aibioRallybio to receive $50,000,000 fee after Candid ends merger
Tickers RLYB
Candid terminated its merger agreement with Rallybio on May 3, 2026, and entered into a Permitted Alternative Agreement with UCB S.A. Rallybio intends to withdraw its Form S-4 registration statement.
Key facts
- Company
- Rallybio Corporation (NASDAQ: RLYB)
- News type
- Mergers
- Primary source
- Rallybio Corporation 8-K (2026-05-04)
Rallybio Corporation (NASDAQ: RLYB) said in a Form 8-K filed on May 4, 2026, that its merger agreement with Candid Therapeutics, Inc. has ended. Candid terminated the Agreement and Plan of Merger and Reorganization on May 3, 2026, the same day it entered into a Permitted Alternative Agreement with UCB S.A. As a result, Rallybio is entitled to receive a $50,000,000 Parent Termination Fee under the merger agreement, which the filing says Rallybio is entitled to receive.
The waiver
Rallybio, Candid and UCB entered into a waiver dated May 1, 2026, filed as Exhibit 2.1 to the 8-K. Under the waiver, Rallybio waived certain rights under the merger agreement and the Company Stockholder Support Agreement relating to the Company Determination Notice and the Company Notice Period. Rallybio also agreed that Candid could pay the Parent Termination Fee and reimburse certain expenses on the first business day after the termination.
Once Rallybio receives that fee and expense reimbursement, it agreed to release all claims against Candid, UCB and their affiliates connected to the merger agreement or its termination. Rallybio intends to withdraw its registration statement on Form S-4, which it first filed with the SEC on March 17, 2026, and amended on April 24, 2026. The 8-K was signed by Jonathan I. Lieber, Chief Financial Officer and Treasurer.
The terminated merger
The merger agreement, dated March 1, 2026, provided that Farmington Merger Sub, Inc., a wholly owned subsidiary of Rallybio, would merge with and into Candid, with Candid surviving as a wholly owned subsidiary. Rallybio's annual report for 2025, filed March 16, 2026, describes Candid as a clinical-stage biotechnology company advancing T-cell engager therapeutics for autoimmune diseases.
Certain investors had agreed to buy Candid shares in a concurrent financing with an aggregate commitment of approximately $505.5 million. The annual report gave expected ownership of the combined company of about 57.55% for pre-merger Candid equityholders other than concurrent financing investors, about 3.65% for pre-merger Rallybio equityholders and about 38.80% for the concurrent financing investors. Those figures used a valuation of $47.5 million for Rallybio and a fixed valuation of $750.0 million for Candid.
Before the merger, Rallybio planned to create a contingent value right for each outstanding share, prefunded warrant, restricted stock unit and in-the-money parent option. Each right would give its holder a pro rata share of proceeds from Rallybio's pre-merger assets, called the Legacy Assets, and any cash received from Recursion Pharmaceuticals, Inc. under a membership interest purchase agreement dated July 8, 2025.
What the company does
Rallybio describes itself as a clinical-stage biotechnology company focused on severe and rare diseases. Its lead program, RLYB116, is a differentiated complement component 5 (C5) inhibitor with the potential to treat diseases of complement dysregulation. The company also has RLYB332, a long-acting matriptase-2 (MTP-2) antibody for diseases of iron overload, which the annual report says is in preclinical development.
Financial position
Rallybio reported revenue of $858,000 for the fiscal year ended December 31, 2025, compared with $636,000 for 2024. Research and development expense was $19.6 million in 2025, compared with $41.5 million in 2024. The company reported a net loss of $9.0 million for 2025 and $57.8 million for 2024.
Operating activities used $29.8 million of cash in 2025 and $49.3 million in 2024. At the end of 2024, Rallybio held $13.9 million in cash and cash equivalents and $51.6 million in short-term investments.
The risks ahead
The deal that would have taken Rallybio into a combined company with Candid is over, and the 8-K describes no other transaction. Rallybio still has to receive the $50,000,000 fee and expense reimbursement, which the filing says could be paid on the first business day after termination, and it releases its claims only if that payment arrives. Its annual report shows a company still spending: operating activities used $29.8 million of cash in 2025 and R&D was $19.6 million. The report also describes RLYB332 as preclinical. The 8-K gives no plan for the company after the withdrawn S-4.