Aurinia Pharmaceuticals Inc (AUPH) Announces Licensing Deal with Merck Animal Health for a Dry Eye Syndrome Drug for Dogs

Aurinia Pharmaceuticals Inc (NASDAQ:AUPH) announced that it has signed a Definitive Agreement granting Merck Animal Health, known as MSD Animal Health outside of the United States and Canada, worldwide rights to develop and commercialize Aurinia’s patented nanomicellar voclosporin ophthalmic solution (VOS) for the treatment of dry eye syndrome in dogs.

Under the terms of this agreement Aurinia will receive an upfront payment and is eligible to receive further payments based on certain development and sales milestones. Furthermore, Aurinia will receive royalties based on global product sales. Merck Animal Health will be responsible for the remaining clinical development and commercialization of VOS for use in the animal health field, while Aurinia retains all human health rights. The companies will share in the final work product and any technical knowledge that may be generated during the collaboration.

“This partnership with Merck Animal Health underscores our long-standing belief that voclosporin has the potential to be effectively used across a range of therapeutic areas, in addition to its primary potential indication for the treatment of lupus nephritis,” said Richard Glickman, Aurinia’s CEO and Chairman of the Board. “In addition to enhancing dry eye treatment options in the animal health field, VOS has a differentiated product profile with long patent life that has the potential to compete in the multi-billion dollar human prescription dry eye market. While this ophthalmology project will continue to be advanced by Merck Animal Health, the Aurinia clinical team will remain focused on our lupus nephritis program, which is on track to begin enrollment for the AURORA Phase III trial this quarter.”

Throughout the past year, Merck Animal Health has conducted proof of concept research in dogs suffering from dry eye syndrome, which affects one out of every 22 dogs. The early symptoms can be easily missed by pet owners, leading to irreversible damage to a dog’s vision and eventually resulting in blindness.

“VOS has the potential to address significant unmet medical needs in ophthalmology, and the preliminary results of our canine dry eye trial are very promising,” says Holger Lehmann, DVM, PhD , Associate Vice President, Drug Discovery, Merck Animal Health. “We look forward to continuing our collaboration with Aurinia and believe this partnership is a prime example of the synergies that exist between human and animal health drug development for the benefit of all of our patients.”

“Completed preclinical and human Phase Ib studies using Aurinia’s nanomicellar VOS formulation have shown encouraging results in terms of delivery of active drug to the target tissues of the eye,” said Neil Solomons, MD, Chief Medical Officer of Aurinia. “The nanomicellar formulation enables high concentrations of voclosporin to be incorporated into a preservative-free solution for local delivery to the ocular surface. This has been shown to potentially improve efficacy, dosing frequency and tolerability versus the current treatments for dry eye syndrome. We are excited about the potential for topical ocular administration of voclosporin utilizing this unique and proprietary nanomicellar drug delivery technology.”

Aurinia is exploring all options to create value with its proprietary nanomicellar ocular formulation of voclosporin in the human health field including, but not limited to, further development, out-licensing or divestiture while remaining focused on the Phase III lupus nephritis program.

Shares of Aurinia are up nearly 5% to $7.00 in after-hours trading Monday. AUPH has a 1-year high of $10.54 and a 1-year low of $1.74. The stock’s 50-day moving average is $7.02 and its 200-day moving average is $4.09.

On the ratings front, Aurinia has been the subject of a number of recent research reports. In a report issued on April 10, Cantor analyst Elemer Piros initiated coverage with a Buy rating on AUPH and a price target of $14, which implies an upside of 104% from current levels. Separately, on April 7, FBR’s Vernon Bernardino reiterated a Buy rating on the stock and has a price target of $11.00.

According to, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Elemer Piros and Vernon Bernardino have a yearly average loss of 3.3% and 8.1% respectively. Piros has a success rate of 45% and is ranked #3993 out of 4555 analysts, while Bernardino has a success rate of 28% and is ranked #4448.

Sentiment on the street is mostly bullish on AUPH stock. Out of 4 analysts who cover the stock, 4 suggest a Buy rating . The 12-month average price target assigned to the stock is $12.00, which represents a potential upside of 75% from where the stock is currently trading.

Aurinia Pharmaceuticals, Inc. operates as a biopharmaceutical company. It focuses on discovery and development of immunomodulating therapeutics. Its products include voclosporin and non-immunosuppressive cyclosporine analogue molecules for the treatment of lupus nephritis. 

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