SAN DIEGO, October 1, 2023 – Clinical-stage biopharmaceutical company Gossamer Bio, which is focused on the development and commercialization of seralutinib for the treatment of pulmonary arterial hypertension, recently announced that it had entered into a mammoth securities purchase agreement with institutional and accredited investors to sell securities in a private placement for gross proceeds of approximately $212 million.
The financing, which includes participation from investors including Madison Avenue Partners, Armistice Capital, and Invus, comprises 129,869,440 shares of its common stock and accompanying warrants to purchase up to 32,467,360 shares of common stock. Latham & Watkins LLP represented Gossamer Bio in the transaction, with a corporate team led by San Diego partner Matt Bush with associates Shelby Harrison and Emilie McConnachie.
The Gossamer Bio website states that the company is currently developing a targeted approach to treat the proliferation, fibrosis, and inflammation associated with pulmonary arterial hypertension.
Gossamer Bio is a clinical-stage biopharmaceutical company that is engaged in the development and commercialization of its proprietary drug seralutinib for the treatment of pulmonary arterial hypertension.
Founded in 2015, the company hopes to become an industry leader in pulmonary hypertension and to enhance the lives of those who suffer from it.
What’s Next for Gossamer Bio?
This latest round of financing is symptomatic of the recent trends in the health care space: fewer, but larger, deals taking place at a slower pace, which are helping encourage more sustainable and long-term growth for funding recipients. It’s also assisting investors like Armistice Capital to meet their long-term targets.
According to Gossamer Bio, the net proceeds of this financing will be used to fund the ongoing development and commercialization of seralutinib and for working capital and general corporate purposes.
“We are grateful for the support from this investor syndicate and thrilled to embark on the registrational PROSPERA Phase 3 trial, the next step toward bringing seralutinib to patients with [pulmonary arterial hypertension],” said Faheem Hasnain, co-founder, chairman, and CEO of Gossamer Bio in a press release reported by Yahoo Finance.
Gossamer Bio’s goal is to be an industry leader enhancing the lives of patients suffering from pulmonary hypertension. In May, the company announced its first quarter 2023 financial results.
“Our team continues to build momentum across multiple fronts following the positive results from our Phase 2 TORREY study of seralutinib in PAH patients. With recent feedback from both the [Food and Drug Administration] and [European Medicines Agency], we are well positioned to commence our registration program,” said Hasnain.
Phase 3 Clinical Trials
Gossamer Bio is reportedly on track to begin its Phase 3 clinical trial of seralutinib in the coming months, moving the company one step closer to its goal of “bringing a potential new medicine to patients” suffering from pulmonary arterial hypertension.
According to Gossamer Bio, the planned Phase 3 trial will be a randomized, double-blind, placebo-controlled, global clinical trial in pulmonary arterial hypertension patients. Patients will be randomized to receive either seralutinib or a placebo, in addition to their background pulmonary arterial hypertension therapies. A single 90 milligram dose will be tested twice daily against a placebo.
Despite its recent successes, however, Gossamer Bio recently made the “difficult decision” to cut staff by more than 25% following an operational restructuring. Hasnain cited a desire to “prioritize resources around the development of seralutinib” as the driver of the restructuring, something he says was a “necessary step” to focus the organization on activities that maximize the potential of seralutinib.
“Further development of all clinical and preclinical product candidates, outside of seralutinib, has been terminated, and strategic options are being assessed for those candidates. Gossamer Bio is working diligently with affected employees to assist in their transition to new opportunities,” read a corporate update attached to a press release concerning the company’s first-quarter financials, published in May.