Why Sesen Bio (SESN) Shares Are Plunging Today

Sesen Bio Inc SESN and privately held Carisma Therapeutics Inc have entered into a merger agreement to combine the companies in an all-stock transaction.
The combined company will operate under the Carisma Therapeutics moniker under the "CARM symbol" and is expected to have approximately $180 million of cash and cash equivalents, including $30 million from concurrent financing by Carisma, which is expected to fund the company through 2024.
Sesen Bio suffered FDA rejection for its lead product Vicineum, for non-muscle invasive bladder cancer. In July, Sesen stopped developing the product and started looking for alternatives.
Carisma recently entered into a strategic partnership with Moderna Inc MRNA for in vivo CAR-M therapies for up to 12 targets for cancer.
Carisma received a $45 million up-front cash payment and an investment by Moderna in the form of a $35 million convertible note.
Under the collaboration, Carisma will receive full research funding and is eligible to receive milestone payments plus sales royalties.
Carisma has also partnered with Novartis AG NVS to operate as Carisma's contract manufacturing organization for the clinical supply of its lead clinical program, CT-0508.
Price Action: SESN shares are down 39.20% at $0.41 on the last check Wednesday.