Why Aurinia Pharma Is Getting Slaughtered

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Shares of Aurinia Pharmaceuticals Inc. (NASDAQ: AUPH) were halved early in Monday’s session following a mid-stage trial hiccup. The company announced that it reached its primary endpoint in its Phase 2b Aura-LV clinical study in patients with active lupus nephritis (LN). Despite reaching the primary endpoint, there was another statistic that held back the study.

It was disclosed that there were 13 deaths (out of 265 patients) in the trial, as well as a higher overall rate of serious adverse events in both voclosporin groups. This appears to be the overriding factor in this study.

Considering these results, Aurinia plans to meet with the U.S. Food and Drug Administration (FDA) in the fourth quarter of 2016 to discuss these data and the drug’s subsequent clinical development and path to registration in LN.

Although these results might be considered mixed, management was very positive on what it had to say.

Neil Solomons, M.D., Aurinia’s chief medical officer, commented:

We are very pleased by these encouraging results and are grateful to those that participated in our clinical trials. The AURA study was conducted under rigorous and stringent criteria, enhancing our confidence in voclosporin’s potential ability to provide a substantial improvement over the currently accepted standard of care, especially given that study participants had such active disease and were exposed to such a low corticosteroid load. We continue to work diligently towards our goal of improving long-term outcomes for these patients.

Mary Anne Dooley, M.D., a rheumatologist, LN expert and chief investigator on the study, added:

These preliminary results show great promise and could potentially change the current treatment paradigm for LN. The remission rates show a meaningful improvement over the current standard of care. Achieving this result given the taper to low dose steroids represents a significant advance. Given the side effects of corticosteroids, limiting the dose could substantially enhance a patient’s quality of life.

Shares of Aurinia were last seen down almost 55% at $1.85, with a consensus analyst price target of $7.80 and a 52-week trading range of $1.42 to $4.49.

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