Talaris Therapeutics Inc. (Nasdaq: TALS) intends to merge with a late-stage clinical biotechnology company.
The Boston-based biotech firm announced its definitive agreement to merge with Tourmaline Bio Inc. The news comes just over a month after Talaris announced its plans to close its Louisville facilities, a move that will result in 51 layoffs, following the discontinuation of two of its clinical trials.
The combined company will operate under the name Tourmaline Bio Inc. and trade on the Nasdaq under the ticker symbol “TRML.” In addition, Talaris anticipates making a cash dividend of up to about $64.8 million to its stockholders prior to the closing of the deal, according to a news release.
The company will focus on advancing Tourmaline’s lead program, TOUR006, an anti-IL-6 antibody, for the treatment of thyroid eye disease (TED) and atherosclerotic cardiovascular disease (ASCVD).
“The Talaris Board of Directors conducted a review of strategic alternatives to identify paths to provide value to our stockholders. We believe the transaction we are announcing today with Tourmaline, together with the expected cash dividend of up to approximately $64.8 million, presents a compelling opportunity for our shareholders,” said Mary Kay Fenton, interim CEO of Talaris, in the release. “TOUR006 is a promising clinical asset with near-term, value-creating milestone opportunities. We look forward to its future success.”
As Louisville Business First previously reported, Talaris, founded in Louisville as Regenerex LLC more than two decades ago, was among the best-funded startups in Kentucky, raising $215 million. It aimed to develop a process for organ transplant recipients to not spend the rest of their lives taking potentially toxic immunosuppressant drugs.
In support of the merger, Tourmaline has entered into an agreement for a $75 million private placement with a syndicate of new and existing institutional life sciences investors including Acuta Capital Partners, Affinity Asset Advisors, Braidwell LP, Cowen Healthcare Investments, Deep Track Capital, Great Point Partners, LLC, KVP Capital, Logos Capital, Paradigm BioCapital, Qiming Venture Partners USA, RA Capital Management, LP, StemPoint Capital LP, TCGX, Vivo Capital and other undisclosed investors.
Tourmaline previously completed a $112 million Series A round in 2023 that was co-led by Deep Track Capital, Cowen Healthcare Investments and TCGX, the release said. Tourmaline was founded in September 2021 and initially financed in May 2022 by Hydra, KVP Capital, Petrichor and QVT Family Office.
“We are thrilled to be entering into this transaction with Talaris,” said Sandeep Kulkarni, MD, CEO of Tourmaline, in the release. “We have assembled a world-class team with deep experience developing antibodies for immune disorders and are now on the verge of beginning our Phase 2 development campaign in multiple indications.
"We believe that TOUR006 has best-in-class potential and could be a transformative treatment option for millions of patients suffering from immune disorders. This merger and the support from leading life sciences investors will allow us to accelerate our development plans in TED, heart disease, and potentially other indications.”
Tourmaline stockholders immediately prior to the merger are expected to own approximately 78.7% of the combined company and Talaris stockholders are expected to own approximately 21.3% of the combined company, each on a fully diluted basis. That may change based on Talaris' net cash at closing.
As I reported last month, Talaris had $181.3 million in assets as of Dec. 31. Its share price was $2.70 at close on Thursday, up nearly 23% from its previous closing price.
