Kezar Life Sciences, Inc.

Kezar Life Sciences has agreed to be acquired by Aurinia Pharma U.S., Inc., a subsidiary of Aurinia Pharmaceuticals Inc., in a transaction valued at $6.955 per share in cash plus a contingent value right (CVR). The deal structure involves a two-step process: a cash tender offer for all outstanding shares, followed by a merger under Delaware's short-form merger statute, which does not require a stockholder vote if the tender condition is met. The transaction provides Kezar stockholders with immediate cash consideration and a CVR that offers potential additional value tied to the future development or monetization of Kezar's key assets, notably zetomipzomib, its immunoproteasome inhibitor in development for autoimmune diseases. The CVR payments are contingent on specific milestones, including clinical development progress, licensing or sale proceeds from legacy assets, and the realization of net cash above a $50 million threshold at closing. The Kezar board unanimously recommended the offer, citing a strategic review process. The agreement includes standard deal protections for Aurinia, such as a no-shop clause with fiduciary outs and a $1.2 million termination fee payable by Kezar under certain scenarios. Support from Tang Capital Partners, a significant stockholder, and the waiver of anti-takeover provisions through an amendment to Kezar's stockholder rights agreement facilitate the transaction's path to completion, which is anticipated in Q2 2026, pending customary closing conditions.