Selecta Merges with Cartesian, raises $60 million
November 13, 2023
Rare Daily Staff
Selecta Biosciences said that it has merged with Cartesian Therapeutics, a clinical-stage biotechnology company developing RNA cell therapies for autoimmune diseases and raised $60 million in a private financing.
Timothy Springer, a member of the Selecta board, led the financing.
The merger was structured as a stock-for-stock transaction pursuant to which all of Cartesian’s outstanding equity interests were exchanged based on a fixed exchange ratio for consideration as a combination of approximately 6.7 million shares of Selecta common stock and approximately 0.38 million shares of Selecta series A Non-Voting Convertible Preferred Stock (or approximately 385 million shares on an as-converted-to-common basis).
Investment in the private offering will be issued approximately 0.15 million shares of series A Preferred Stock (or approximately 149.3 million shares on an as-converted-to-common basis) at a price of $403.47 per share. Each share of series A preferred stock will automatically convert into 1,000 shares of common stock, subject to certain beneficial ownership limitations. On a pro forma basis, based upon the number of shares of Selecta common stock and series A Preferred Stock issued in the acquisition and prior to the private financing, stockholders of Selecta immediately prior to the acquisition will own approximately 26.9 percent of the Company on an as-converted basis immediately after giving effect to this transaction.
With the cash from both companies at closing and the proceeds of the concurrent private financing, the combined company is expected to have over $110 million on hand to support the development of the Cartesian pipeline through the phase 3 study of lead product candidate, Descartes-08, a potential first-in-class RNA-engineered chimeric antigen receptor T-cell therapy (rCAR-T) for the treatment of generalized myasthenia gravis (MG), as well as the advancement of additional RNA cell therapy programs.
The merged company has been renamed Cartesian Therapeutics and it will trade on the Nasdaq market under the ticker “RNAC” effective November 14, 2023.
Selectra President and CEO Carsten Brunn will serve as president and CEO of the combined company. The combined company’s board will be led by current Selecta Chairman Carrie Cox and will include, among others, current Selecta board member Timothy Springer, as well as Cartesian Co-Founders Murat Kalayoglu and Michael Singer. All members of the Selecta board prior to the merger will continue to serve on the board following the closing of the transaction.
“With several potential value-driving milestones expected in the near-term, including data from the ongoing phase 2b study of Descartes-08 in MG expected in mid-2024, we are confident that this merger represents a significant opportunity for Selecta stockholders,” said Brunn. “Cartesian’s mission aligns seamlessly with Selecta’s commitment to advancing innovative therapies for the treatment of autoimmune diseases, and we look forward to working toward maximizing the potential of this robust pipeline and technology.”
Cartesian’s internally manufactured portfolio includes RNA cell therapies that are designed to be administered in an outpatient setting. Cartesian’s RNA-engineering approach has the potential to expand the reach of cell therapy to autoimmunity with potentially safer, potent, and less expensive therapies versus DNA analogs.
Cartesian’s technology platform, RNA Armory, is designed to enable precision control and optimization of engineered cells for diverse cell therapies leveraging multiple modalities, including autologous, allogeneic, and in vivo transfection. In addition, Cartesian’s state-of-the-art GMP manufacturing and internal research and development capabilities potentiates the optimization of processes in a rapid and iterative manner.
“RNA cell therapy has the potential to overcome the challenges of using conventional, costly DNA-engineered cell therapies to treat autoimmune diseases, including their toxicity and the need for preconditioning chemotherapy,” said Murat Kalayoglu, M.D., Ph.D., Co-Founder and former Chief Executive Officer of Cartesian. “With a shared vision of bringing meaningful therapeutic options to patients with autoimmune diseases, we are confident that our novel approach can thrive under Carsten’s leadership.”
Photo: Carsten Brunn, president and CEO of the newly merged company
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