Valion Bio, Inc. entered into a letter agreement with 3i, LP for a new funding tranche under its existing Series B Preferred Purchase Agreement. The company agreed to issue 1,500 Series B Non-Voting Convertible Preferred Shares at $1,000 per share plus related Series B warrants for an aggregate purchase price of $1,500,000, with closing expected on or about August 17, 2026, in a transaction exempt from registration under Section 4(a)(2) and/or Rule 506(b).
Valion also agreed that 3i and other investors will receive payments under a new Royalty Agreement equal to 5% of gross revenue of subsidiary Velocity Bioworks, Inc. from third parties for 10 years. Lisa Wolf was appointed Chief Operating Officer while continuing as Chief Financial Officer, and Michael K. Handley was terminated as Chief Executive Officer, both effective August 16, 2026.
At an August 14, 2026 special meeting, stockholders approved granting the board authority to implement a reverse stock split at a ratio between 1-for-5 and 1-for-50 within twelve months, and also approved a proposal allowing adjournment of the meeting to solicit additional proxies if needed.
Valion Bio, Inc. common stock is the subject of this amended Schedule 13D filing by 3i, LP, Tumim Stone Capital, LLC, 3i Management LLC and Maier J. Tarlow. The reporting group states beneficial ownership of 1,742,699 shares of common stock, representing 9.9% of the outstanding class.
The 9.9% figure is based on 15,776,805 shares of Valion Bio common stock outstanding, which include multiple share issuances to 3i, LP following conversions of Series B and Series C Convertible Preferred Stock and earlier outstanding shares disclosed in a proxy statement. Of the reported holdings, 75,069 shares are common stock already issued, and 1,667,630 shares are issuable upon exercises of warrants, conversions of a senior secured convertible note with original principal of $16,253,147.10, and conversions of Series B and Series C preferred stock, all subject to a 9.99% beneficial ownership limitation Blocker.
Valion Bio, Inc. reports a transition to a late-stage biopharma and CDMO model while posting a net loss of $13.3 million for the six months ended June 30 2026. Operating expenses rose sharply as research and development reached $4.6 million and selling, general and administrative costs $7.5 million.
Cash and cash equivalents were $2.1 million (plus $0.4 million restricted) at June 30 2026, after using $10.3 million in cash for operating activities, and the company carries a $66.5 million accumulated deficit. Management states that these factors raise substantial doubt about its ability to continue as a going concern and that substantial additional financing will be required.
Valion licensed TLR5 agonist Entolimod and related rights from Statera, capitalized $0.75 million of drug-substance inventory upon validation, and acquired Scorpius’ CDMO assets via a $16.25 million senior secured convertible note. New facility leases created $9.8 million in right-of-use assets and future minimum lease payments of $15.6 million. The company also discloses a Nasdaq notice for non-compliance with the $1.00 minimum bid price requirement.
Valion Bio, Inc. shareholder group 3i, LP, Tumim Stone Capital, 3i Management and Maier J. Tarlow filed Amendment No. 1 to their Schedule 13D on the company’s common stock. The group reports beneficial ownership of up to 446,759 shares, representing 9.9% of the 4,407,364 shares of common stock outstanding, including shares issuable from preferred stock, warrants and a senior secured convertible note, all subject to a 9.99% beneficial ownership limitation.
The amendment discloses an August 9, 2026 proposal by 3i, LP to purchase up to $9,000,000 of Series B or Series C preferred stock, with $3,000,000 immediately available and $6,000,000 in later installments, conditioned on due diligence, definitive agreements, required approvals, the issuer’s continued Nasdaq listing and execution of a board-approved plan. The proposal also contemplates CEO and board changes, with two directors nominated by 3i, LP joining the board and Maier J. Tarlow becoming chairman.
Valion Bio, Inc. reports achieving its first development milestone under its amended exclusive license with Statera Biopharma for the TLR5 agonist Entolimod in the Acute Radiation Syndrome indication. Validation of current inventory for distribution and sales triggered a $750,000 milestone payment, the first portion of up to $1,750,000 in ARS development milestones and part of broader obligations that may direct up to $5.6 million of subsequent payments to Avenue Capital on Statera’s behalf. Additional cash-or-stock milestones are outlined for potential Neutropenia indications.
To satisfy the Milestone Payment, Valion issued an aggregate of 1,287.8685 shares of Series A Non-Voting Convertible Preferred Stock as Milestone Shares to Statera and Avenue under a securities purchase agreement that includes resale registration rights for the underlying common stock within 60 calendar days following the Closing Date. These unregistered securities were sold to accredited investors under Section 4(a)(2) and Regulation D and are restricted, with conversion limited so each holder’s beneficial ownership remains between 4.9% and 19.9% of outstanding common shares.
Valion Bio, Inc. has a significant investor group led by 3i, LP, Tumim Stone Capital, LLC, 3i Management LLC and Maier J. Tarlow, which together report beneficial ownership of up to approximately 9.9 % of Valion Bio’s common stock, based on 4,407,364 shares outstanding. 3i, LP’s position includes 382,058 shares held directly and an additional 64,701 shares issuable from warrants, a senior secured convertible note and Series B and Series C preferred stock, all subject to a 9.99 % beneficial ownership limitation. Tumim Stone holds 49,242 shares, or 1.1 % of the common stock.
The investor group has provided substantial financing to Valion Bio through several instruments: a senior secured convertible note with an original principal amount of $16,253,147.10 and related warrants for up to 4,553,213 shares at $2.2310 per share; purchases of Series B and Series C preferred stock with associated warrants; and an equity line of credit allowing Valion Bio to sell up to $50,000,000 of common stock to Tumim Stone. As of July 28, 2026, the company has sold 129,000 shares to Tumim Stone under the equity line at an average price of $0.5355 per share, and Tumim Stone has resold 526,770 shares at an average price of $0.7104 per share. The investors describe their holdings as for investment but note they may engage with Valion Bio’s board and other shareholders and, in a July 29, 2026 letter, 3i, LP demanded the immediate removal of chief executive officer Michael Handley and the start of a search for his replacement.
Valion Bio, Inc. is calling an August 14, 2026 virtual special meeting to ask common stockholders to authorize its board to implement a reverse stock split of the common stock at a ratio between 1-for-5 and 1-for-50 within twelve months, and to approve a related adjournment proposal.
The board states that one main purpose is to help regain compliance with Nasdaq’s $1.00 minimum bid requirement after the stock traded below that level, creating delisting risk. Common shares outstanding were 4,151,259 as of July 7, 2026, versus 200,000,000 authorized. The split would not change authorized share counts, would round fractional shares up to a whole share, and would increase the pool of authorized but unissued shares, which the company notes could have anti-takeover and future dilution effects.
Valion Bio, Inc. is conducting a primary equity offering of up to 29,411,764 shares of common stock together with an equal number of Common Warrants, plus related pre-funded and placement agent warrants and underlying shares. The assumed combined price is $0.51 per share and Common Warrant, implying gross proceeds of $15,000,000 if fully subscribed, with estimated net proceeds of about $13.7 million after fees and expenses.
Common stock outstanding would rise from 4,151,259 shares before the transaction to up to 33,563,023 shares afterward, excluding existing options, warrants and convertible preferred stock, so new investors experience immediate dilution. The transaction is on a reasonable best efforts basis with no minimum amount and no escrow, so it may close even if substantially less than the maximum is sold.
Valion Bio has pivoted from bioelectronic devices to a late-stage biopharmaceutical focus around its TLR5 agonist Entolimod and second-generation candidate Entolasta, targeting Acute Radiation Syndrome and oncology-related indications. Management discloses substantial doubt about the company’s ability to continue as a going concern and expects to need significant additional capital even after this financing.
Valion Bio, Inc. has a significant shareholder group led by Murchinson Ltd. and related entities and individuals that, together with affiliated funds, may be deemed to beneficially own up to 440,242 shares of common stock, representing 9.99% of the class after applying a contractual ownership cap.
The position consists of currently held common shares plus additional shares that can be acquired within 60 days through conversion or exercise of Series C preferred stock, subject to a 9.99% “Blocker” that prevents the funds and their affiliates from exceeding 9.99% beneficial ownership. The 9.99% figure is calculated using 4,151,259 shares outstanding as of July 10, 2026 plus the shares issuable under the preferred stock within the Blocker limit. The reporting parties disclaim beneficial ownership beyond any pecuniary interest and report only shared, not sole, voting and dispositive power over these shares.