$34.4 million in net revenue for the first
quarter of 2023; an increase of 59% over the first quarter of the
prior year
Increases 2023 revenue guidance range to $135 -
$155 million from net product sales of LUPKYNIS
Significant progress across Commercial, R&D
and Intellectual Property
Conference call to be hosted today at 8:30 a.m.
ET
Aurinia Pharmaceuticals Inc. (NASDAQ: AUPH) (Aurinia or the
Company) today issued its financial results for first quarter ended
March 31, 2023. Amounts are expressed in U.S. dollars.
Total net revenue was $34.4 million for the quarter ended March
31, 2023, compared to $21.6 million in the prior year quarter ended
March 31, 2022, representing significant growth of 59% year over
year. Total net product revenue was $34.3 million for the quarter
ended March 31, 2023, compared to $21.5 million in the prior year
quarter ended March 31, 2022.
“We are very pleased with our results in the first quarter of
2023 as it represents our most successful quarter to date,” said
Peter Greenleaf, President, and Chief Executive Officer of Aurinia.
“With our continued focus on commercial execution, we saw the
impact of our marketing and selling efforts directly in the
quarter. This, coupled with the recent release of the renal biopsy
data, and the newly issued method of use patent serve to further
substantiate LUPKYNIS in the LN market.”
For the fiscal year 2023, the Company is increasing its net
product revenue guidance to a range of $135 - $155 million from
$120 - $140 million for net product sales of LUPKYNIS. The guidance
range is based on assumptions regarding historical patient start
form (PSF) run rates, consistent conversion rates, time to convert,
persistency, and pricing.
First Quarter 2023 and Recent Highlights
- There were approximately 1,731 patients on LUPKYNIS therapy at
March 31, 2023, compared with 1,071 at March 31, 2022.
- Aurinia added 466 PSFs during the three months ended March 31,
2023, compared to 461 during the three months ended March 31, 2022,
and 406 in the three months ended December 31, 2022. An increase of
1% and 15%, respectively.
- Through Friday, April 28, 2023, the Company recorded 604 PSFs
since January 1, 2023.
- Conversion rates remain consistent with the prior quarter, with
approximately 85% of PSFs converted to patients on therapy.
- Time to conversion remains consistent with the prior quarter,
with 30- and 60-day conversion rates holding near their best levels
since launch; with the large majority (61%) of patients on therapy
by 20 days.
- Persistency rates at 12 months and 15 months improved over
prior periods, with approximately 51% and 47% remaining on therapy,
respectively. At 18 months post-treatment start, an average of
approximately 41% of patients remain on treatment.
- Announced promising top line results from the renal biopsy
sub-study of the AURORA trial demonstrating that LUPKYNIS-treated
patients showed histologic activity improvement with stable
chronicity scores similar to active control arm of mycophenolate
mofetil (MMF) and low dose steroids alone. These results have the
potential to further differentiate LUPKYNIS from first generation
calcineurin inhibitors, which are known to cause histologic kidney
changes over time.
- Received issuance of new and refined method of use patent (U.S.
Patent No. 11,622,991) for LUPKYNIS for an improved protocol for
the treatment of LN.
- Announced that Grammy Award winning singer Toni Braxton, who
has been living with lupus since 2008, is the new spokesperson for
our Get Uncomfortable patient campaign, which launched in October
2022.
- Released Aurinia’s inaugural Environmental, Social, and
Governance (ESG) report.
- Received a positive recommendation from The United Kingdom’s
National Institute for Health and Care Excellence (NICE) that
LUPKYNIS can be used in combination with MMF to treat patients with
LN.
- Received regulatory approval for LUPKYNIS in Switzerland.
Financial Results for the Three Months Ended March 31,
2023
Total net revenue was $34.4 million and $21.6 million for the
three months ended March 31, 2023 and March 31, 2022, respectively.
The increase is primarily due to an increase in net product revenue
from our two main customers for LUPKYNIS driven predominantly by
further penetration in the LN market.
Total cost of sales and operating expenses for the three months
ended March 31, 2023 and March 31, 2022 were $64.0 million and
$59.5 million, respectively. Further breakdown of operating expense
drivers and fluctuations are highlighted in the following
paragraphs.
Cost of sales were $0.4 million and $0.3 million for the three
months ended March 31, 2023 and March 31, 2022, respectively. The
increase is primarily due to an increase in product related
revenue, as gross margin was approximately 99% for the periods
ended March 31, 2023 and March 31, 2022.
Selling, general and administrative (SG&A) expenses,
inclusive of share-based compensation, were $50.1 million and $45.2
million for the three months ended March 31, 2023 and March 31,
2022, respectively. The increase is primarily related to an
increase in professional fees and services related to marketing and
pharmacovigilance, share-based compensation expense and travel and
related costs.
Non-cash SG&A share-based compensation expense included
above for the three months ended March 31, 2023 and March 31, 2022
was $7.6 million and $6.0 million, respectively.
Research and development (R&D) expenses, inclusive of
share-based compensation, were $13.2 million and $12.6 million for
the three months ended March 31, 2023 and March 31, 2022,
respectively. The increase is primarily related to an increase in
salaries and related employee benefit costs and share-based
compensation expense as the Company advances its AUR200 and AUR300
programs and fulfills the post approval FDA commitments related to
LUPKYNIS. The increase was partially offset by a decrease in
contract research organization costs related to the completion of
the AURORA 2 continuation study, which was completed in 2022.
Non-cash R&D share-based compensation expense included above
for the three months ended March 31, 2023 and March 31, 2022 was
$1.6 million and $1.0 million, respectively.
Interest income was $3.8 million and $0.3 million for the three
months ended March 31, 2023 and March 31, 2022, respectively. The
increase is due to higher yields on our investments as a result of
increased interest rates.
For the three months ended March 31, 2023, Aurinia recorded a
net loss of $26.2 million or $0.18 net loss per common share, as
compared to a net loss of $37.6 million or $0.27 net loss per
common share for the quarter ended March 31, 2022.
Financial Liquidity at March 31, 2023
As of March 31, 2023, Aurinia had cash, cash equivalents and
restricted cash and short-term investments of $361.5 million
compared to $389.4 million at December 31, 2022. The decrease is
primarily related to the continued investment in commercialization
activities and post approval commitments of our approved drug,
LUPKYNIS, inventory purchases and advancement of our pipeline,
partially offset by an increase in cash receipts from sales of
LUPKYNIS.
Aurinia believes that it has sufficient financial resources to
fund its operations, which include funding commercial activities,
including FDA related post approval commitments, manufacturing and
packaging of commercial drug supply, funding its supporting
commercial infrastructure, advancing its R&D programs and
funding its working capital obligations for at least the next few
years.
This press release is intended to be read in conjunction with
the Company’s unaudited condensed consolidated financial statements
and Management's Discussion and Analysis for the quarter ended
March 31, 2023 in the Company’s Quarterly Report on Form 10-Q and
the Company’s Annual Report on Form 10-K for the year ended
December 31, 2022, which will be accessible on Aurinia's website at
www.auriniapharma.com, on SEDAR at www.sedar.com or on EDGAR at
www.sec.gov/edgar.
Conference Call Details
Aurinia will host a conference call and webcast to discuss the
quarter ended March 31, 2023 financial results today, Thursday, May
4, 2023 at 8:30 a.m. ET. The audio webcast can be accessed under
“News/Events” through the “Investors” section of the Aurinia
corporate website at www.auriniapharma.com. In order to participate
in the conference call, please dial +1 (888) 645-4404 (Toll-free
U.S. & Canada). An audio webcast can be accessed under
“News/Events” through the Investors section of the Aurinia
corporate website at www.auriniapharma.com. A replay of the webcast
will be available on Aurinia’s website.
About Lupus Nephritis
Lupus Nephritis is a serious manifestation of systemic lupus
erythematosus (SLE), a chronic and complex autoimmune disease.
About 200,000-300,000 people live with SLE in the U.S. and about
one-third of these people are diagnosed with lupus nephritis at the
time of their SLE diagnosis. About 50 percent of all people with
SLE may develop lupus nephritis. If poorly controlled, lupus
nephritis can lead to permanent and irreversible tissue damage
within the kidney. Black and Asian people with SLE are four times
more likely to develop lupus nephritis and Hispanic people are
approximately twice as likely to develop the disease compared to
White people with SLE. Black and Hispanic people with SLE also tend
to develop lupus nephritis earlier and have poorer outcomes,
compared to White people with SLE.
About Aurinia
Aurinia Pharmaceuticals is a fully integrated biopharmaceutical
company focused on delivering therapies to treat targeted patient
populations with a high unmet medical need that are impacted by
autoimmune, kidney and rare diseases. In January 2021, the Company
introduced LUPKYNIS® (voclosporin), the first FDA-approved oral
therapy for the treatment of adult patients with active lupus
nephritis (LN). The Company’s head office is in Edmonton, Alberta,
its U.S. commercial hub is in Rockville, Maryland, and the Company
focuses its development efforts globally.
Forward-Looking Statements
Certain statements made in this press release may constitute
forward-looking information within the meaning of applicable
Canadian securities law and forward-looking statements within the
meaning of applicable United States securities law. These
forward-looking statements or information include but are not
limited to statements or information with respect to: Aurinia’s
estimates as to annual net product revenue from sales of LUPKYNIS
in the range of $135 - $155 million in 2023; Aurinia’s estimates as
to the number of patients with SLE in the U.S. and the proportion
of those persons who have developed LN at time of SLE diagnosis;
Aurinia’s belief that it has sufficient financial resources to fund
its current plans for at least the next few years. It is possible
that such results or conclusions may change. Words such as
“anticipate”, “will”, “believe”, “estimate”, “expect”, “intend”,
“target”, “plan”, “goals”, “objectives”, “may” and other similar
words and expressions, identify forward-looking statements. We have
made numerous assumptions about the forward-looking statements and
information contained herein, including among other things,
assumptions about: the accuracy of reported data from third party
studies and reports; the number, and timing of receipt, of PSFs and
their rate of conversion into patients on therapy; assumptions
relating to pricing for LUPKYNIS and patient persistency on the
product; that Aurinia’s intellectual property rights are valid and
do not infringe the intellectual property rights of third parties;
Aurinia’s assumptions relating to the capital required to fund
operations; the assumption that Aurinia’s current good
relationships with its suppliers, service providers and other third
parties will be maintained; assumptions relating to the burn rate
of Aurinia’s cash for operations; assumptions related to timing of
interactions with regulatory bodies; and that Aurinia’s third party
service providers will comply with their contractual obligations.
Even though the management of Aurinia believes that the assumptions
made, and the expectations represented by such statements or
information are reasonable, there can be no assurance that the
forward-looking information will prove to be accurate.
Forward-looking information by their nature are based on
assumptions and involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance, or
achievements of Aurinia to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking information. Should one or more of these risks and
uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those described
in forward-looking statements or information. Such risks,
uncertainties and other factors include, among others, the
following: Aurinia’s actual future financial and operational
results may differ from its expectations; difficulties Aurinia may
experience in completing the commercialization of voclosporin; the
market for the LN business may not be as estimated; Aurinia may
have to pay unanticipated expenses; Aurinia may not be able to
obtain sufficient supply to meet commercial demand for voclosporin
in a timely fashion; unknown impact and difficulties imposed by the
widespread health concerns on Aurinia’s business operations
including nonclinical, clinical, regulatory and commercial
activities; the results from Aurinia’s clinical studies and from
third party studies and reports may not be accurate; Aurinia’s
third party service providers may not, or may not be able to,
comply with their obligations under their agreements with Aurinia;
regulatory bodies may not grant approvals on conditions acceptable
to Aurinia and its business partners, or at all; and Aurinia’s
assets or business activities may be subject to disputes that may
result in litigation or other legal claims. Although Aurinia has
attempted to identify factors that would cause actual actions,
events, or results to differ materially from those described in
forward-looking statements and information, there may be other
factors that cause actual results, performances, achievements, or
events to not be as anticipated, estimated or intended. Also, many
of the factors are beyond Aurinia’s control. There can be no
assurance that forward-looking statements or information will prove
to be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
you should not place undue reliance on forward-looking statements
or information. All forward-looking information contained in this
press release is qualified by this cautionary statement. Additional
information related to Aurinia, including a detailed list of the
risks and uncertainties affecting Aurinia and its business, can be
found in Aurinia’s most recent Annual Report on Form 10-K and its
other public available filings available by accessing the Canadian
Securities Administrators’ System for Electronic Document Analysis
and Retrieval (SEDAR) website at www.sedar.com or the U.S.
Securities and Exchange Commission’s Electronic Document Gathering
and Retrieval System (EDGAR) website at www.sec.gov/edgar, and on
Aurinia’s website at www.auriniapharma.com.
AURINIA PHARMACEUTICALS INC. AND
SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, 2023
December 31, 2022
(unaudited)
ASSETS
Current assets
Cash, cash equivalents and restricted
cash
$
89,001
$
94,172
Short-term investments
272,533
295,218
Accounts receivable, net
19,046
13,483
Inventories, net
31,745
24,752
Prepaid expenses
10,096
13,580
Other current assets
1,227
1,334
Total current assets
423,648
442,539
Non-current assets
Other non-current assets
13,357
13,339
Property and equipment, net
3,842
3,650
Acquired intellectual property and other
intangible assets, net
6,101
6,425
Right-of-use assets, net
4,813
4,907
Total assets
451,761
470,860
LIABILITIES
Current liabilities
Accounts payable and accrued
liabilities
35,965
39,990
Deferred revenue
3,157
3,148
Other current liabilities
1,979
2,033
Operating lease liabilities
945
936
Total current liabilities
42,046
46,107
Non-current liabilities
Deferred compensation and other
non-current liabilities
12,321
12,166
Operating lease liabilities
6,986
7,152
Total liabilities
61,353
65,425
SHAREHOLDER’S EQUITY
Common shares - no par value, unlimited
shares authorized, 143,029 and 142,268 shares issued and
outstanding at March 31, 2023 and December 31, 2022,
respectively
1,193,019
1,185,309
Additional paid-in capital
88,885
85,489
Accumulated other comprehensive loss
(988
)
(1,061
)
Accumulated deficit
(890,508
)
(864,302
)
Total shareholders' equity
390,408
405,435
Total liabilities and shareholders’
equity
$
451,761
$
470,860
AURINIA PHARMACEUTICALS INC. AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (in thousands, except per share data)
Three months ended
March 31,
2023
2022
(unaudited)
Revenue
Product revenue, net
$
34,337
$
21,492
License, royalty and collaboration
revenue
72
133
Total revenue, net
34,409
21,625
Operating expenses
Cost of sales
421
256
Selling, general and administrative
50,124
45,197
Research and development
13,158
12,620
Other expense, net
290
1,434
Total cost of sales and operating
expenses
63,993
59,507
Loss from operations
(29,584
)
(37,882
)
Interest income
3,814
262
Net loss before income taxes
(25,770
)
(37,620
)
Income tax expense
436
10
Net loss
$
(26,206
)
$
(37,630
)
Basic and diluted loss per share
$
(0.18
)
$
(0.27
)
Weighted-average common shares outstanding
used in computation of basic and diluted loss per share
142,641
141,675
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230504005417/en/
Investor/Media: Aurinia@westwicke.com
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