Alaunos acquires Velaris and raises $350m to pursue PAH pipeline

Alaunos Therapeutics has completed the acquisition of Velaris Therapeutics, a privately held biotech developing biologics for pulmonary arterial hypertension and related cardiopulmonary conditions. The deal closed alongside an oversubscribed $350 million Series C convertible preferred stock private placement, which the company says will fund operations into 2029.

The financing was led by Fairmount, with participation from Venrock Healthcare Capital Partners, T. Rowe Price Investment Management, Wellington Management, Janus Henderson Investors, BB Biotech, Perceptive Advisors and several other institutional investors. Peter Harwin, Founding Partner of Fairmount, will join the Alaunos board of directors, with Fairmount ultimately designated to control four of the five board seats following a planned stockholder vote on conversion of the preferred stock.

The pipeline

Velaris brings a portfolio of four candidates, all targeting signalling imbalances that drive pulmonary vascular remodelling. The lead programme, VLR199, is an ActRIIA-Fc ligand trap designed to replicate and improve on the pharmacology of the only currently approved activin-signalling inhibitor for PAH. Two further ActRII-Fc ligand traps, VLR247 and VLR258, are engineered to spare the BMP-9 and BMP-10 ligands, which have been associated with haematologic adverse events seen with existing activin inhibitors. The fourth asset, VLR360, is an anti-PDGF-B monoclonal antibody targeting a complementary signalling pathway and is intended for use either as a monotherapy or in combination with the ActRII-Fc compounds.

Clinical proof-of-concept data for VLR199 is expected in 2028. Initial regulatory filings for VLR247 and VLR258 are also anticipated within the current funding window. The company is additionally targeting secondary pulmonary hypertension indications, including PH associated with heart failure with preserved ejection fraction and interstitial lung disease, both of which it says share the growth signalling imbalances seen in PAH.

Michael Henderson, President of Velaris, said the company had "built a capital-efficient plan to rapidly achieve proof-of-concept in PAH and demonstrate value," pointing to mounting evidence that effective PAH therapies show utility in secondary PH indications as well.

Market context

PAH is a rare but life-threatening progressive disease for which treatment options remain limited and long-term outcomes poor despite the availability of several approved vasodilatory agents. The activin-signalling pathway has attracted significant industry attention following the clinical validation of sotatercept, approved by the FDA in early 2024 and developed by Merck following its acquisition of Acceleron Pharma. Velaris is explicitly positioning VLR199 as a next-generation alternative to sotatercept, with its BMP-sparing variants designed to address the haematologic tolerability issues that have emerged in real-world use of the first-generation agent.

Paragon Laboratories, founded by Fairmount, is the source of the Velaris assets and has now launched nine companies based on its biologics discovery engine. That track record will be important context for investors assessing the credibility of the platform, though the pipeline remains pre-proof-of-concept and the 2028 data readout for VLR199 is a multi-year horizon.

For Alaunos, the transaction represents a significant strategic pivot. The company had been advancing ALN1003, an oral small-molecule candidate for obesity and metabolic disorders, as its principal programme. The relationship between that asset and the newly acquired cardiopulmonary portfolio was not addressed in the announcement, and investors will likely seek clarity on resource allocation and corporate focus ahead of the stockholder meeting on preferred stock conversion.