Aurinia Reports Third Quarter and Nine Months 2021 Financial Results and Company Updates
$14.7 million in net revenue for the third quarter 2021 (122% increase from second quarter 2021)
Steady increases in LUPKYNIS Patient Start Forms, Conversion Rates and Payer Coverage
Addition of two preclinical assets with potential in rare autoimmune conditions to grow and diversify the pipeline
Conference call to be hosted today at 8:30 a.m. ET
VICTORIA, British Columbia--(BUSINESS WIRE)--November 03, 2021--
Aurinia Pharmaceuticals Inc. (NASDAQ: AUPH) ("Aurinia" or the "Company") today issued its financial results for the third quarter ended September 30, 2021. Amounts, unless specified otherwise, are expressed in U.S. dollars.
Aurinia achieved third quarter revenue of $14.7 million, with nine months ended September 30, 2021 revenue of $22.2 million and maintains its previously stated annual revenue estimate in the range of $40 to $50 million for 2021.
"We are very pleased with Q3 results as we continue to execute on our LUPKYNIS commercialization strategies," said Peter Greenleaf, President and Chief Executive Officer of Aurinia. "Despite the challenge of the COVID-19 Delta variant and a slight seasonal slowdown, we saw steady increases in patient start forms and patients on treatment toward the end of the quarter and continue to see this upward momentum through October."
"Data presentations at key medical meetings this week, including additional interim results from the AURORA 2 continuation study, will help bolster awareness of and confidence in the efficacy and safety of LUPKYNIS and we expect final results of the continuation study to be announced by the end of 2021," Greenleaf added.
"Finally, while our commercial team focused on increasing adoption of LUPKYNIS, Aurinia recently added two exciting preclinical assets -- AUR200 and AUR300," said Greenleaf. "We are eager to leverage our expertise and capabilities to advance these compounds for the treatment of rare autoimmune diseases with high unmet needs."
Third Quarter 2021 Highlights & Upcoming Milestones:
-- Aurinia has secured 412 patient start forms (PSFs) in the third quarter
and as of November 3, 2021, Aurinia has secured a total of more than
1,265 PSFs.
-- PSF conversion rates continue to increase with more than 68% of PSFs
converted to patients on therapy. Q2 conversion rates were 50%. Time to
convert continues to decrease since launch: 30- and 60-day conversion
rates have improved each month.
-- As of early October, Aurinia has confirmed coverage for LUPKYNIS through
published payer policies for 65% of total lives in the market. Through
patients gaining access to LUPKYNIS, the company now has confirmed
coverage in plans covering 87% of total lives.
-- On August 17, 2021, Aurinia announced the addition of two novel pipeline
assets: AUR200, an Fc protein targeting BAFF/APRIL (B-cell Activating
Factor, known as BAFF, and A Proliferation-Inducing Ligand known as
APRIL) and AUR300, a novel peptide therapeutic that modulates M2
macrophages via the macrophage mannose receptor CD206. For the
acquisitions, an Investigational New Drug Application (IND) filing for
AUR200 is expected by the end of 2022 and an AUR300 IND filing is
expected during the first half of 2023.
-- On October 1, 2021, Aurinia's licensing partner, Otsuka Pharmaceutical
Co., Ltd., filed an initial marketing authorization application (MAA)
with the Swiss Agency for Therapeutic Products (Swissmedic) seeking
approval for the use of voclosporin for the treatment of adult patients
with active LN. The Swiss filing was based on the June 24, 2021 MAA
submission to the European Medicines Agency (EMA).
-- Regulatory review of the EMA MAA remains on track with a Committee for
Medicinal Products for Human Use (CHMP) opinion expected around mid-2022
followed by an EMA decision expected sometime in the third quarter of
2022. Additionally, Otsuka continues to work to finalize the timeline for
the Japanese New Drug Application (JNDA) regulatory filing with
Pharmaceutical and Medical Device Agency (PMDA) to seek approval of
voclosporin for the treatment of LN in Japan.
-- This week, Aurinia will present efficacy, safety and tolerability data
for LUPKYNIS at two key medical meetings. The American College of
Rheumatology (ACR) Convergence 2021 meeting (November 3-6) will feature
an updated analysis of the AURORA 2 continuation study and two poster
presentations on the efficacy of LUPKYNIS (from AURORA 1 data) across
biopsy classes as well as in recent onset LN. The AURORA 2 updated
interim analysis showed patients treated with LUPKYNIS maintained
meaningful reductions in proteinuria with no change in mean eGFR at 30
months of treatment. At the American Society of Nephrology (ASN) Kidney
Week 2021 (November 2-7) two Aurinia abstracts were accepted including an
oral presentation on the efficacy of LUPKYNIS in achieving complete renal
response in severe lupus nephritis.
-- Data from the full AURORA 2 two-year continuation study is expected to be
announced late in the fourth quarter of 2021.
Financial Liquidity at September 30, 2021
As of September 30, 2021, Aurinia had cash and cash equivalents and investments of $286.4 million compared to $422.7 million at December 31, 2020. The decrease was primarily related to the commercial infrastructure spend to support the launch of LUPKYNIS, payments for inventory, an upfront payment made as part of a collaborative agreement with Lonza to build a dedicated manufacturing capability (or monoplant) and an upfront license payment related to our recently acquired developmental program.
Net cash used in operating activities was $131.8 million for the nine months ended September 30, 2021 compared to $73.1 million for the nine months ended September 30, 2020. The increase was primarily due to the commercial infrastructure spend to support the launch of LUPKYNIS, payments for inventory and a one-time payment to a related party upon achievement of specific milestones partially offset by an increase in cash receipts. In the prior year, the Company was still in the development phase of LUPKYNIS.
The Company believes that it has sufficient financial resources to fund its current plans, which include funding commercial activities, including FDA related post approval commitments, manufacturing and packaging of commercial drug supply, funding our supporting commercial infrastructure, conducting planned research and development (R&D) programs, investing in our pipeline and operating activities into at least 2023.
Financial Results for the Quarter and Year Ended September 30, 2021
For the quarter ended September 30, 2021, Aurinia recorded a net loss of $50.3 million or $0.39 net loss per common share, as compared to a net loss of $42.1 million or $0.34 net loss per common share for the quarter ended September 30, 2020. For the nine months ended September 30, 2021, Aurinia recorded a net loss of $147.6 million or $1.15 net loss per common share as compared to a net loss of $94.6 million or $0.82 net loss per common share for the previous period.
Total revenue was $14.7 million and $29 thousand for the quarters ended September 30, 2021 and September 30, 2020, respectively. Total revenue was $22.2 million and $88 thousand for the nine months ended September 30, 2021 and September 30, 2020, respectively. Our revenues primarily consisted of product revenue, net of adjustments for LUPKYNIS, following FDA approval in January of 2021.
Cost of sales were $254 thousand and nil for the quarters ended September 30, 2021 and September 30, 2020, respectively. Cost of sales were $610 thousand and nil for the nine months ended September 30, 2021 and September 30, 2020, respectively. The increase for both periods was primarily the result of commercial sales of LUPKYNIS. Gross margin for the three and nine months ended September 30, 2021 was approximately 98% and 97% respectively.
Selling, general and administrative (SG&A) expenses were $44.1 million and $30.7 million for the quarters ended September 30, 2021 and September 30, 2020, respectively. For the nine months ended September 30, 2021 and September 30, 2020, SG&A expenses were $127.2 million and $57.2 million, respectively. The increase for both periods was due to the increase in salaries, incentive pay and employee benefits related to the expansion of the commercial and administrative functions to support the launch of LUPKYNIS which ramped up during the third quarter of 2020. Also contributing was an increase in professional fees for activities such as patient assistance programs, consulting, recruiting, legal, market research and marketing.
Non-cash SG&A share-based compensation expense for the three and nine months ended September 30, 2021 was $6.0 million and $19.2 million as compared to $3.8 million and $9.2 million for the same periods of 2020.