Rallybio to Acquire Candid Therapeutics, Secures Over $505M Financing

Rallybio and Candid Therapeutics announced that they have entered into a definitive agreement pursuant to which Rallybio will acquire Candid through a merger transaction. Upon completion of the merger, the combined company expects to operate under the name Candid Therapeutics and trade on Nasdaq under the ticker symbol (CDRX). In connection with the merger, Candid entered into subscription agreements for a concurrent oversubscribed and upsized private financing of over $505M in gross proceeds with a syndicate of leading healthcare institutional investors and mutual funds, including Venrock Healthcare Capital Partners, RA Capital Management, Janus Henderson Investors, accounts advised by T. Rowe Price Associates, Inc., venBio Partners, Viking Global Investors, Cormorant Asset Management, Foresite Capital, Soleus Capital, TCGX, Vivo Capital, a life sciences focused institutional investor, several additional mutual funds and other institutional investors. The combined company's cash balance at closing is expected to fund operations through 2030, supporting the advancement of Candid's diversified pipeline of TCE programs through multiple clinical milestones, including the initiation and clinical readouts of Phase 2 studies for cizutamig, a B-cell maturation antigen targeting TCE, in myasthenia gravis and interstitial lung disease secondary to rheumatological diseases. The transaction has been unanimously approved by the boards of directors of both companies and is expected to close in mid-2026, subject to certain closing conditions, including the approval by the stockholders of each company, the effectiveness of a registration statement to be filed with the SEC to register the shares of Rallybio common stock to be issued in connection with the transaction, the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and the satisfaction of other customary closing conditions. Following closing, pre-Transaction Rallybio equityholders are expected to own approximately 3.65% of the combined company, and pre-Transaction Candid equityholders are expected to own approximately 96.35% of the combined company, calculated on a treasury stock method basis and assuming Rallybio has net cash at closing of $37.5M. In addition, pre-closing Rallybio stockholders will receive contingent value rights entitling them to a portion of certain cash proceeds received by the combined company from its previously announced sale of interests in REV102 and potential disposition of Rallybio's other legacy assets. Pro-forma cash of approximately $700M at closing is expected to provide the combined company with a financial foundation to advance its pipeline through multiple value-creating milestones. The combined company will be led by Ken Song, chairman, president and CEO of Candid, with a management team that brings deep expertise in autoimmune drug development, TCE biology, and global clinical operations. Under the terms of the merger agreement, Rallybio will acquire Candid pursuant to the merger. At closing, Candid stockholders will receive newly issued shares of Rallybio common stock, with the exchange ratio to be determined based on the relative valuations of the two companies at closing. Immediately following closing, the combined company will change its name to Candid Therapeutics, Inc. and trade on Nasdaq under the ticker symbol (CDRX). In connection with the transaction, a syndicate of leading healthcare institutional investors and mutual funds has committed to invest over $505M in a concurrent private financing in Candid. The financing is expected to close immediately prior to the Merger. In connection with the transaction certain stockholders of Candid and Rallybio have executed support agreements, pursuant to which they have agreed to vote all their shares of capital stock in favor of the transaction.