After initiating a wind-down more than 18 months ago and exploring liquidation, Galera Therapeutics has found a path forward via a reverse merger with Obsidian Therapeutics that will take oncology-focused Obsidian public.
The companies unveiled the all-stock transaction, alongside a $350 million private placement, in an April 14 release. The placement is meant to fund the combined company through the second half of 2028.
Obsidian, aiming to advance tumor-infiltrating lymphocyte (TIL) cell therapies, will leap onto the public markets through the combination with Galera, while the combined biotech will support both companies’ pipelines.
The combined company will operate as Obsidian Therapeutics under the leadership of current CEO Madan Jagasia, M.D., and will apply to trade on Nasdaq under the ticker symbol “OBX.”
Obsidian’s lead candidate, OBX-115, is a genetically engineered TIL cell therapy currently in phase 2 for patients with advanced melanoma and in a phase 1 trial for patients with non-small cell lung cancer (NSCLC).
Cambridge-based Obsidian is in pursuit of unlocking the power of TILs, as researchers began finding therapeutic potential for them in patients with metastatic melanoma in the 1990s. But toxicity and limitations beyond melanoma have blunted their overall impact.
The financing includes new investors Balyasny Asset Management, Caligan Partners LP, Eventide Asset Management, Nantahala Capital, Octagon Capital, Redmile, Spruce Street Capital and Trails Edge Capital Partners, as well as participation from existing Obsidian investors Atlas Venture, Deep Track Capital, Foresite Capital, Novo Holdings A/S, BioCapital Advisors, RA Capital Management and Wellington Management, among others.
The funding aims to support the NSCLC trial for OBX-115, which is anticipated to conclude in the first half of 2027. The company also expects to present topline data from the melanoma trial by year-end. OBX-115 has received fast track and regenerative medicine advanced therapy designations from the FDA for patients with unresectable or metastatic melanoma resistant to immune checkpoint inhibitors.
“We believe OBX-115 offers an opportunity to provide patients with an improved TIL product and patient experience,” Jagasia said in the release.
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The combined company will also support Galera’s pipeline, which includes candidates advancing a pan-NOS inhibitor for patients with advanced breast cancer. Galera began exploring strategic alternatives in 2023 after the FDA rejected its radiotherapy complication drug, determining that phase 3 results for its selective dismutase mimetic, avasopasem, were insufficient to reduce severe oral mucositis in patients with head and neck cancer.
Galera subsequently cut 70% of its staff and halted all clinical trial activity while seeking strategic alternatives. Obsidian has now stepped in to provide that path forward.
Galera stockholders are expected to own approximately 1.8% of the combined company, while pre-closing Obsidian stockholders will own about 53.2%. Investors in the private placement are expected to hold approximately 45.0%.
