auph-20220630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

_____________________________________________

FORM 10-Q

_____________________________________________


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from_____________ to ________________

Commission file number: 001-36421

__________________________________________

Aurinia Pharmaceuticals Inc.

(Exact Name of Registrant as Specified in its Charter)

__________________________________________


Alberta, Canada
(State or other jurisdiction of incorporation or organization)
#1203-4464 Markham Street Victoria, British Columbia V8Z 7X8			98-1231763
(Address of principal executive offices)			(I.R.S. Employer Identification Number)

(250) 708-4272

Registrant’s telephone number, including area code

_____________________________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

Indicate the number of shares outstanding of each of the registrant's classes of common shares, as of the latest predictable date. As of August 3, 2022, the registrant had 141,892,181 of common shares outstanding.

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of exchange on which registered
Common shares, no par value	AUPH	The Nasdaq Global Market LLC

AURINIA PHARMACEUTICALS INC. AND SUBSIDIARIES

TABLE OF CONTENTS

Page

PART I.

FINANCIAL INFORMATION

Item 1.

Financial Statements (Unaudited)

Condensed Consolidated Balance Sheets as of June 3 0 , 2022 (unaudited) and December 31, 2021

Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited) for the three months and six months ended June 30 , 2022 and June 3 0 , 2021

Condensed Consolidated Statements of Shareholders’ Equity (unaudited) for the three and si x months ended June 30 , 2022 and June 30 , 2021

Condensed Consolidated Statements of Cash Flows (unaudited) for the six months ended June 30 , 2022 and June 30 , 2021

Notes to Unaudited Condensed Consolidated Financial Statements (unaudited)

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Item 4.

Controls and Procedures

Unregistered Sales of Equity Securities and Use of Proceeds

Item 3.

Defaults Upon Senior Securities

Item 4.

Mine Safety Disclosures

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

AURINIA PHARMACEUTICALS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)


	June 30, 2022		December 31, 2021
	(unaudited)
ASSETS
Current assets
Cash, cash equivalents and restricted cash	$	151,632	$	231,900
Short-term investments	240,104		234,178
Accounts receivable, net	18,173		15,414
Inventories, net	25,863		19,326
Prepaid expenses and other current assets	17,421		12,506
Total current assets	453,193		513,324

Non-current assets

Other non-current assets	12,355		11,838
Property and equipment, net	4,183		4,418
Acquired intellectual property and other intangible assets, net	7,338		8,404
Right-of-use assets, net	5,079		5,383
Total assets	482,148		543,367

LIABILITIES
Current liabilities
Accounts payable and accrued liabilities	32,380		34,947
Other current liabilities	1,293		4,640
Operating lease liabilities	953		1,059
Total current liabilities	34,626		40,646

Non-current liabilities
Deferred compensation and other non-current liabilities	16,323		15,950
Operating lease liabilities	7,431		7,680
Total liabilities	58,380		64,276
Commitments and contingencies (Note 17)
SHAREHOLDER’S EQUITY
Common shares - no par value, unlimited shares authorized, 141,892 and 141,600 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively	1,180,884		1,177,051
Additional paid-in capital	74,004		59,014
Accumulated other comprehensive loss	(1,853)		(852)
Accumulated deficit	(829,267)		(756,122)
Total shareholders' equity	423,768		479,091
Total liabilities and shareholders’ equity	$	482,148	$	543,367

The accompanying notes are an integral part of these condensed consolidated financial statements.

AURINIA PHARMACEUTICALS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands, except per share data)


	Three months ended				Six months ended
	June 30,				June 30,
	2022		2021		2022		2021
	(unaudited)
Revenue
Product revenue, net	$	28,148	$	6,591	$	49,640	$	7,475
License and collaboration revenue	43		29		176		59
Total revenue, net	28,191		6,620		49,816		7,534
Operating expenses
Cost of sales	1,599		308		1,855		356
Selling, general and administrative	51,532		44,322		96,729		84,127
Research and development	11,525		10,091		24,145		19,924

Other (income) expense, net	(476)		(967)		958		804
Total cost of sales and operating expenses	64,180		53,754		123,687		105,211
Loss from operations	(35,989)		(47,134)		(73,871)		(97,677)
Interest income	483		142		745		314
Net loss before income taxes	(35,506)		(46,992)		(73,126)		(97,363)
Income tax expense	9		18		19		26
Net loss	(35,515)		(47,010)		(73,145)		(97,389)
Other comprehensive loss:
Unrealized (loss) gain on available-for-sale securities, net of tax of nil	(235)		7		(1,001)		13
Comprehensive loss	$	(35,750)	$	(47,003)	$	(74,146)	$	(97,376)
Basic and diluted loss per share	$	(0.25)	$	(0.37)	$	(0.52)	$	(0.76)
Weighted-average common shares outstanding used in computation of basic and diluted loss per share	141,726		128,222		141,734		127,814

The accompanying notes are an integral part of these condensed consolidated financial statements.

AURINIA PHARMACEUTICALS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(in thousands)

(unaudited)

Common Shares

Three Months Ended June 30, 2022

Amount

Additional
paid in
capital

Accumulated
Other
Comprehensive
(Loss) Income

Accumulated
Deficit

Total
Shareholders'
Equity

Balance at March 31, 2022

141,742

SEC Form 10-Q filed by Aurinia Pharmaceuticals Inc