I am SO sorry! Grrrr! I agree with the poster above, I would get a really sharp (and heavy) pair of scissors and cut off the leather above the damage, at the same angle as the edge is now. I might even try the "cut" a few times across the damaged part to be sure I got a clean, sharp edge and the right angle. So sorry this happened to your beautiful bag!
Edited to add ... if I weren't a crafty person already and thought that might bug me (chopping it off!) I would contact coach about a repair and pay for that. It might bother me every time I used the bag to not have the pulls like they were supposed to be!
I'd do what the others are suggesting. First try snipping the leather pulls to get rid of kitty's chew toy. Lol. If you don't like the outcome then try checking with Coach about paying for a repair. It seems like they'd be able to do it. You'd be without your bag for a few weeks, but it would probably look good as new.
I agree about cutting them off, but you might want to re-seal them at the ends. If you don't want to try to seal them yourself, you could take the bag to coach or to a good cobbler and see what they say. It may be worth it to get coach to put new pulls on if they can/will do that at a decent price.
Remember that you love the kitty a lot more than you love the bag, right?
if you cut it, there may be exposed material that is between the leathers. I think it's definitely possible to try fixing yourself first before sending it in or cutting the tassels off all together.
If there is filling between the leather pieces that aren't glued together, you'll need glue (e-6000 is strong for leather). Apply it in between with a toothpick and squeeze together.
You can use acrylic paint to paint the edges to match the sealant they have on there too. I think you can buy leather edge paint but it may be harder to get (and may just be a type of acrylic anyway).