ROCKVILLE, Md. & EDMONTON, Alberta–(BUSINESS WIRE)--Aurinia Pharmaceuticals Inc. (NASDAQ: AUPH) (Aurinia or the Company) today issued its financial results for the third quarter and nine months ended September 30, 2024. With continued strong commercial execution, the Company achieved significant year-over-year growth in total net revenue and net product revenue and $17.0 million in cash flow from operations in the third quarter. Having achieved $158.6 million in net product revenue for the nine months ended September 30, 2024, the Company is reiterating its net product revenue guidance range of $210 to $220 million for fiscal year 2024.
Aurinia is implementing a strategic restructuring to sharpen the Company’s focus on continued LUPKYNIS® growth and the rapid development of AUR200. This restructuring will result in a workforce reduction of approximately 45% and will focus the Company’s LUPKYNIS commercial strategy on the highest growth drivers. The restructuring will also improve operational efficiency, with anticipated post-restructuring annualized cash-based operating expense savings of more than $40 million.
“We are pleased to report continued strong momentum through the first nine months of the year,” stated Peter Greenleaf, President and Chief Executive Officer of Aurinia. “Going forward, our streamlined organization will enable us to lean further into key areas of the commercial LUPKYNIS business that have historically delivered optimal returns, while at the same time accelerating the development of our important pipeline product, AUR200.”
In the third quarter of 2024, the Company added 364 PSFs and 146 new patients who were either restarting LUPKYNIS or receiving it through a hospital pharmacy. Together, these total 510, which is 17% higher than the 436 PSFs in the third quarter of 2023. Conversion rates (PSFs converted to patients on therapy), time to conversion, and adherence rates remained consistent with the prior quarter.
Recent Milestones Achieved
- In September 2024, the first participant was dosed in a Phase 1 study of AUR200, a differentiated, potential best-in-class therapy for autoimmune diseases that targets both BAFF (B-cell Activating Factor) and APRIL (A Proliferation-Inducing Ligand). The Company continues to expect to report initial results from this study in the first half of 2025.
- In September 2024, the Japanese Ministry of Health, Labour, and Welfare approved LUPKYNIS, triggering the recognition of an additional $10 million milestone payment from Aurinia’s collaboration partner, Otsuka Pharmaceutical Co., Ltd.
Financial Results for the Three and Nine Months Ended September 30, 2024
Total net revenue was $67.8 million for the three months ended September 30, 2024, and $54.5 million for the same period in 2023, representing growth of 24%. Year to date total net revenue was $175.3 million for the nine months ended September 30, 2024, compared to $130.4 million for the same period in 2023, representing growth of 34%.
Net product revenue was $55.5 million for the three months ended September 30, 2024, and $40.8 million for the same period in 2023, representing growth of 36%. Net product revenue was $158.6 million for the nine months ended September 30, 2024, and $116.2 million for the same period in 2023, representing growth of 36%. The increase in both periods is primarily due to increased LUPKYNIS sales to the Company’s two main specialty pharmacies, driven predominantly by further penetration of the lupus nephritis (LN) market. Additionally, for the nine months ended September 30, 2024, Aurinia had sales of semi-finished product to Otsuka to support continued commercialization in its territories.
U.S. market penetration grew 25% year-over-year, with 2,422 patients on LUPKYNIS therapy as of September 30, 2024, compared to 1,939 as of September 30, 2023.
License, collaboration, and royalty revenues were $12.3 million and $13.7 million for the three months ended September 30, 2024, and September 30, 2023, respectively, and $16.7 million and $14.2 million for the nine months ended September 30, 2024, and September 30, 2023, respectively. The revenue is primarily due to a $10.0 million milestone recognized in the third quarter of 2024 for the Japanese Ministry of Health, Labour, and Welfare approval of LUPKYNIS and a $10.0 million milestone recognized in the third quarter of 2023 for pricing and reimbursement approval, coupled with manufacturing services revenue from Otsuka related to shared capacity services that commenced in late June 2023.
Cost of sales were $6.0 million and $6.8 million for the three months ended September 30, 2024, and September 30, 2023, respectively, and $22.7 million and $8.8 million for the nine months ended September 30, 2024, and September 30, 2023, respectively. The increase for the nine months ended September 30, 2024, is primarily due to the amortization of the monoplant finance right of use asset, which was placed into service in late June 2023 and therefore only partially impacted prior year results.
Gross margin was 91% and 88% for the three months ended September 30, 2024, and September 30, 2023, respectively, and 87% and 93% for the nine months ended September 30, 2024, and September 30, 2023, respectively.
SG&A expenses, inclusive of share-based compensation, were $42.4 million and $47.8 million for the three months ended September 30, 2024, and September 30, 2023, respectively, and $135.0 million and $145.0 million for the nine months ended September 30, 2024, and September 30, 2023, respectively. The decrease in both periods is primarily due to lower employee related costs, including share-based compensation and overhead costs, as a result of a reduction in general and administrative headcount, which occurred late in the first quarter of 2024.
R&D expenses, inclusive of share-based compensation expense, were $3.0 million and $13.6 million for the three months ended September 30, 2024, and September 30, 2023, respectively, and $12.7 million and $39.4 million for the nine months ended September 30, 2024, and September 30, 2023, respectively. The primary drivers in both periods were lower employee costs due to a reduction in headcount late in the first quarter of 2024, a decrease of expenses related to ceasing Aurinia’s AUR300 development program, and timing of expenses related to developing AUR200.
Restructuring expenses were nil and $7.8 million for the three and nine months ended September 30, 2024, and nil for the three and nine months ended September 30, 2023. Restructuring expenses primarily included employee severance, one-time benefit payments, and contract termination expenses related to the restructuring, which occurred late in the first quarter of 2024.
For the three months ended September 30, 2024, Aurinia recorded net income of $14.4 million or $0.10 net income per common share, as compared to a net loss of $(13.4) million or $(0.09) net loss per common share for the three months ended September 30, 2023. For the nine months ended September 30, 2024, Aurinia recorded a net income of $4.3 million or $0.03 net income per common share, as compared to a net loss of $(51.1) million or $(0.36) net loss per common share for the nine months ended September 30, 2023.
About Aurinia
Aurinia Pharmaceuticals is a fully integrated biopharmaceutical company focused on delivering therapies to people living with autoimmune diseases with high unmet medical needs. In January 2021, the Company introduced LUPKYNIS® (voclosporin), the first FDA-approved oral therapy dedicated to the treatment of adult patients with active lupus nephritis. Aurinia is also developing AUR200, a differentiated, potential best-in-class therapy for autoimmune diseases that targets both BAFF (B-cell Activating Factor) and APRIL (A Proliferation-Inducing Ligand).
