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Nature of Operations and Liquidity | 9 Months Ended
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Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Nature of Operations and Liquidity | 1. Nature of Operations and Liquidity Catalyst Biosciences, Inc. and its subsidiary (the “Company” or “Catalyst”) was a biopharmaceutical company with expertise in protease engineering. Prior to ceasing research and development activities in March 2022, the Company had several protease assets that were designed to address unmet medical needs in disorders of the complement or coagulation systems. The Company was located in South San Francisco, California during the quarter ended September 30, 2023 and operates in one segment. As discussed below, the Company recently completed a purchase agreement to acquire a clinical-stage drug candidate for the treatment of NASH (nonalcoholic steatohepatitis, a severe form of nonalcoholic fatty liver disease). Concurrent with this purchase agreement, the Company entered into a separate business combination agreement to acquire an indirect controlling interest in a China-based pharmaceutical company. On May 19, 2022, Catalyst entered into and closed on an asset purchase agreement with Vertex Pharmaceuticals Inc. (“Vertex”), pursuant to which Vertex acquired Catalyst’s complement portfolio, including CB 2782-PEG and CB 4332, as well as its complement-related intellectual property including the ProTUNE TM and ImmunoTUNE TM platforms. See Note 11, Restructuring. On February 27, 2023, Catalyst entered into and closed on an asset purchase agreement with GC Biopharma Corp. (“GCBP”), pursuant to which GCBP acquired Catalyst’s legacy rare bleeding disorder program, including the coagulation related assets marzeptacog alfa (activated) (“MarzAA”), dalcinonacog alfa (“DalcA”), and CB-2679d-GT. See Note 11, Restructuring. Reclassifications Prepaid insurance has been reclassified out of prepaid and other current assets to conform to the current period presentation in the accompanying notes. F351 Asset Acquisition and Series X Redeemable Convertible Preferred Stock On December 26, 2022, the Company executed and closed an Asset Purchase Agreement, which was amended on March 29, 2023 (the “F351 Agreement”), with GNI Group Ltd. (“GNI Japan”) and GNI Hong Kong Limited ("GNI Hong Kong") to purchase all of the assets and intellectual property rights primarily related to the proprietary Hydronidone compound (collectively, the “F351 Assets”), other than such assets and intellectual property rights located in the People’s Republic of China ("PRC"). At the closing of the agreement on December 26, 2022, the Company paid $35.0 million in the form of 6,266,521 shares of Catalyst common stock and 12,340 shares of newly designated Series X redeemable convertible preferred stock (“Catalyst Convertible Preferred Stock”). Each share of Catalyst Convertible Preferred Stock is convertible into 10,000 shares of common stock, subject to stockholder approval under Nasdaq rules and subject to a beneficial ownership conversion blocker. For additional information, see Note 3, F351 Asset Acquisition. At its 2023 Annual Meeting of Stockholders on August 29, 2023, the Company's stockholders approved the conversion of the Catalyst Convertible Preferred Stock into shares of the Company's common stock in accordance with Nasdaq Listing Rule 5635(a) (the "Conversion Proposal"), and approved an amendment to the Company's certificate of incorporation to authorize sufficient shares of common stock for the conversion of the Catalyst Convertible Preferred Stock issued pursuant to the F351 Agreement. Following stockholder approval of the Conversion Proposal, each share of Catalyst Convertible Preferred Stock is convertible at the option of the holder into 10,000 shares of the Company's common stock, subject to a beneficial ownership conversion blocker. Prior to stockholder approval of the Conversion Proposal, the terms of the Catalyst Convertible Preferred Stock included a cash redemption feature. Upon stockholder approval of the Conversion Proposal, the cash redemption feature was eliminated and the Catalyst Convertible Preferred Stock was reclassified to stockholders' equity. Business Combination Agreement Concurrent with the F351 Asset acquisition, the Company signed a definitive agreement, dated as of December 26, 2022, and as amended on March 29, 2023 and August 30, 2023, with GNI Japan, GNI Hong Kong, GNI USA, Inc. ("GNI USA"), Continent Pharmaceuticals Inc. and Shanghai Genomics, Inc. (collectively, “GNI”) and other minority stockholders to acquire an indirect controlling interest in Beijing Continent Pharmaceutical Co., Ltd. (“BC”), a commercial-stage pharmaceutical company based in China and a majority-owned subsidiary of GNI, in exchange for newly issued shares of common stock (the “Business Combination Agreement”). The closing of the transactions under the Business Combination Agreement are subject to stockholder approval and certain customary closing conditions. Catalyst stockholders approved the transactions under the Business Combination Agreement at the 2023 Annual Meeting of Stockholders on August 29, 2023, however, as of September 30, 2023 the transactions had not closed. On October 20, 2023, BC received approval from the China Securities Regulatory Commission ("CSRC") with respect to the business combination pursuant to the Business Combination Agreement. Catalyst and GNI anticipate the business combination will be completed by the Outside Date (as defined in the Business Combination Agreement). For additional information, see Note 8, Commitments and Contingencies. Contingent Value Rights Agreement Pursuant to the Business Combination Agreement, on December 26, 2022, Catalyst and the Rights Agent (as defined therein) executed a contingent value rights agreement, as amended on March 29, 2023 (the “CVR Agreement”), pursuant to which each holder of Catalyst common stock as of January 5, 2023, excluding GNI (the “CVR Holders”), received one contractual contingent value right (a “CVR”) issued by the Company for each share of Catalyst common stock held by such holder. Each CVR entitles the holder thereof to receive certain cash payments in the future. For additional information, see Note 8, Commitments and Contingencies. Liquidity On January 12, 2023, the Company paid a one-time cash dividend of $0.24 per share to the CVR Holders. The aggregate amount of the special dividend payment was approximately $7.6 million. On March 8, 2023, the Company distributed the net cash proceeds received from the GCBP asset sale of $0.2 million, or $0.01 per share, to the CVR Holders. See Note 11, Restructuring, for additional information regarding this distribution. On June 5, 2023, the Company distributed the net cash proceeds received from the Vertex hold-back amount of $3.5 million, or $0.11 per share, to the CVR Holders. See Note 11, Restructuring, for additional information regarding this distribution. On August 21, 2023, the Company distributed the remaining net cash proceeds received from the Vertex hold-back amount of $1.5 million, or $0.05 per share, to the CVR Holders. See Note 11, Restructuring, for additional information regarding this distribution. The Company had a net loss of $3.8 million for the nine months ended September 30, 2023. As of September 30, 2023, the Company had an accumulated deficit of $414.7 million and cash and cash equivalents of $2.2 million. Its primary uses of cash are to fund operating expenses and general and administrative expenditures. As part of the Business Combination Agreement, GNI agreed to share certain ongoing operating expenses incurred by the Company until the Business Combination Agreement closes. See Note 12, Related Parties, for additional information regarding this arrangement. The actual amount and timing of the cost sharing payments from GNI is outside of the control of the Company. Given the uncertainties related to the pending Business Combination Agreement, there is substantial doubt about the Company's ability to continue as a going concern for at least 12 months following the issuance of these condensed consolidated financial statements. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

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