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

News Market Reaction

+37.67% 62.7x vol

43 alerts

+37.67% News Effect

+105.6% Peak in 5 hr 29 min

+$4M Valuation Impact

$16M Market Cap

62.7x Rel. Volume

On the day this news was published, KALA gained 37.67%, reflecting a significant positive market reaction. Argus tracked a peak move of +105.6% during that session. Our momentum scanner triggered 43 alerts that day, indicating elevated trading interest and price volatility. This price movement added approximately $4M to the company's valuation, bringing the market cap to $16M at that time. Trading volume was exceptionally heavy at 62.7x the daily average, suggesting very strong buying interest.

Data tracked by StockTitan Argus on the day of publication.

Key Figures

Securities agreement size: $6 million First closing proceeds: $1.8 million Second closing amount: $4.2 million +3 more

6 metrics

Securities agreement size $6 million Total securities purchase agreement with David E. Lazar

First closing proceeds $1.8 million Initial funding received under the agreement

Second closing amount $4.2 million Planned second closing investment, subject to stockholder approval

Number of closings 2 closings Structure of the securities purchase agreement

Trial phase Phase 2b CHASE trial of KPI-012 in PCED

Meeting timing Q1 2026 Expected stockholder meeting for approval of second closing

Market Reality Check

Price: $0.6050 Vol: Volume 2,762,072 is about...

low vol

$0.6050 Last Close

Volume Volume 2,762,072 is about 0.13x the 20-day average 21,267,950, indicating muted trading ahead of this news. low

Technical Shares at $0.6948 are trading well below the 200-day MA of $5.44, reflecting a heavily broken trend and proximity to the $0.6076 52-week low.

Peers on Argus

Among tracked biotech peers, BMEA and CRBP showed declines near -6.6%, while EQ ...

1 Up 3 Down

Among tracked biotech peers, BMEA and CRBP showed declines near -6.6%, while EQ rose about 4.4%. With three peers in the momentum scan moving mostly down, KALA’s pre-news weakness (-2.06% over 24h) aligned more with broader small-cap biotech pressure than a company-specific move.

Common Catalyst Same-day peer headlines center on clinical and conference updates in biotech, but price moves appear driven more by sector-wide risk sentiment than a single shared catalyst.

Historical Context

5 past events · Latest: Dec 05 (Negative)

Pattern 5 events

Date	Event	Sentiment	Move	Catalyst
Dec 05	Equity offering	Negative	-14.3%	Closing of $10M registered direct equity financing at $1.00 per share.
Dec 04	Equity offering	Negative	+13.5%	Announcement of $10M registered direct offering for debt repayment and cash.
Dec 01	Strategic financing	Positive	+37.7%	New $6M preferred investment and CEO transition to David Lazar.
Sep 29	Trial failure	Negative	-89.3%	Phase 2b KPI-012 trial failed primary and key secondary endpoints.
Sep 03	Conference appearance	Positive	+23.1%	Planned presentation at H.C. Wainwright investment conference and meetings.

Pattern Detected

News has often produced strong price swings, with negative clinical and financing events generally aligning with selloffs, while some financings have seen mixed reactions.

Recent Company History

Over the last six months, KALA moved from conference participation on Sep 10, 2025 to a major setback on Sep 29, 2025 when the CHASE Phase 2b trial of KPI-012 failed key endpoints and development was ceased. Subsequent regulatory filings detailed loan defaults and going-concern issues. On Dec 1, 2025, the company announced a $6.0 million investment and leadership change, followed by a $10 million registered direct offering on Dec 4–5, 2025. Today’s agreement fits into this broader restructuring and recapitalization effort.

Market Pulse Summary

The stock surged +37.7% in the session following this news. A strong positive reaction aligns with p...

Analysis

The stock surged +37.7% in the session following this news. A strong positive reaction aligns with prior instances where financing or strategic updates triggered sharp moves, such as the 37.67% gain on similar news on Dec 1, 2025. The announced $6 million investment and leadership change could be seen as a lifeline after failed trials and loan default. However, heavy prior dilution, going‑concern warnings, and reliance on stockholder approvals could limit how durable any squeeze or relief rally proved.

Key Terms

non-voting convertible preferred stock, Phase 2b, primary endpoint, secondary efficacy endpoints, +2 more

6 terms

non-voting convertible preferred stock financial

"for the purchase of the Company's non-voting convertible preferred stock."

A non-voting convertible preferred stock is a share that normally pays a fixed dividend and takes priority over common stock for payouts, but does not grant the holder the right to vote on corporate matters. It can be exchanged later for a set number of common shares, offering the potential to participate in price gains without immediate control—like holding a high-yield loan that can be turned into equity, which matters to investors weighing steady income, upside potential, and possible dilution of ownership.

Phase 2b medical

"its CHASE (Corneal Healing After SEcretome therapy) Phase 2b clinical trial of KPI-012"

Phase 2b is a stage in the development of a new medicine or treatment where researchers test its effectiveness and safety in a larger group of people. This step helps determine whether the treatment works well enough to move forward and if it has manageable side effects, which is important for investors because successful results can lead to potential approval and market opportunity.

primary endpoint medical

"did not meet the primary endpoint of complete healing of PCED"

The primary endpoint is the single main result a clinical study is designed to measure to decide if a treatment works, like the finish line in a race that tells you who won. Investors care because meeting or missing this goal drives regulatory decisions, future sales expectations and stock value — it turns trial data into a clear yes-or-no signal about a drug’s commercial prospects.

secondary efficacy endpoints medical

"failed to achieve statistical significance for key secondary efficacy endpoints"

Secondary efficacy endpoints are additional outcomes a clinical trial tracks beyond the single main outcome, measuring other ways a treatment may help patients—for example symptom relief, quality of life, or longer-term benefits. Think of the primary goal as the main prize and secondary endpoints as bonus prizes that show broader usefulness; strong secondary results can boost a drug’s perceived value, support marketing claims, and influence regulatory or commercial decisions that matter to investors.

placebo arm medical

"did not show any meaningful difference between either KPI-012 treatment arm and the placebo arm."

A placebo arm is the group of participants in a clinical trial who receive an inactive substance or treatment designed to look like the real therapy, serving as a control for comparison. Like a blind taste test where some people get plain water and others get a new drink, this comparison shows whether the new treatment truly works beyond expectation or chance, which matters to investors because clear, reliable trial results drive regulatory approval, market prospects and the perceived value of a drug.

strategic transaction financial

"working capital and funding for a potential future strategic transaction"

A strategic transaction is a deliberate business deal—such as a merger, acquisition, divestiture, joint venture or major investment—designed to change a company’s long‑term position, growth path or cost structure. Investors care because these deals can materially alter future revenue, profits and risk exposure; like rearranging pieces on a chessboard, a successful transaction can improve competitive strength and shareholder value, while a poorly executed one can harm them.

AI-generated analysis. Not financial advice.

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.