The FDA cancelled one meeting. A $50 million company died. The drug still worked.
Kezar Life Sciences had a drug that worked. Zetomipzomib, its lead candidate, had shown clinically meaningful and durable steroid-sparing remissions in autoimmune hepatitis — a rare, debilitating liver disease with no approved treatment path. In October 2025, Kezar was waiting for a critical meeting with the FDA to finalize the design of its registrational trial. The agency canceled it without explanation.
Four months later, in February 2026, the meeting finally happened. The FDA agreed to an accelerated development plan. The science cleared the hurdle it was designed to clear. By then, it was too late.
Kezar had already begun winding down. Investors had fled. The company auctioned off its lab equipment and sold most of its office furniture. It kept one conference room set — chairs and a table — in case the FDA meeting ever happened. Last week, it announced it was being acquired by Aurinia Pharmaceuticals for roughly $50 million. The drug moves forward. The company does not.
"The FDA has always been inconsistent," said Chris Kirk, Kezar's CEO, who has worked in biotech for more than two decades. "But what I'm seeing now feels more stochastic and maybe even capricious. This isn't good for patients. It's definitely not good for the biotech ecosystem."
The acquisition price tells the story. Aurinia is paying $6.955 per share — a fraction of what a Phase 2-ready asset with positive FDA feedback typically commands. The deal includes a contingent value right, meaning the sellers only get additional payments if the drug performs. Aurinia's new CEO is Kevin Tang, who spent two years trying to acquire Kezar at substantially lower prices when its stock was depressed by clinical holds. He finally got it, at a moment of maximum distress.
Kezar is not an isolated case. Over the past year, FDA staff departures and what industry insiders describe as inconsistent decision-making have created a new layer of regulatory risk for small biotechs. Unlike large pharmaceutical companies with multiple programs and institutional investors who can weather delays, single-asset biotechs operate on financing rounds that have expiration dates. A four-month pause is not an inconvenience for these companies — it is a death sentence dressed as a scheduling conflict.
The pattern is not new. What is new is the frequency. Biotech investors and executives alike describe a post-COVID shift in how the agency communicates timelines and expectations. The agency has attributed some disruptions to leadership transitions and a high volume of complex submissions. But for the 60 people Kezar employed, the explanation does not matter. The outcome is the same.
Whether the FDA's behavior in the Kezar case was specifically tied to broader political and leadership changes is unclear — STAT reported that the agency did not explain the cancellation. What is clear is that the drug worked, the company died, and the acquirer got a bargain. The patient did not benefit from the time that was lost.
That is the part of the story that does not show up in the deal math.
