- Building on the successful beta launch of its first product
Plenity®, Gelesis aims to transform weight management. Gelesis
developed a novel biomimetic therapeutic platform that has yielded
Plenity and an advanced pipeline of therapeutic candidates for a
range of other gut-related disorders
- Plenity makes it easier to eat less and feel fuller with
smaller portions and offers a new weight management solution for
over 150 million Americans, many of whom did not have a
prescription alternative before. Plenity is FDA-cleared to aid in
weight management in adults with excess weight or obesity, Body
Mass Index (BMI) of 25 to 40 kg/m², when used in conjunction with
diet and exercise
- Pro forma implied market value of approximately $1.3 billion
and enterprise value of approximately $1.0 billion
- Transaction is expected to provide Gelesis with up to $376
million of gross proceeds to fund the full commercial launch of
Plenity later this year and to expand manufacturing to meet demand,
including $100 million from a common stock PIPE financing at $10.00
per share anchored by new and existing top tier investors and
partners, including PIMCO private funds, Kennedy Lewis Investment
Management, Pritzker Vlock Family Office, China Medical Systems
Holdings Limited (CMS), and co-founder PureTech Health
Gelesis, Inc. (“Gelesis” or the “Company”), a biotherapeutics
company advancing biomimetic superabsorbent hydrogels to treat
excess weight and metabolic disorders, and Capstar Special Purpose
Acquisition Corp. (NYSE: CPSR) (“Capstar”), a special purpose
acquisition company sponsored by affiliates of Capstar Partners,
LLC and certain private funds managed by PIMCO, announced today
that they have entered into a definitive business combination
agreement. Upon completion of the transaction, the combined
company’s securities are expected to be traded on the New York
Stock Exchange (NYSE) under the symbol “GLS.”
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the full release here:
https://www.businesswire.com/news/home/20210719005350/en/
Plenity® makes it easier to eat less and
feel fuller with smaller portions and offers a new weight
management solution for over 150 million Americans, many of whom
did not have a prescription alternative before. (Photo: Business
Wire)
A New Approach to Weight Management
Gelesis is a biotherapeutics company aiming to transform weight
management using a proprietary biomimetic superabsorbent hydrogel
technology. The Company’s first commercial product, Plenity®, is a
U.S. Food and Drug Administration (FDA) cleared aid in weight
management in adults with excess weight or obesity, Body Mass Index
(BMI) of 25 to 40 kg/m², when used in conjunction with diet and
exercise. Plenity has the broadest BMI range of any prescription
weight-management aid to date—over 150 million American adults
could be eligible for treatment with Plenity, many of whom did not
have a prescription alternative before. Plenity’s unique scientific
approach and efficacy, safety and tolerability profile allow
Gelesis to bring it to market in a completely new way.
Plenity capsules contain a non-systemic biomimetic hydrogel that
is not absorbed but instead acts locally in the gastrointestinal
(GI) tract. The capsules are taken with water before meals and are
designed to help people feel satisfied with smaller meals. Plenity
combines the simplicity and convenience of a consumer product with
clinical and scientific validation as well as FDA regulatory
clearance as a de novo Class II medical device. In clinical
studies, ~6 out of 10 adults had clinically meaningful weight loss
and those people lost on average, within six months, ten percent of
their body weight (about 22 lbs). There was no difference in
overall side effects compared to placebo. The most common side
effects were diarrhea, distended abdomen, infrequent bowel
movements and flatulence.
Plenity is a prescription product with a direct-to-patient
approach, giving the consumer the option of going through leading
telehealth platform Ro, or through an in-person healthcare provider
visit. This makes it easier for consumers to seek free physician
evaluation on their own time and their own terms. If prescribed,
the product is delivered to the consumer’s home within two days at
a transparent cost of $98/month, or $1.75 per meal.
Plenity is now available in limited release, and over 48,000
members have begun their weight management journey. During
Plenity’s beta launch in October 2020, with limited promotion and
without brand awareness marketing, Plenity surpassed all branded
prescription weight management products in new monthly members
during the month of testing, with high satisfaction ratings. The
Company anticipates the full commercial launch of Plenity later in
2021 and is currently constructing a larger manufacturing facility
to meet anticipated demand.
Gelesis’ novel platform technology is inspired by the structural
and mechanical properties of raw vegetables. When consumed, the
hydrogel forms small solid gel pieces in the stomach consisting of
water held by a 3D cellulose structures, similar to raw vegetables.
The structures, which have no calories, are homogeneously mixed
with the ingested foods, increasing the volume and firmness of that
meal while reducing its caloric density. The hydrogel pieces are
not absorbed and partially degrade in the large intestine,
releasing the water before leaving the body naturally. In clinical
trials, this therapeutic approach demonstrated a strong efficacy
and safety profile.
Management Comments
“We are delighted to have found such a stellar group of partners
and investors as we expand the launch of the first and only
FDA-cleared and clinically validated prescription aid for weight
management that is available for the broadest range of the
population with excess weight, including even those who are
overweight without co-morbidities,” said Yishai Zohar, Founder and
CEO of Gelesis. “Capstar’s leadership team has a track record of
successfully building known brands and tackling fundamental
consumer problems across a variety of industries. We look forward
to building on the exciting momentum of our beta launch with this
partnership and funding, and we are committed to making a
meaningful difference in the lives of millions of Americans seeking
scientifically proven and convenient options to manage their
weight.”
"Yishai and the Gelesis team have developed a tremendous
solution that is poised to transform the weight management
industry," said Steve Hicks, the Chairman and CEO of Capstar. "We
raised our Capstar SPAC last year with the goal of finding a
high-growth, disruptive business that is helping people live a
better, healthier life. Gelesis fits that criteria perfectly and we
are elated to partner with them as they start their exciting next
leg of growth."
Transaction Overview
The transaction values the combined company at an implied
enterprise value of approximately $1.0 billion and equity value of
approximately $1.3 billion, based on a $10.00 per share price of
Capstar common stock and assuming no redemptions by Capstar’s
public shareholders. The transaction will provide up to $376
million in gross proceeds to the combined company from a
combination of a $100 million common stock PIPE financing at $10.00
per share along with $276 million of cash held in Capstar’s trust
account (assuming no redemptions by Capstar’s public shareholders).
The PIPE financing is anchored by a mix of new and existing top
tier investors and partners, including PIMCO private funds,
Pritzker Vlock Family Office, China Medical Systems Holdings
Limited (CMS), and co-founder PureTech Health. Kennedy Lewis
Investment Management will invest $10 million in the PIPE
conditioned upon the closing of their $100 million senior secured
credit facility to the Company, which is subject to the completion
of due diligence, final documentation, and customary closing
conditions. Proceeds from the business combination, PIPE, and
credit facility will be primarily used to support the full
commercial launch of Plenity for weight management later this year
and expanded manufacturing to meet consumer demand. Gelesis’
existing shareholders will convert 100% of their ownership stakes
into the new company.
The transaction has been unanimously approved by the Boards of
Directors of both Gelesis and Capstar. It is expected to close in
the fourth quarter of 2021, subject to the satisfaction of certain
closing conditions, including a registration statement being
declared effective by the U.S. Securities and Exchange Commission
(the “SEC”) and the approval of Capstar shareholders.
Additional information about the transaction, including a copy
of the business combination agreement and investor presentation,
will be provided in a Current Report on Form 8-K to be filed by
Capstar with the SEC and available at www.sec.gov.
Advisors
Citi is serving as exclusive financial advisor to Gelesis and
Goodwin Procter LLP is serving as legal counsel to Gelesis. UBS
Investment Bank is serving as exclusive financial and lead capital
markets advisor to Capstar and Kramer Levin Naftalis & Frankel
LLP is serving as its legal counsel. UBS Investment Bank and Citi
are serving as private placement agents to Capstar with respect to
the PIPE financing. Winston & Strawn LLP served as counsel to
the placement agents. BTIG, LLC is also serving as a capital
markets advisor to Capstar.
Conference Call Information
Gelesis and Capstar will host a joint investor conference call
to discuss the transaction today, July 19, 2021, at 8:30 a.m.
Eastern Time. A telephone replay of the call will be available
until July 29, 2021 via the same numbers, and a replay of the
webcast will be archived on the investor relations website.
The conference call can be accessed via webcast on Gelesis’
investor relations website at gelesis.com/investors, or by dialing
+1 844-512-2921 within the U.S. or +1 412-317-6671 for
international callers and entering the passcode 1145464.
Important Safety Information
- Patients who are pregnant or are allergic to cellulose, citric
acid, sodium stearyl fumarate, gelatin, or titanium dioxide should
not take Plenity.
- To avoid impact on the absorption of medications:
- For all medications that should be taken with food, take them
after starting a meal.
- For all medications that should be taken without food (on an
empty stomach), continue taking on an empty stomach or as
recommended by your physician.
- The overall incidence of side effects with Plenity was no
different than placebo. The most common side effects were diarrhea,
distended abdomen, infrequent bowel movements, and flatulence.
- Contact a doctor right away if problems occur. If you have a
severe allergic reaction, severe stomach pain, or severe diarrhea,
stop using Plenity until you can speak to your doctor.
Rx Only. For the safe and proper use of Plenity or more
information, talk to a healthcare professional, read the Patient
Instructions for Use, or call 1-844-PLENITY.
About Gelesis
Gelesis is a consumer-centered biotherapeutics company advancing
a novel category of treatments for weight management and gut
related chronic diseases. Our non-systemic superabsorbent hydrogels
are inspired by the composition (i.e., water & cellulose) and
mechanical properties (e.g., elasticity or firmness) of raw
vegetables. They are conveniently administered in capsules to
create a much larger volume of small, non-aggregating hydrogel
pieces that become an integrated part of the meals, and act locally
in the digestive system. Our portfolio includes Plenity®, an
FDA-cleared product to aid in weight management, as well as
potential therapies in development for Type 2 Diabetes,
Non-alcoholic Fatty Liver Disease (NAFLD)/Non-alcoholic
Steatohepatitis (NASH), and Functional Constipation. For more
information, visit gelesis.com, or connect with us on Twitter
@GelesisInc.
About Capstar Acquisition Corp.
Capstar Special Purpose Acquisition Corp. (NYSE: CPSR) is
sponsored by Capstar Sponsor Group, LLC, and is led by Chairman and
CEO, R. Steven Hicks. Capstar is a special purpose acquisition
company formed for the purpose of effecting a business combination
with one or more businesses in the consumer, healthcare and
technology, media and telecom industry (TMT) sectors.
Additional Information and Where to Find It
Capstar intends to file a Registration Statement on Form S-4
with the SEC, which will include a proxy statement/prospectus, that
will be both the proxy statement to be distributed to Capstar
shareholders in connection with its solicitation of proxies for the
vote by Capstar shareholders with respect to the proposed business
combination and other matters as may be described in the
Registration Statement, as well as the prospectus relating to the
issuance of certain securities to be issued in the proposed
business combination. After the Registration Statement is declared
effective, the proxy statement/prospectus and other relevant
documents will be sent to Capstar and Gelesis shareholders. Capstar
also will file other documents regarding the proposed transaction
with the SEC. This press release does not contain all the
information that should be considered concerning the proposed
business combination and is not intended to form the basis of any
investment decision or any other decision in respect of the
proposed business combination. Before making any voting decision,
Capstar’s shareholders and other interested persons are advised to
read, when available, the preliminary proxy statement/prospectus
included in the Registration Statement, the amendments thereto and
the definitive proxy statement/prospectus and all other relevant
documents filed or that will be filed with the SEC in connection
with the proposed transaction as they become available because they
will contain important information about Gelesis, Capstar and the
proposed transaction.
When available, the definitive proxy statement/prospectus and
other relevant materials for the proposed business combination will
be mailed to shareholders of Capstar as of a record date to be
established for voting on the proposed business combination.
Investors and security holders will also be able to obtain free
copies of the Registration Statement, the proxy
statement/prospectus and all other relevant documents filed or that
will be filed with the SEC by Capstar, without charge, once
available, through the website maintained by the SEC at
www.sec.gov.
The documents filed by Capstar with the SEC also may be obtained
free of charge at Capstar’s website at www.capstarspac.com, or by
written request to: Capstar Special Purpose Acquisition Corp., 405
West 14th Street, Austin, TX 78701, Attention: R. Steven Hicks,
Chief Executive Officer, (512) 340-7800.
Participants in the Solicitation
Capstar and its directors and executive officers may be deemed
participants in the solicitation of proxies from Capstar’s
shareholders with respect to the proposed business combination. The
names of those directors and executive officers and a description
of their interests in Capstar is contained in Capstar’s final
prospectus dated July 6, 2020 relating to its initial public
offering and in subsequent filings with the SEC, which are
available free of charge at the SEC’s web site at www.sec.gov. To
the extent such holdings of Capstar’s securities may have changed
since that time, such changes have been or will be reflected on
Statements of Changes in Beneficial Ownership on Form 4 filed with
the SEC. Additional information regarding the interests of such
participants will be contained in the proxy statement/prospectus
for the proposed business combination when available.
Gelesis and its directors and executive officers may also be
deemed to be participants in the solicitation of proxies from the
shareholders of Capstar in connection with the proposed business
combination. A list of the names of such directors and executive
officers and information regarding their interests in the proposed
business combination will be included in the proxy
statement/prospectus for the proposed business combination when
available.
Forward-Looking Statements
Certain statements, estimates, targets and projections in this
press release may constitute “forward-looking statements” within
the meaning of the federal securities laws. The words “anticipate,”
“believe,” continue,” “could,” “estimate,” “expect,” “intend,”
“may,” “might,” “plan,” “possible,” “potential,” “predict,”
“project,” “should,” “strive,” “would” and similar expressions may
identify forward-looking statements, but the absence of these words
does not mean that statement is not forward looking.
Forward-looking statements are predictions, projections and other
statements about future events that are based on current
expectations and assumptions and, as a result, are subject to risks
and uncertainties. Forward-looking statements include, but are not
limited to, statements regarding the satisfaction of closing
conditions to the proposed business combination and the expected
timing of the completion of the proposed business combination, the
benefits of the proposed business combination, the competitive
environment in which Gelesis operates, the expected future
operating and financial performance and market opportunities of
Gelesis and statements regarding Gelesis’ and Capstar’s
expectations, hopes, beliefs, intentions or strategies regarding
the future,. In addition, any statements that refer to projections,
forecasts, or other characterizations of future events or
circumstances, including any underlying assumptions, are
forward-looking statements. Forward-looking statements speak only
as of the date they are made. Readers are cautioned not to put
undue reliance on forward-looking statements, and Gelesis and
Capstar assume no obligation and do not intend to update or revise
these forward-looking statements, whether as a result of new
information, future events, or otherwise. Gelesis and Capstar give
no assurance that any expectations set forth in this press release
will be achieved. Various factors could cause actual future
results, performance or events to differ materially from those
described herein. Some of the factors that may impact future
results and performance may include, without limitation: (i) the
size, demand and growth potential of the markets for Plenity®,
Gelesis’ other product candidates and its ability to serve those
markets; (ii) the degree of market acceptance and adoption of
Gelesis’ products; (iii) Gelesis’ ability to develop innovative
products and compete with other companies engaged in the weight
loss industry; (iv) Gelesis’ ability to complete successfully the
full commercial launch of Plenity® and its growth plans, including
new possible indications and the clinical data from ongoing and
future studies about liver and other diseases; (v) the inability of
the parties to successfully or timely consummate the proposed
business combination, including the risk that any required
regulatory approvals are not obtained, are delayed or are subject
to unanticipated conditions that could adversely affect the
combined company or the expected benefits of the business
combination or that the approval of the shareholders of Capstar is
not obtained; (vi) the inability of Gelesis to obtain the secured
financing from Kennedy Lewis Investment Management; (vii) failure
to realize the anticipated benefits of the business combination,
including as a result of a delay or difficulty in integrating the
businesses of Capstar and Gelesis; (viii) the amount of redemption
requests made by Capstar shareholders; (ix) the ability of Capstar
or the combined company to issue equity or equity-linked securities
or obtain debt financing in connection with the proposed business
combination or in the future; (x) the outcome of any legal
proceedings that may be instituted against Capstar, Gelesis, the
combined company or others following the announcement of the
proposed business combination and any definitive agreements with
respect thereto; (xi) the ability to meet stock exchange listing
standards at or following the consummation of the proposed business
combination; (xii) the risk that the proposed business combination
disrupts current plans and operations of Gelesis as a result of the
announcement and consummation of the proposed business combination,
and as a result of the post-transaction company being a publicly
listed issuer; (xiii) the regulatory pathway for Gelesis’ products
and responses from regulators, including the FDA and similar
regulators outside of the United States, (xiv) the ability of the
combined company to grow and manage growth profitably, maintain
relationships with customers and suppliers and retain Gelesis’
management and key employees; (xv) costs related to the proposed
business combination, including costs associated with the
post-transaction company being a publicly listed issuer; (xiv)
changes in applicable laws or regulations; (xvi) the possibility
that Gelesis or the combined company may be adversely affected by
other economic, business, regulatory and/or competitive factors;
(xvii) Gelesis’ estimates of expenses and profitability; (xviii)
ongoing regulatory requirements, (xix) any competing products or
technologies that may emerge, (xx) the volatility of the telehealth
market in general, or insufficient patient demand; (xxi) the
ability of Gelesis to defend its intellectual property and satisfy
regulatory requirements; (xxii) the impact of the COVID 19 pandemic
on Gelesis’ business; (xxiii) the limited operating history of
Gelesis; and (xxiv) those factors discussed in Capstar’s final
prospectus dated July 6, 2020 and Annual Report on Form 10-K for
the fiscal year ended December 31, 2020 and the Registration
Statement, in each case, under the heading “Risk Factors” and other
documents of Capstar filed, or to be filed, with the SEC, including
the proxy statement/prospectus on Form S-4 relating to the proposed
business combination, which is expected to be filed by Capstar with
the SEC. These filings address other important risks and
uncertainties that could cause actual results and events to differ
materially from those contained in the forward-looking
statements.
Non-Solicitation
This press release relates to a proposed transaction between
Gelesis and Capstar. This press release is not a proxy statement or
solicitation of a proxy, consent or authorization with respect to
any securities or in respect of the proposed business combination
and shall not constitute an offer to sell or a solicitation of an
offer to buy the securities of Capstar, the Company or the combined
company, nor shall there be any sale of any such securities in any
state or jurisdiction in which such offer, solicitation, or sale
would be unlawful prior to registration or qualification under the
securities laws of such state or jurisdiction. No offer of
securities shall be made except by means of a prospectus meeting
the requirements of the Securities Act of 1933, as amended.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210719005350/en/
Investor Relations Lynne Collier, ICR
lynne.collier@icrinc.com
Media Relations Katie Sullivan ksullivan@gelesis.com
Capstar Benjamin Hanson ben@eqcapstrategies.com
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