Talaris, Tourmaline to combine in biotech’s latest reverse merger

22 Jun 2023
www.biopharmadive.com
Cell TherapyPhase 2AcquisitionExecutive ChangeImmunotherapy
Dive Brief:
Tourmaline Bio, a private company focused on immune diseases, agreed to an all-stock merger with the struggling cell therapy company Talaris Therapeutics.
Talaris stockholders will receive about $3.43 a share in the transaction and a cash dividend of some $65 million from Talaris before the merger, the two companies said Thursday. They expect Talaris investors to end up with ownership of 21.3% of the combined company.
The new company will have about $210 million in cash to focus on advancing a drug in Phase 2 studies for thyroid eye disease as well as atherosclerotic cardiovascular disease. The company will be known as Tourmaline Bio and trade under the ticker TRML, with an expected close in the fourth quarter of this year.
Dive Insight:
Founded in 2002, Talaris had the lofty goal of developing a cell therapy that would allow patients to receive an organ transplant from any donor without needing a lifetime of immune-suppressing drugs to avoid organ rejection. The idea showed early promise, but safety issues emerged in later testing.
In February, Talaris announced it was giving up on development of the medicine for kidney transplant patients and undergoing a corporate restructuring that included slashing a third of its workforce. It planned to continue just one human study, a Phase 2 trial for patients with the autoimmune disease scleroderma, while considering options such as a merger or a sale of manufacturing capabilities.
For Tourmaline, the deal offers a path to go public without having to navigate a tricky market for initial public offerings. With funding for biotechnology companies hard to come by, a number of smaller companies have chosen to join forces in recent months, including Magenta Therapeutics and Dianthus Therapeutics, Carisma Therapeutics and Sesen Bio, Elicio Therapeutics and Angion Biomedica, and Enliven Therapeutics and Imara.
Tourmaline, with a mid-stage asset in the antibody drug TOUR006, has had success with private rounds of funding. The company completed a $112 million Series A financing this year and entered an agreement for a $75 million private placement to support the merger.
The new company will be led by Tourmaline executives, including CEO Sandeep Kulkarni. Five of the seven board members will be named by Tourmaline, with the remaining two appointed by Talaris.
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