Form 4: HilleVax Merger Completes, Insiders Dispose Shares

Frazier Life Sciences X, L.P. and Patrick J. Heron disposed of HilleVax, Inc. common stock and restricted stock units following the company's merger with XRA 4 Corp. for $1.95 cash and a CVR per share.

Summary

• Reporting persons, including Frazier Life Sciences X, L.P. and Patrick J. Heron, disposed of HilleVax, Inc. common stock and restricted stock units.
• The disposition occurred on September 17, 2025, due to the consummation of a merger.
• HilleVax, Inc. merged with XRA 4 Corp., a wholly owned subsidiary of XOMA Royalty Corporation.
• Each share of HilleVax common stock was converted into the right to receive $1.95 in cash and one non-transferable contractual contingent value right (CVR).
• Frazier Life Sciences X, L.P. disposed of 8,535,337 shares of common stock.
• Patrick J. Heron's 17,199 restricted stock units vested and were canceled in exchange for the same cash and CVR consideration per underlying share.

Sentiment

Score: 7

Explanation: The completion of a merger provides a clear exit for investors with a cash component and potential upside from a CVR, which is generally positive for liquidity and certainty, though the fixed cash price might not satisfy all investors.

Positives

• The merger successfully completed, providing liquidity to former HilleVax shareholders.
• Shareholders received a cash payment of $1.95 per share, offering immediate value.
• Shareholders also received a non-transferable contractual contingent value right (CVR) per share, offering potential future value based on specific contingencies.

Negatives

• HilleVax, Inc. ceased to be an independent publicly traded entity.
• The fixed cash consideration of $1.95 per share might be below some investors' expectations or intrinsic value assessments.
• The contingent value right (CVR) is non-transferable, limiting its liquidity and immediate market value.

Risks

• The contingent value right (CVR) is non-transferable, which may limit its liquidity and the ability of holders to realize its value prior to any contingent payments.

Future Outlook

Former HilleVax shareholders will receive potential future value through non-transferable contractual contingent value rights (CVRs), which are tied to future events or milestones. HilleVax, Inc. will operate as a subsidiary of XOMA Royalty Corporation.

Management Comments

• Steve R. Bailey, CFO of FHMLS X, L.L.C., signed the filing on behalf of Frazier Life Sciences X, L.P., FHMLS X, L.P., FHMLS X, L.L.C., and as Attorney-in-Fact for Patrick J. Heron and James N. Topper.

Industry Context

The merger of HilleVax, Inc. into a subsidiary of XOMA Royalty Corporation reflects ongoing consolidation and strategic realignments within the biotechnology sector, where smaller companies are often acquired for their assets or pipelines. The use of CVRs is a common mechanism in biotech M&A to bridge valuation gaps and share future upside potential.

Comparison to Industry Standards

• The structure of the merger, including a cash component and a contingent value right (CVR), is a common approach in the biotechnology and pharmaceutical industries for acquisitions where future milestones or regulatory approvals are uncertain.
• Similar transactions involving CVRs have been observed in other biotech acquisitions, such as Celgene by Bristol-Myers Squibb (for ozanimod and liso-cel CVRs) or Allergan by AbbVie (for specific pipeline assets).
• The $1.95 cash per share, combined with a CVR, aligns with typical deal structures for companies at HilleVax's stage, where upfront cash provides immediate value while CVRs offer participation in potential future success.

Stakeholder Impact

• Shareholders: Received $1.95 cash per share and one non-transferable CVR per share, marking the end of their equity ownership in HilleVax.
• Company (HilleVax, Inc.): Ceased to be an independent public entity, becoming a subsidiary of XOMA Royalty Corporation.

Next Steps

• Former HilleVax shareholders will await potential payments related to the non-transferable contractual contingent value rights (CVRs).
• HilleVax, Inc. will be integrated into XOMA Royalty Corporation's operations.

Key Dates

Keywords

HilleVax, HLVX, Merger, Acquisition, Form 4, Insider Transaction, Beneficial Ownership, Frazier Life Sciences, XOMA Royalty, Contingent Value Right, CVR