KALA BIO Enters Into $6 Million Securities Purchase Agreement with Investor David E. Lazar

Rhea-AI Summary

KALA BIO (NASDAQ:KALA) entered a $6.0 million securities purchase agreement with investor David E. Lazar on Dec 1, 2025, receiving $1.8 million at the first closing and issuing non-voting convertible Series AA preferred stock. Effective immediately, Mr. Lazar was appointed CEO and Chairman; former CEO Todd Bazemore remains on the board. The company previously announced on Sept 29, 2025 that its CHASE Phase 2b trial of KPI-012 failed the primary endpoint and key secondaries, prompting a temporary development pause. KALA plans to redevelop candidates and pursue a potential strategic transaction; the $4.2 million second closing requires stockholder approval expected in Q1 2026.

Positive

• Committed financing of $6.0 million
• Immediate cash received of $1.8 million
• New CEO appointment effective Dec 1, 2025
• Potential additional funding of $4.2 million upon approval

Negative

• CHASE Phase 2b trial failed primary endpoint on Sept 29, 2025
• Trial also failed key secondary efficacy endpoints
• Development of KPI-012 was temporarily paused to preserve cash
• Second closing contingent on stockholder approval in Q1 2026
• Issuance of non-voting convertible preferred stock may affect shareholders

Insights

Corporate Finance and Governance Expert

$6M financing and CEO/Chair appointment stabilizes runway but depends on shareholder approval and further funding.

KALA secured a $6 million securities purchase agreement with an initial $1.8 million closing, with the remaining $4.2 million contingent on stockholder approval in Q1 2026. The structure uses non‑voting convertible preferred shares and delivers immediate working capital while preserving existing common equity control dynamics because the shares are non‑voting.

Risks hinge on the conditional second closing and governance changes: the follow‑on $4.2 million requires shareholder consent, and the new CEO/Chair appointment is effective immediately but may prompt further board or strategic shifts. Watch the upcoming stockholder meeting in Q1 2026, the completion of the second closing, and any disclosed terms of conversion that would affect capital structure.

Clinical Development and Strategy Expert

Failed Phase 2b results for KPI‑012 materially change development options; financing funds redeployment and strategic review.

The CHASE Phase 2b trial did not meet its primary endpoint and failed to show meaningful differences versus placebo, and KALA paused KPI‑012 development to conserve cash. The new investment explicitly funds evaluation and redevelopment of product candidates and the patent portfolio rather than immediate Phase 3 advancement of KPI‑012.

Key near‑term signals include any protocol changes or pivoted indications for KPI‑012, announcements on redevelopment plans, and whether the company pursues a strategic transaction; expect updates around the Q1 2026 stockholder meeting and subsequent disclosure of redevelopment timelines or partnering intent.

Investment to support the continued evaluation and redevelopment of KALA’s product candidates and patent portfolio, and provide working capital and funding for a potential future strategic transaction

ARLINGTON, Mass., Dec. 01, 2025 (GLOBE NEWSWIRE) -- KALA BIO, Inc. (NASDAQ:KALA), a clinical-stage biopharmaceutical company dedicated to the research, development and commercialization of innovative therapies for rare and severe diseases of the eye, announces it has entered into a $6 million securities purchase agreement with private investor David E. Lazar for the purchase of the Company's non-voting convertible preferred stock. KALA received $1.8 million in the first of two closings under the agreement. Effective immediately, Mr. Lazar has been appointed KALA's Chief Executive Officer and Chairman of the Board. Former Chief Executive Officer Todd Bazemore continues to serve on the Board.

On September 29, 2025, KALA announced that its CHASE (Corneal Healing After SEcretome therapy) Phase 2b clinical trial of KPI-012 for the treatment of persistent corneal epithelial defect (“PCED”) did not meet the primary endpoint of complete healing of PCED as measured by corneal fluorescein staining. The trial also failed to achieve statistical significance for key secondary efficacy endpoints and did not show any meaningful difference between either KPI-012 treatment arm and the placebo arm. KALA had temporarily ceased development of KPI-012 to preserve cash and explore strategic options, but following the investment by Mr. Lazar, KALA plans to continue evaluating and redeveloping its therapeutic candidates for other standalone uses or in conjunction with other therapeutic candidates or products while simultaneously exploring a potential strategic transaction.

"In making this significant investment in KALA, I look forward to continuing to evaluate and redevelop the Company’s product candidates while actively exploring strategic opportunities to drive value for our stockholders," said Mr. Lazar. "I appreciate the KALA Board's unanimous support for this transaction and faith in my ability and proven track record to build upon the Company’s foundation and introduce new strategic alternatives."

"David brings to KALA significant capital restructuring and reverse merger expertise, and I look forward to working with him to evaluate and redevelop the Company’s product candidates and identify business opportunities and strategic alternatives that could be transformative for KALA," said Mr. Bazemore. "Following our Board's careful review of strategic options, we view this transaction with Mr. Lazar as the best path forward for our stockholders."

In conjunction with the securities purchase agreement's first closing, KALA has issued new shares of non-voting convertible Series AA preferred stock in exchange for Mr. Lazar's initial investment of $1.8 million. Completion of the investment transaction and the second closing are contingent on obtaining stockholder approval at the next meeting of stockholders, which is expected to be held during the first quarter of 2026. Following stockholder approval and upon meeting certain other closing conditions, KALA will issue new shares of non-voting convertible Series AAA preferred stock with the second closing investment of $4.2 million. 

About KALA BIO, Inc.

KALA is a clinical-stage biopharmaceutical company dedicated to the research, development, and commercialization of innovative therapies for rare and severe diseases of the eye. KALA’s biologics-based investigational therapies utilize KALA’s proprietary mesenchymal stem cell secretome (MSC-S) platform. KALA’s lead product candidate, KPI-012, is a human MSC-S, which contains numerous human-derived biofactors, such as growth factors, protease inhibitors, matrix proteins, and neurotrophic factors. KPI-012 received Orphan Drug and Fast Track designations from the U.S. Food and Drug Administration for the treatment of persistent corneal epithelial defect (PCED), a rare disease of impaired corneal healing.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. Any statements in this press release about KALA’s future expectations, plans and prospects, including but not limited to statements about KALA’s plans to continue the evaluation and redevelopment of its product candidates, assessing strategic alternatives, and other statements containing the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would,” and similar expressions constitute forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: uncertainty regarding whether the continued evaluation and redevelopment of KALA’s product candidates will be successful or yield different results, KALA’s ability to successfully identify and pursue strategic options on attractive terms, or at all, and other important factors, any of which could cause KALA’s actual results to differ from those contained in the forward-looking statements, discussed in the “Risk Factors” section of KALA’s Annual Report on Form 10-K, most recent Quarterly Report on Form 10-Q and other filings KALA makes with the Securities and Exchange Commission. These forward-looking statements represent KALA’s views as of the date of this press release and should not be relied upon as representing KALA’s views as of any date subsequent to the date hereof. KALA does not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

KALA Contact

David Lazar
Chief Executive Officer and Chairman of the Board
david@activistinvestingllc.com

FAQ

What did KALA (KALA) announce on Dec 1, 2025 regarding new financing?

KALA entered a $6.0 million securities purchase agreement with David E. Lazar and received $1.8 million at the first closing.

Who is the new CEO and Chairman of KALA (KALA) after the Dec 1, 2025 transaction?

Private investor David E. Lazar was appointed CEO and Chairman effective Dec 1, 2025.

What happened to KALA's KPI-012 CHASE Phase 2b trial announced Sept 29, 2025?

The CHASE Phase 2b trial failed the primary endpoint and key secondary endpoints and showed no meaningful difference versus placebo.

How much additional funding will KALA (KALA) receive at the second closing and when is it expected?

An additional $4.2 million is expected at the second closing, contingent on stockholder approval expected in Q1 2026.

Will KALA continue developing its therapeutic candidates after the investment?

Yes; KALA plans to continue evaluating and redeveloping candidates while exploring a potential strategic transaction.