologically inactive liver cancer tumor microenvironment to an active state, potentially making tumors susceptible to immune-based therapies.

The paper, titled "MicroRNA-driven regulation of immunosuppressive microenvironment in hepatocellular carcinoma," was published on Sept. 28, 2026. The preclinical data show that pelareorep infection reversed several markers of immune suppression in hepatocellular carcinoma, including increases in PD-L1 expression, Inducible T cell Costimulatory Ligand levels on tumor cells, and CD8+ T cell density.

Hepatocellular carcinoma typically presents with low CD8+ T cell infiltration and high levels of immunosuppressive signaling factors, characteristics associated with poor response to immunotherapy. The observed changes suggest a shift from a "cold" to a "hot" tumor microenvironment, which the company says could enable checkpoint inhibitors and other therapies to function more effectively.

"This publication provides additional evidence that pelareorep alters the tumor microenvironment in traditionally challenging indications," said Thomas Heineman, MD, PhD, Chief Medical Officer of Oncolytics. "While liver cancer is not an indication we intend to pursue at this time, the data align with our narrative that pelareorep works in challenging tumor types."

Pelareorep is an intravenously delivered immunotherapy that has been administered to more than 1,200 patients. Oncolytics is currently advancing pelareorep in metastatic gastrointestinal cancers, where it has received Fast Track designation from the U.S. Food and Drug Administration for colorectal, anal, and pancreatic cancer.