PROCESSA PHARMACEUTICALS, INC. ANNOUNCES ACQUISITION OF VIDYA THERAPEUTICS, INC. AND APPROXIMATELY $200 MILLION CONCURRENT PRIVATE PLACEMENT TO ADVANCE BTK INHIBITOR, VT-7208, IN MULTIPLE DISEASE AREAS

Rhea-AI Summary

Processa (Nasdaq: PCSA) announced the acquisition of clinical-stage biotech Vidya Therapeutics in a stock-for-stock deal, adding lead asset VT-7208, a next-generation, CNS-penetrant covalent BTK inhibitor being developed for food allergy, chronic spontaneous urticaria (CSU) and relapsing multiple sclerosis (RMS).

Concurrently, Processa entered a definitive agreement for an oversubscribed private placement of approximately $200 million in gross proceeds via Series A non-voting convertible preferred stock, priced at $1,221.19 per preferred share ($1.22119 per common share equivalent). Post-transaction, on a fully diluted basis and assuming full conversion, existing Processa stockholders are expected to own about 0.9% of common stock, Vidya equity holders 46.0%, and private placement investors 52.6%. According to Processa, combined cash, including the financing, is expected to fund operations into the second half of 2029 and through multiple Phase 2 proof-of-concept readouts for VT-7208.

Positive

• ~$200 million private placement in gross proceeds to fund VT-7208
• Cash runway into 2H 2029 including financing proceeds
• VT-7208 Phase 1 data showed robust target engagement and was generally well-tolerated with no serious adverse events
• Three planned Phase 2 studies in food allergy, CSU and RMS starting 2026–2027
• Vidya holders receive 142.7k preferred shares (142.7M common equivalent) plus 558,398 common shares
• Oversubscribed financing led by multiple specialist healthcare institutional investors

Negative

• Substantial dilution: pre-deal Processa holders expected to own ~0.9% on a fully diluted basis
• Control shift: private placement investors expected to own ~52.6% post-transaction on a fully diluted basis
• Series A preferred conversion requires Processa stockholder approval, adding execution step

News Explained

The agreed financing is not yet closed, and converting its preferred shares still requires a Processa stockholder vote.

Processa announced that it had acquired Vidya and entered a definitive agreement for an approximately $200 million private placement; investors were described as committed, but the financing was still expected to close on July 30, 2026.

The placement is a private sale to selected investors outside a public offering. Its Series A preferred shares are non-voting and, subject to Processa stockholder approval and holder ownership limits, automatically convert into common shares; issuing those shares increases the total share count and reduces existing holders’ percentage ownership.

The specific unresolved checkpoints are the expected July 30, 2026 financing closing and the required Processa stockholder vote for conversion, which determine when the agreed capital is received and when the fully diluted ownership assumptions can apply.

Market reaction after Vidya acquisition: PCSA -29.18%

-29.18% $2.16 125.3x vol

15m delay

-29.18% Vs previous close

+20.5% Peak in 1 hr 24 min

$2.16 Last Price

$1.79 $6.02 Day Range

$5.08M Market Cap

125.3x Rel. Volume

Following this news, PCSA has declined 29.18%, reflecting a significant negative market reaction. Argus tracked a peak move of +20.5% during the session. Our momentum scanner has triggered 101 alerts so far, indicating very high trading interest and price volatility. The stock is currently trading at $2.16. Trading volume is exceptionally heavy at 125.3x the average, suggesting significant selling pressure.

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Market Context

PCSA insiders recorded Net Buying, with 24,542 shares bought and 0 sold over 90 days. That record ad...

Analysis

PCSA insiders recorded Net Buying, with 24,542 shares bought and 0 sold over 90 days. That record adds an ownership signal, while the preferred issuance leaves dilution and clinical execution as key watchpoints.

Key Figures

Private placement proceeds: Approximately $200 million Cash runway: Second half of 2029 Food allergy data: Second half of 2027 +5 more

8 metrics

Private placement proceeds Approximately $200 million Concurrent private placement gross proceeds

Cash runway Second half of 2029 Expected operations funding following the financing

Food allergy data Second half of 2027 Phase 2 proof-of-concept study

CSU data First half of 2028 Phase 2 proof-of-concept study

RMS data Second half of 2028 Phase 2 proof-of-concept study

Acquisition consideration 558,398 common shares and 142,744.100 Series A preferred shares Stock-for-stock acquisition of Vidya

Private placement price $1,221.19 per preferred share Equivalent to $1.22119 per share on an as-converted basis

Fully diluted ownership 0.9% / 46.0% / 52.6% Existing Processa stockholders / Vidya equity holders / financing investors

Key Terms

private placement, proof-of-concept, pharmacokinetics, non-voting convertible preferred stock, +1 more

5 terms

private placement financial

"Concurrent with the acquisition, Processa entered into a definitive agreement for a private placement financing"

A private placement is a sale of securities directly to a selected group of investors, typically institutions or accredited investors, instead of through a public offering. It lets a company raise money faster and with fewer regulatory steps; for existing shareholders it matters because the newly issued shares, often sold at a discount, increase the share count and can dilute their ownership.

proof-of-concept medical

"including data from a Phase 2 proof-of-concept study in food allergy"

A proof-of-concept is a demonstration that shows a new idea or method can work as intended, serving as a small-scale test before full development. For investors, it signals that a concept has been successfully tested in principle, reducing uncertainty about whether it can be practically implemented. This helps determine if further investment or effort is justified to develop the idea further.

pharmacokinetics medical

"predictable, dose-dependent pharmacokinetics in both the CSF and periphery"

Pharmacokinetics is the study of how a substance, such as a drug or chemical, moves through and is processed by the body over time. It tracks how it is absorbed, distributed, broken down, and eventually eliminated. For investors, understanding pharmacokinetics helps gauge the effectiveness, safety, and potential risks of new medications or treatments, which can influence a company’s success and valuation in the healthcare industry.

non-voting convertible preferred stock financial

"142,744.100 shares of Series A 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.

stock-for-stock transaction financial

"The acquisition is structured as a stock-for-stock transaction"

A stock-for-stock transaction is a deal where one company acquires or merges with another by exchanging its own shares instead of paying cash, so shareholders of the target receive shares in the buyer or the combined company based on a set ratio. For investors this matters because it changes who owns what percentage of the business, can dilute or concentrate existing holdings, and ties returns to the future performance of the combined company — like trading one set of trading cards for another in hopes the new set is more valuable.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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• Acquisition brings into Processa’s pipeline Vidya’s lead asset, VT-7208, a next-generation, CNS-penetrant, once-daily, oral potentially best-in-class Bruton’s tyrosine kinase inhibitor (BTKi) designed to overcome the efficacy and safety limitations of early-generation BTKi programs
• Concurrent oversubscribed private placement financing of approximately $200 million committed by a syndicate of leading healthcare institutional investors and mutual funds
• Private placement proceeds are expected to fund operations into the second half of 2029 and through key clinical milestones, including top-line data from Phase 2 proof-of-concept studies for food allergy, chronic spontaneous urticaria (CSU), and relapsing multiple sclerosis (RMS)
• Processa to host investor webcast on July 29, 2026, at 8:30 a.m. ET

VERO BEACH, FL, July 29, 2026 (GLOBE NEWSWIRE) -- Processa Pharmaceuticals, Inc. (Processa) (Nasdaq: PCSA) today announced it has acquired Vidya Therapeutics, Inc. (Vidya), a clinical-stage biotechnology company developing VT-7208, a Bruton's tyrosine kinase (BTK) inhibitor therapy for immune-mediated diseases with an initial focus on potentially best-in-class BTK inhibition in food allergy, chronic spontaneous urticaria and relapsing multiple sclerosis.

Concurrent with the acquisition, Processa entered into a definitive agreement for a private placement financing expected to result in gross proceeds of approximately $200 million, before deducting placement agent and other offering expenses, from a syndicate of new and existing investors, including Bain Capital Life Sciences, Janus Henderson Investors, RA Capital Management, SilverArc Capital, ADAR1 Capital Management, Cormorant Asset Management, Integral Health Asset Management, Marshall Wace, Octagon Capital, Soleus Capital, a large mutual fund, and other institutional investors.

Processa expects to use the proceeds to support the advancement of VT-7208 through multiple clinical milestones, including data from a Phase 2 proof-of-concept study in food allergy anticipated in the second half of 2027, data from a Phase 2 proof-of-concept study in CSU anticipated in the first half of 2028, and data from a Phase 2 proof-of-concept study in RMS anticipated in the second half of 2028. The company's cash and cash equivalents at closing, including gross proceeds expected from the concurrent private placement financing, are expected to fund operations into the second half of 2029.

“We’re thrilled to have the backing of a stellar group of healthcare investors who see the value in Vidya’s VT-7208 and share our vision for where it can go. This transaction gives us the capital to evaluate VT-7208’s potential, running our food allergy, CSU and RMS programs in parallel rather than sequentially,” said Sheila Gujrathi, M.D., Founder & Executive Chair of Vidya and newly appointed Board Director of Processa.

“This transaction with Vidya represents a compelling opportunity to create meaningful value for our shareholders through the acquisition of a differentiated, clinical-stage BTK inhibitor program with the potential to address significant unmet needs across multiple disease areas,” said George Ng, Chief Executive Officer of Processa.

ABOUT VT-7208

VT-7208 is a next-generation, CNS-penetrant, covalent BTKi designed to achieve potent, highly selective and durable BTK inhibition with preclinical and Phase 1 data that supports using lower doses than earlier BTKi’s. VT-7208’s selectivity profile was also designed to minimize off-target kinase activity, which Vidya believes may reduce hepatotoxicity risk relative to earlier BTKi’s.

BTK is a validated node in B-cell activation, mast cell signaling and innate immune function, implicating it across autoimmune, allergic and neuroinflammatory diseases. Vidya believes VT-7208’s dual peripheral and CNS activity positions it to modulate a broad range of diseases. Processa expects to initiate Phase 2 studies in food allergy and CSU in the second half of 2026, and in RMS in the first half of 2027, with multiple anticipated clinical milestones across the pipeline expected over the next 12–24 months.

In a Phase 1 clinical trial, at low milligram doses administered once-daily, VT-7208 demonstrated robust and sustained target engagement, validating signaling pathway modulation, the potential for durable pharmacodynamic activity, and predictable, dose-dependent pharmacokinetics in both the CSF and periphery. In the same study, no serious adverse events were observed, and VT-7208 was generally well-tolerated.

ABOUT THE TRANSACTION

The acquisition is structured as a stock-for-stock transaction, pursuant to which all outstanding equity interests of Vidya will be exchanged based on a fixed exchange ratio for a combination of 558,398 shares of Processa common stock, 142,744.100 shares of Series A non-voting convertible preferred stock (representing 142,744,100 shares of Processa common stock on an as-converted basis and without giving effect to any beneficial ownership limitations).

Concurrent with the acquisition, Processa entered into a definitive agreement for a private placement financing to raise approximately $200 million in gross proceeds, in which the investors will be issued 163,774.679 shares of Series A non-voting convertible preferred stock (or 163,774,679.00 shares of Processa common stock on an as-converted basis and without giving effect to any beneficial ownership limitations) at a price of $1,221.19 per share (or $1.22119 per share on an as-converted basis). The private placement is expected to close on July 30, 2026.

Subject to Processa stockholder approval in accordance with Nasdaq listing rules, each share of Series A non-voting convertible preferred stock will automatically convert into 1,000 shares of Processa common stock, subject to certain beneficial ownership limitations set by each holder.

The acquisition was approved by the Board of Directors of Processa and the Board of Directors and stockholders of Vidya. The closings of the acquisition and the private placement are not subject to the approval of Processa’s stockholders. The approval of Processa’s stockholders is required, among other things, under the terms of the Series A non-voting convertible preferred stock in order for the Series A non-voting convertible preferred stock to be converted into shares of Processa’s common stock, and Processa is required to hold a stockholder meeting for such vote. As a result of the transactions, stockholders of Processa immediately prior to the acquisition will own approximately 0.9% of Processa’s common stock, equity holders of Vidya immediately prior to the acquisition will own approximately 46.0% of Processa common stock and investors in the private placement financing will own approximately 52.6% of Processa common stock, in each case, calculated on a fully-diluted basis (without giving effect to any beneficial ownership limitations and assuming the conversion in full of the Series A non-voting convertible preferred stock) and based on the implied equity values of Processa and Vidya. Following the closing of the private placement, Processa is expected to have projected cash runway into the second half of 2029.

Leerink Partners is serving as exclusive financial advisor to Vidya and as lead placement agent for the concurrent private placement financing. Evercore ISI, UBS Investment Bank and Wells Fargo Securities are serving as co-placement agents for the concurrent private placement financing. Tungsten Advisors is serving as financial advisor to Processa and provided a fairness opinion to Processa’s board of directors. Cooley LLP is serving as legal counsel to Vidya. Katten Muchin Rosenman LLP is serving as legal counsel to Processa. Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. is serving as legal counsel to the placement agents.

WEBCAST INFORMATION AND COMPANY PRESENTATION

Wednesday, July 29, 2026 @ 8:30 a.m. ET

Webcast: Click Here

A replay of the webcast presentation will be temporarily archived on the Investors section of the company’s website following the presentation.

ABOUT VIDYA

Vidya is a clinical-stage biotechnology company developing a Bruton's tyrosine kinase (BTK) inhibitor therapy for immune-mediated diseases. The company is advancing a potentially best-in-class BTK inhibitor (BTKi) designed to improve on the efficacy and safety of early-generation programs. Vidya has three parallel development programs: food allergy and chronic spontaneous urticaria (CSU) in immunology, and relapsing multiple sclerosis (RMS) in neurology, where its CNS-penetrant profile addresses an area of high unmet need. With Phase 1 complete, the company intends to advance all three programs toward Phase 2 proof-of-concept studies, with initial data expected in 2027 and 2028.

ABOUT PROCESSA

Processa is a clinical-stage pharmaceutical company advancing innovative drug candidates through a disciplined, science-driven development strategy. By combining more than 30 years of drug development expertise with its proprietary Regulatory Science Approach, Processa designs efficient clinical programs focused on identifying optimal dosing, strengthening the benefit-risk profile, and improving the likelihood of regulatory success.

The Processa team has contributed to more than 30 regulatory approvals across numerous divisions of the U.S. Food and Drug Administration. Its development approach integrates pharmacokinetics, metabolism, safety, efficacy, and dose-response data to establish an Optimal Dosage Regimen for each candidate, with the goal of delivering meaningful treatment options to patients through efficient and scientifically supported regulatory pathways.

In addition to advancing the clinical-stage BTK inhibitor program, Processa intends to continue the development of its legacy pharmaceutical assets, including PCS499 and PCS12852, while evaluating strategic opportunities designed to maximize their clinical and long-term value.

FORWARD-LOOKING STATEMENTS

Certain statements in this press release, other than purely historical information, may constitute “forward-looking statements” within the meaning of the federal securities laws, including for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995, concerning Processa, Vidya, the concurrent private placement financing and the acquisition of Vidya by Processa (the “Transactions”) and other matters. These forward-looking statements include, but are not limited to, express or implied statements relating to the company’s expectations, hopes, beliefs, intentions or strategies regarding the future including, without limitation, statements regarding: the Transactions, including the closing of the concurrent private placement financing, if any, and the expected effects, perceived benefits or opportunities and related timing with respect thereto; expectations regarding or plans for the Processa’s pipeline, including its ongoing clinical trials, research and development programs and the expected timing for key milestones, including the release of clinical data; the potential benefits of VT-7208; and expectations regarding the use of proceeds from the concurrent private placement financing and cash runway expectations therefrom, including such proceeds funding the company through key clinical milestones. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “opportunity,” “potential,” “milestones,” “pipeline,” “can,” “goal,” “aim,” “strategy,” “target,” “seek,” “anticipate,” “achieve,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “predict,” “project,” “should,” “will,” “would” and similar expressions (including the negatives of these terms or variations of them) may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. These forward-looking statements are based on current expectations and beliefs concerning future developments and their potential effects. There can be no assurance that future developments affecting the company or the Transactions will be those that have been anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond the company’s control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to those uncertainties and factors described under the heading “Risk Factors” and in the company’s most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission (the “SEC”) on March 18, 2026, as well as discussions of potential risks, uncertainties, and other important factors included in other filings by the company from time to time, as well as risk factors associated with companies, such as Vidya, that operate in the biotechnology industry. Should one or more of these risks or uncertainties materialize, or should any of the company’s assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Nothing in this press release should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements in this press release, which speak only as of the date they are made and are qualified in their entirety by reference to the cautionary statements herein. The company does not undertake or accept any duty to release publicly any updates or revisions to any forward-looking statements. This press release does not purport to summarize all of the conditions, risks and other attributes of an investment in the company.

CONTACTS

Vidya Therapeutics
Media
Ryan Flinn
The Grace Group
ryan@gracegroup.us

General Inquiries
info@vidyatx.com

FAQ

What did Processa (PCSA) acquire from Vidya Therapeutics in July 2026?

Processa acquired Vidya Therapeutics in a stock-for-stock transaction, adding the BTK inhibitor VT-7208 to its pipeline. According to Processa, VT-7208 targets food allergy, chronic spontaneous urticaria and relapsing multiple sclerosis with CNS-penetrant, once-daily oral dosing and a differentiated selectivity profile.

How large is the July 2026 private placement announced by Processa (PCSA)?

Processa entered a definitive agreement for an oversubscribed private placement of approximately $200 million in gross proceeds. According to Processa, investors will receive Series A non-voting convertible preferred stock, priced at $1,221.19 per preferred share, equivalent to $1.22119 per share of common stock upon conversion.

How will ownership of Processa (PCSA) change after the Vidya acquisition and $200 million financing?

On a fully diluted basis, existing Processa stockholders are expected to own about 0.9% of common stock. According to Processa, Vidya equity holders are expected to own ~46.0% and private placement investors ~52.6%, assuming full conversion of Series A preferred shares.

What is VT-7208 and what Phase 2 timelines did Processa (PCSA) disclose?

VT-7208 is a next-generation, CNS-penetrant covalent BTK inhibitor for immune-mediated diseases. According to Processa, Phase 2 food allergy and CSU studies are expected to start in the second half of 2026, with an RMS Phase 2 study planned for the first half of 2027.

How long does Processa (PCSA) expect its cash runway to last after the July 2026 financing?

Processa expects its cash and cash equivalents at closing, including gross proceeds from the private placement, to fund operations into the second half of 2029. According to Processa, this runway should cover planned Phase 2 proof-of-concept readouts for VT-7208.

What are the key terms of Processa’s (PCSA) Series A non-voting convertible preferred stock?

Each Series A preferred share is exchangeable into 1,000 Processa common shares, subject to beneficial ownership limits. According to Processa, conversion requires stockholder approval under Nasdaq rules, and the preferred shares are used in both the acquisition and private placement.

When will Processa (PCSA) report Phase 2 data for VT-7208 in food allergy, CSU and RMS?

Processa anticipates Phase 2 proof-of-concept data in food allergy in the second half of 2027, CSU in the first half of 2028, and RMS in the second half of 2028. According to Processa, these milestones are funded by the July 2026 financing.