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Aurinia Pharmaceuticals (AUPH) PT Raised to $12 at H.C. Wainwright Following Recent Positive Data

March 3, 2017 7:10 AM EST
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Price: $5.00 +1.42%

Rating Summary:
    7 Buy, 2 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 6 | Down: 3 | New: 1
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H.C. Wainwright raised its price target on Aurinia Pharmaceuticals (NASDAQ: AUPH) to $12.00 (from $8.00) while maintaining a Buy rating following positive top-line results from its Phase IIb AURA-LV (AURA) study in lupus nephritis (LN).

Analyst Ed Arce commented, "On March 1, after markets closed, Aurinia reported data that is very rarely seen in drug development (Exhibits 1-3). Treatment of lupus nephritis (LN) with voclosporin 23.7 mg BID in patients in the large, global Phase 2b AURA-LV study, which had already achieved a significant improvement in complete remission (CR) over standard-of-care (SOC) at 24 weeks (32.6%; odds ratio, OR: 2.03; p=0.045), demonstrated a substantial further improvement at 48 weeks (49.4%; OR: 3.21; p<0.001). We note that part of the bull thesis on AUPH (and one that we shared) had held that voclosporin was likely to retain a “durable effect” from 24 weeks to 48 weeks of treatment. Of course, the bears had believed that it was possible or likely that voclosporin would lose much of its efficacy after longer term treatment. Actually, Wednesday’s data proved that just the opposite happened. Parenthetically, we note that this type of treatment effect change over time is so uncommon that longer-term studies of effective drugs are commonly referred to as “durability of effect” studies, underscoring the widely-held expectation that just maintaining the same level of efficacy over a longer period (especially a year or more) is a strongly positive result. Furthermore, after speaking with management yesterday, we believe it quite possible that even longer-term treatment (18- or 24-months) could lead to a clear majority of patients achieving CR, as the company continues to search for evidence of a long-term treatment “plateau”. Given this exceptional treatment effect, we not only view the success of the upcoming Phase 3 AURORA study (see below) as substantially de-risked, but also believe that initial uptake upon commercial launch will be positively impacted. As such, we raise our PT to $12, from $8 previously, as our conviction grows further that voclosporin (on a background of MMF and tapered steroids) will quickly emerge as the new SOC treatment for LN."



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H.C. Wainwright, Ed Arce