After four patient deaths, Kezar’s lupus trial is officially on hold, sparking investor Kevin Tang’s interest for acquisition.
After four patient deaths paused its lupus study, Kezar Life Sciences is now being courted for buyout by Concentra Biosciences. Kevin Tang, CEO of Concentra’s parent company Tang Capital Management, sent an offer for Concentra to scoop the biotech up for $1.10 a share in cash on Tuesday.
Tang Capital Management, Tang Capital Partners, and Tang himself each own 9.9% Kezar’s shares already.
Kezar hit rocky waters last week when the company announced four patients died in the Phase IIb PALIZADE trial testing the company’s lead candidate, an immunoproteasome inhibitor dubbed zetomipzomib, in patients with active lupus nephritis. According to the company, three of the four deaths demonstrated a “common pattern of symptoms and proximity to dosing.”
Last Monday, Kezar voluntarily paused enrollment and dosing of the mid-stage study, per the recommendations of an independent data monitoring committee. The FDA then issued a formal clinical hold. At this time, the Phase IIa PORTOLA trial of zetomipzomib in autoimmune hepatitis has not been affected. No grade 4 or serious adverse events have been documented in PORTOLA.
While analysts at the time believe the totality of the data for zetomipzomib highlight a favorable safety profile, the trial pause is certainly a setback—one that investor Tang is ready to pounce on.
Kezar’s stock closed trading Tuesday at 74 cents, having not traded over $1 since early spring. Current shareholders would receive a contingent value right of 80% of the proceeds from the out-licensing or sale of any of Kezar’s programs. Tang’s offer of $1.10 per share sent the stock up over 20% Wednesday morning.
“Concentra has funds immediately available to execute this transaction,” Tang’s offer letter said.
Tang specializes in buying out struggling biotech companies, with Concentra having acquired Theseus Pharmaceuticals last year after the company scrapped its lead drug over toxicity issues and laid off 72% of its staff.
More recently, last month Concentra made a bid to buy Singular Genomics, offering $12 a share for the multiomic discovery platform company.
