Entering text into the input field will update the search result below

Kezar Life Sciences: Key Catalysts Ahead

May 07, 2020 12:37 PM ETKezar Life Sciences, Inc. (KZR)5 Comments


  • Kezar Life Sciences, Inc. is down some 70% since its lone clinical asset, autoimmune fighter KZR-616, underwhelmed the Street with a Phase 1b readout in May 2019.
  • As such, it was compelled to raise cash at $2.60 a share in late January 2020 after it IPO’d at $15 in June 2018, doubling the number of shares outstanding.
  • Three Phase 2 trials will decide the company’s fate with the first interim readout due 4Q20.
  • With a first-in-class molecule for underserved indications and significant insider buying, this busted IPO merited further investigation.
  • An investment analysis is provided in the paragraphs below.
  • I do much more than just articles at The Busted IPO Forum: Members get access to model portfolios, regular updates, a chat room, and more. Get started today »

A civilization is not destroyed by wicked people; it is not necessary that people be wicked but only that they be spineless." - James Baldwin

Today, we take an in-depth look at a 'Busted IPO' whose stock has behaved better of late. This concern has several important trial milestones on the horizon. A full analysis follows in the paragraphs below.

Company Overview

Kezar Life Sciences, Inc. (NASDAQ:KZR) is a South San Francisco-based clinical-stage biotechnology concern focused on developing therapeutics to treat autoimmune diseases. The company has one asset in the clinic, KZR-616, which is being investigated in three Phase 2 trials for five autoimmune indications. Kezar was founded in 2015 and went public in June 2018, raising net proceeds of $77.6 million at $15 per share. After executing a secondary in early February at $2.60 a share, the shares have roughly doubled and sport an approximate $200 million market cap currently.


The company's only clinical asset is KZR-616, a small molecule selective immunoproteasome inhibitor. Currently approved proteasome inhibitor therapies have demonstrated activity in the treatment of autoimmune diseases but are non-selective, which results in immunosuppression and consequent systemic toxicities and peripheral neuropathy. So far, in Phase 1 studies, KZR-616 has largely avoided those adverse effects, posting low infection rates.

Source: Company Presentation

Proteasomes regulate intracellular protein degradation and play a vital role in cell division, cell differentiation, and cytokine production. There are two types of proteasomes: constitutive, which are predominant in tissue cells, and immunoproteasome, which are found in immune system cells. They perform similar functions but utilize different active sites. There are three approved proteasome inhibitors for the treatment of multiple myeloma: Takeda's (TAK) Velcade, Amgen's (AMGN) Kyprolis, and generic Ninlaro. These are all dual inhibitors of both the immunoproteasome and the constitutive proteasome, which make

Author's note: I present and update my best small-cap Busted IPO stock ideas only to subscribers of my exclusive marketplace, The Busted IPO Forum. To become a member of our growing community, just click on the logo below

This article was written by

Busted IPO Forum profile picture

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in KZR over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (5)

Sketlux profile picture
@Busted IPO Forum
"The stock dropped 41% on the preliminary data released May 28, 2020, and has continued its downward spiral since, now down 78% overall."
I assume you are talking about May 28, 2019
Yes indeed, check the Stock graph above
Busted IPO Forum profile picture
What? You don't think I can see the future? :-). Thanks for the catch, has been corrected.
NDHT profile picture
I'm just happy to see someone still remembers Kezar and is willing to write something about it, which, I admit, has been forgotten.
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.