Aurinia Pharmaceuticals to Acquire Kezar Life Sciences: Comprehensive Investor Update

Key Highlights

• Definitive Merger Agreement Signed: Aurinia Pharmaceuticals Inc. (NASDAQ: AUPH) will acquire Kezar Life Sciences, Inc. (NASDAQ: KZR) in a cash and Contingent Value Right (CVR) deal.
• Acquisition Price: Kezar shareholders will receive \$6.955 in cash per share plus one non-transferable CVR per Kezar share.
• CVR Details: The CVR entitles holders to potential additional payments relating to:
  • Ongoing clinical development or disposition of zetomipzomib
  • Proceeds from Kezar’s collaboration with Everest Medicines
  • Proceeds from the sale of Kezar’s Sec61-based discovery and development program to Enodia Therapeutics
  • 100% of Kezar’s closing net cash in excess of \$50 million, net of certain post-closing CVR-related expenses
• Transaction Timeline: Tender offer expected to commence by April 13, 2026, with transaction closing anticipated in Q2 2026.
• Board Approval and Shareholder Support: Kezar’s board unanimously approved the deal. Tang Capital Partners, LP (9% ownership of Kezar) has signed a tender and support agreement.
• Lead Asset – Zetomipzomib: A first-in-class immunoproteasome inhibitor for autoimmune hepatitis (AIH), lupus nephritis, and systemic lupus erythematosus (SLE). Recent positive Phase 2 AIH study results and constructive FDA interactions may accelerate development.
• Closing Conditions: Completion is subject to a majority of Kezar shares being tendered, Kezar’s closing net cash exceeding \$50 million, and other customary conditions.

Strategic and Financial Implications

Aurinia’s acquisition of Kezar is a potentially transformative event for both companies and their shareholders. Kezar shareholders receive a cash premium and further upside through the CVR, which is tied to future success of the company’s lead asset and other monetization events. The transaction may offer immediate liquidity and ongoing participation in zetomipzomib’s future value.

From a strategic standpoint, Aurinia is leveraging its expertise in autoimmune diseases (notably with its commercialized product LUPKYNIS® for lupus nephritis) to accelerate the development and potential commercialization of zetomipzomib. This acquisition broadens Aurinia’s clinical pipeline and strengthens its position in the autoimmune therapeutics space.

Material Considerations for Shareholders

• Immediate Liquidity and Upside: Cash payment of \$6.955 per share provides a concrete exit value, while the CVR offers exposure to future milestones and monetization events.
• CVR Uncertainty: The value of the CVR is contingent on future events, including regulatory progress, clinical outcomes, asset sales, and net cash levels at closing. There is no guarantee that any CVR payments will be made.
• Transaction Risks: Completion depends on meeting closing conditions such as a majority tender of shares, minimum net cash, and regulatory approvals. There is a risk the transaction may not close, which could negatively impact Kezar’s share price.
• Potential Competing Offers: The agreement acknowledges the possibility of other acquisition proposals, which could affect the transaction outcome and share price volatility.
• Shareholder Litigation: The announcement and pendency of the transaction may trigger shareholder or legal actions, possibly affecting the timing or certainty of completion.
• Price-Sensitive Events: Any updates regarding FDA interactions, clinical trial outcomes, or monetization of assets under the CVR will be highly relevant for share valuation.
• Offer Details: The tender offer and its terms will be detailed in forthcoming SEC filings (Schedule TO and Schedule 14D-9). Shareholders are advised to read all materials carefully once available.

About the Companies

• Aurinia Pharmaceuticals Inc.: A biopharmaceutical company focused on therapies for autoimmune diseases with high unmet needs. Its flagship product, LUPKYNIS® (voclosporin), is the first FDA-approved oral therapy for lupus nephritis. Aurinia is also developing aritinercept, a dual BAFF/APRIL inhibitor for autoimmune diseases.
• Kezar Life Sciences, Inc.: A clinical-stage biopharma company developing novel small molecules for immune-mediated diseases. Zetomipzomib, its lead program, has shown promise in AIH and other autoimmune conditions.

Next Steps for Shareholders

The tender offer has not yet commenced. Shareholders should await the official offer materials and carefully review all documents before making any decisions regarding the tendering of shares. These documents will be available on the SEC’s website and the investor relations sections of both companies’ websites.

Forward-Looking Statement Disclaimer

This article contains forward-looking statements, including potential transaction benefits, closing timelines, and future value of CVRs. These statements are subject to risks and uncertainties, such as failure to complete the transaction, regulatory hurdles, and future financial or clinical developments that could materially impact actual results. Investors should consult the official filings and disclosures of both companies before making investment decisions. This article is for informational purposes only and does not constitute an offer to buy or sell any securities.

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