Catabasis Pharmaceuticals Acquires Quellis Biosciences and Raises $110 Million in Private Offering

Rare Daily Staff

Rare disease focused biotech Catabasis Pharmaceuticals said it has acquired Quellis Biosciences, a privately-held emerging biotech focused on discovering best-in-class new molecules to treat serious rare diseases.

Concurrent with the acquisition of Quellis, Catabasis entered into a definitive agreement for the sale of series X convertible preferred stock in a private placement to a group of institutional accredited investors that is expected to result in gross proceeds to Catabasis of approximately $110 million before deducting placement agent and other offering expenses.

Quellis was formed at Xontogeny, a life sciences accelerator, with the founders of Quellis and a seed investment in 2017. The subsequent series A financing was led by the Perceptive Xontogeny Ventures (PXV) Fund in 2018 with Fairmount Funds. The PXV Fund participated in the private placement as part of the Perceptive Advisors investment.

Catabasis expects to use the proceeds from the private placement primarily to enable the completion of IND-enabling studies, and early stage clinical trials for Quellis’ lead program QLS-215 in hereditary angioedema (HAE), a rare, debilitating, and life-threatening genetic condition.

Symptoms of HAE include episodes of debilitating and often painful swelling in the hands, feet, face (lips and tongue), gastrointestinal tract, and the urogenital region or airways. Attacks are unpredictable in frequency, location, timing, and severity, with multiple types of triggers.

The vision for the lead program, QLS-215, is to develop the best-in-class monoclonal antibody inhibitor of plasma kallikrein for HAE with infrequent dosing and sustained blood levels. QLS-215 is a humanized monoclonal antibody targeting plasma kallikrein that has demonstrated potent inhibition of plasma kallikrein as well as extended plasma half-life in non-human primates.

Catabasis expects to file an Investigational New Drug application for QLS-215 in the first half of 2022 and plans to initiate a phase 1 clinical trial with initial results anticipated by the end of 2022. Subsequently, Catabasis expects to initiate a phase 1b/2 trial in patients affected by HAE in 2023 with initial results anticipated by the end of 2023.

“We are thrilled that the Catabasis Board and management team selected Quellis as the best acquisition opportunity based on our lead asset, QLS-215, and the vision to produce a leading HAE and rare disease company,” said Chris Garabedian, chair of the Quellis Board of Directors, CEO of Xontogeny and portfolio manager, Perceptive Xontogeny Ventures (a Perceptive Advisors fund).

The acquisition of Quellis was structured as a stock-for-stock transaction whereby all outstanding equity interests of Quellis were exchanged in a merger for a combination of shares of Catabasis common stock and shares of Series X Preferred Stock. Concurrently with the acquisition of Quellis, Catabasis entered into definitive agreements for a PIPE investment with existing and new investors to raise approximately $110 million in which the investors will be issued shares of Series X Preferred Stock at a price of approximately $3,093 per share (or, $3.09 per share on an as-converted-to-common basis).

The Board of Directors of Catabasis and the stockholders of Quellis approved the acquisition.

Photo: Chris Garabedian, CEO of Xontogeny