9/21/2023
Aurinia Quells Investor Unrest, Names Founder and ex-CEO Foster to Its Board
Fierce Pharma (09/21/23) Dunleavy, Kevin
Long considered a takeover target, autoimmune disease specialist Aurinia Pharmaceuticals (AUPH) has stayed independent, to the consternation of some investors who think the Canadian company has not maximized its opportunity with lupus nephritis drug Lupkynis since its approval from the Food and Drug Administration in January 2021. On Sept. 21, Aurinia tamped down some of the agitation, naming its founder and former CEO Robert Foster to its board of directors. The appointment comes as part of an agreement with significant stockholder MKT Capital, which holds a 4.2% stake in the company. Aurinia has come to a “cooperation agreement” with the investment management firm, the company stated in a release. “He has a wealth of institutional knowledge, deep biotech leadership experience, and has led successful mergers, acquisitions, and commercialization deals,” Aurinia’s chairman Daniel Billen, noted of Foster. “These skills all will be helpful as we conduct our strategic review and continue the successful commercialization of Lupkynis.” The agreement comes four months after Aurinia Chairman George Milne and member Joseph Hagan quit the board under pressure from MKT at the company’s annual meeting. Then in June, the company disclosed that it was weighing a “sale, merger or other strategic transaction.” With the announcements, Aurinia saw its share price rise. “We are confident that meaningful value creation is on the horizon for Aurinia shareholders now that the board has initiated a strategic review and made significant governance enhancements,” MKT founder Antoine Khalife said in the Sept. 21 release. “We look forward to supporting Dr. Foster and the rest of the board as it oversees a comprehensive review of alternatives.” Foster currently is the CEO of Hepion Pharmaceuticals (HEPA). He discovered Lupkynis, also known as voclosporin, in the 1990s when he was CEO of Isotechnika Pharma. In 2002, Foster developed a $215 million licensing agreement with Roche (RHHBY) for voclosporin for kidney transplant immunosuppression. In August, Aurinia boosted its 2023 sales projection for Lupkynis from between $120 million and $140 million to a range of $150 million to $160 million, which is far from the blockbuster trajectory expected by Wall Street for the pharmaceutical. In 2021, soon after Lupkynis’ approval, Aurinia entertained buyout overtures from Bristol Myers Squibb (BMY). Other companies with a reported interest included GSK (GSK), Roche and Otsuka (OTSKY).
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