Boundless Bio and Serapha Bio Merge, Expected Cash Dividend of $48M

Boundless Bio and Serapha Bio announced that they have entered into a definitive merger agreement pursuant to which Serapha will combine with Boundless Bio in an all-stock merger. Prior to the closing, Boundless Bio expects to declare a cash dividend to pre-merger Boundless stockholders. Upon completion of the transaction, the combined company plans to operate under the name Serapha Bio, Inc. and is expected to trade on Nasdaq under the ticker symbol (AATD). In support of the proposed merger, Serapha has secured commitments for pre-closing private investments of approximately $230M from a syndicate of investors co-led by RA Capital Management and RTW Investments and includes participation by Janus Henderson Investors, Decheng Capital, Vivo Capital, Casdin Capital, LifeSci Venture Partners, Logos Capital, Balyasny Asset Management, and Eventide Asset Management, of which approximately $138M has already been funded in a Series A financing. The additional $92M in funding is expected to close substantially concurrently with the merger, subject to customary closing conditions. The combined company's cash and cash equivalents balance at closing, including the funds from the private placement, is expected to fund Serapha's operations into the second half of 2029 and provide runway through Phase 2 completion and Phase 3 initiation for SERP-01. Serapha licensed SERP-01, developed as YOLT-202 in Greater China, from YolTech Therapeutics in June, in exchange for an upfront cash payment and a minority equity stake in Serapha. YolTech is also eligible to receive regulatory and commercial milestones totaling over $2 billion and tiered royalties on net sales of SERP-01. YolTech has been enrolling AATD patients in an Investigator-Initiated Trial in Renji Hospital, Shanghai, China and retains development and commercialization rights for the Greater China territory. The combined company will focus on the development and commercialization of Serapha's lead clinical-stage candidate, SERP-01, for the treatment of severe AATD. AATD is a hereditary disorder most commonly caused by the SERPINA1 E342K point mutation, which causes the liver to produce a misfolded form of AAT, known as Z-AAT, in place of the normal M-AAT. The resulting toxic accumulation of Z-AAT polymers in the liver can lead to hepatitis, fibrosis, and cirrhosis, while reduced levels of functional AAT in circulation leave the lungs vulnerable to progressive emphysema and COPD. There is estimated to be up to 100,000 individuals with the severe PiZZ genotype in the United States, and current treatment is limited to supportive care, liver transplantation for end-stage disease, and weekly intravenous augmentation therapy that does not address the underlying liver pathology. SERP-01 is an investigational in vivo base editing therapy designed to correct the SERPINA1 E342K mutation at its source. By restoring production of functional M-AAT while reducing toxic Z-AAT, SERP-01 has the potential to address both the liver and lung manifestations of the disease with a single administration. Under the terms of the merger agreement, as of the closing and subject to the assumptions and adjustments set forth in the merger agreement, the pre-merger Boundless Bio stockholders are expected to own approximately 3.7% of the combined company and the pre-merger Serapha stockholders are expected to own approximately 96.3% of the combined company. Prior to closing, Boundless Bio expects to declare a cash dividend to pre-merger Boundless Bio stockholders to distribute excess net cash, which is currently expected to be approximately $44M to $48M, subject to adjustment based on Boundless Bio's net cash at closing and the terms of the merger agreement. The transaction has received unanimous approval by the board of directors of both companies and is expected to close in the fourth quarter of 2026, subject to certain closing conditions, including, among others, approval by the stockholders of each company, approval of the Nasdaq listing application, the effectiveness of a registration statement to be filed with the SEC to register the securities to be issued in connection with the proposed merger, expiration, or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, if applicable, and the satisfaction of other customary closing conditions.