Greetings, and welcome to the Aurinia Pharmaceuticals Third Quarter 2019 Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.It’s now my pleasure to introduce your host, Glenn Schulman. Please go ahead, Glenn.

Thank you, Kevin, and good afternoon, everyone. Welcome to Aurinia’s third quarter 2019 financial results conference call. Joining me on the call today from the Aurinia team are Mr. Peter Greenleaf, President and CEO; Dennis Bourgeault, our CFO; Dr. Neil Solomons, Chief Medical Officer and Mr. Michael Martin, our Chief Operating Officer.This afternoon, we issued our press release detailing the third quarter 2019 financial results. The press release and the associated financial statement package is available on our website at www.auriniapharma.com, along with a 6-K that was filed with the SEC, as well.I'd also like to remind everyone that today's call is being webcast live on Aurinia's Investor Relations website and a replay will be available following today’s call. Please note the content of today's call is property of Aurinia. It also cannot be reproduced or transcribed without our prior written consent.During the course of today’s call, we may make forward-looking statements based on our current expectations. These forward-looking statements are subject to a number of significant risks and uncertainties and our actual results may differ materially. For a discussion of factors that could affect our future financial results and business, please refer to the disclosure in today's press release, our most recent filings with the Canadian securities Authorities and reports that we file on Form 6-K with the U.S. Securities and Exchange Commission.Also note that all the statements made during today's call are as of today November 14, 2019 and based upon information currently available. Except as required by law, we assume no obligation to update any such statements as of this date.With all that preface, so let me turn the call over to Aurinia's CEO, Peter Greenleaf. Peter?

Well, thanks Glenn, and it’s a pleasure to have you all on the call with us today. As Glenn mentioned, we issued our third quarter financial results and recapped our recent accomplishments in the press release that went out this afternoon.So during my relatively brief tenure here at Aurinia, I have to say that I continue to be amazed by the dedication of the staff and the knowledge and expertise and focus of each team member that they bring to the advancement of voclosporin.As many of you are aware lupus nephritis is very serious form of SLE. It has a devastating impact on people living with the disease, their families, and the limitations of current available treatments are very well understood in the market space. Getting renal response in patients as rapidly as possible is key to preventing future end-stage renal disease and the need for dialysis and transplant.Aurinia is on the precipice of pivotal data that when we have, we will actively be preparing for success. Over the past few months, our team has attended events and conferences around the globe to meet with treating physicians, key thought leaders, individuals affected by lupus nephritis and patient advocacy groups, all to learn more about the needs of individuals with the disease that are being met currently, as well as the potential and important role that voclosporin can play in the patients that have this disorder and the involving treatment approach for this disease.During today’s call, in addition to reviewing our recent operational highlights and financial results, Dr. Neil Solomons will spend a few minutes to recap the history of voclosporin and the development path that has brought us to this point today.We thought that for today’s call, especially while we await the unblended and analyzed AURORA Phase 3 clinical trial…

Thanks, Peter, and thanks all for joining. And as mentioned, I'd like to spend just a few minutes this afternoon to recap the development path of voclosporin and our view on what we have to see from AURORA.As a reminder, AURORA is a global, randomized, double-blind placebo-controlled clinical trial that enrolled a total of 358 lupus nephritis patients. The trial which is designed to be comparable to the previously completed AURORA study is [Indiscernible] of voclosporin on top of or mycophenolate mofetil or MMF for the treatment of LN.We are excited to see whether voclosporin can increase the speed …

We are experiencing technical difficulties. Please hold. Ladies and gentlemen, please hold, we are experiencing technical difficulties. Please proceed.

Hello, it’s interesting, Neil. Please continue.

Okay. The primary endpoint for the study is renal response ratios previously referred to as complete remission at 52-weeks. And with the last patient, last visit taking place a few weeks ago, we are looking forward to receiving and reporting our trial results by the end of this year which is positive from the basis of our U.S. regulatory filing.This could result in the first FDA approved drug in this specific indication. As a reminder, voclosporin is a novel calcineurin inhibitor that has been tested in more than 2,600 subjects with some patients having received several years of therapy in the renal transplant setting. We’ve done an extensive research into the different characteristics in the molecule.This is highlighted by the results of our completed lupus drug-drug interaction study of voclosporin and MMF. Unlike cyclosporine A which is labeled as interacting with MMF, our study demonstrates the voclosporin has no such interactions on the exposure of MMF which leads us to believe that voclosporin can be used predictably in combination with MMF.I’d like to comment that the execution by the Aurinia team has been exemplary from the recruitments and outcomes observed in AURORA, our successful end of Phase 2 meeting with the regulatory agencies and the initiation and record enrollment of patients into Phase 3, our team has consistently met their milestones as we await these pivotal results.From our perspective, and based on our previously completed studies in LN, our hope is that AURORA will show a treatment that’s consistent with that shown in AURA at a P value of less than or equal to 0.05. We believe this is – with this would constitute a very positive treatment effect and we’ve taken them absolute delta of more than 10% between treatment will be clinically meaningful but based on the AURA…

Thanks, Neil. For the three months ended September 30, 2019, Aurinia reported a consolidated net loss of $19 million or $0.21 per common share, compared to a consolidated net loss of $18.3 million or $0.21 per common share for the same period in 2018.Research and development expenses increased to $17.8 million for the three months ended September 30, 2019, compared to $11.2 million for the three months ended September 30, 2018. The increase in these expenses were primarily related to the manufacturing of voclosporin for commercial and investigational use.In addition, higher costs were incurred for the AURORA two extension study, initiation of the Phase 2/3 dry eye syndrome clinical trial, completion of the DDI study, preparation cost associated with the planned NDA submission for LN, and these costs were partially offset by lower AURORA clinical trial costs.Corporate administration and business development expenses increased to $6.1 million for the three months ended September 30, 2019, compared to $2.9 million for the same period in 2018. The increase was reflected overall higher activity levels as the company scales the organization – ahead of AURORA Phase 3 results in LN. The company incurred higher cost for professional consulting fees, insurance, personnel and information technology and pre-commercial activities including market research.Non-cash stock compensation expense was $2 million for the third quarter ended September 30, 2019, as compared to $1.5 million for the same period in 2018 and was included in both R&D and corporate general and business development expenses.AURORA recorded a non-cash reduction of $4.5 million in the estimated fair value of derivative warrant liabilities which reduced a loss for the third quarter ended September 2019, compared to an increase of $4.8 million in the estimated fair value of derivative warrant liabilities which increased the loss for the third quarter as of September 30,…

Well, thanks, Dennis and before opening up to Q&A, I'd like to say that Aurinia is a truly a unique opportunity. With continued solid execution on all fronts, we are strategically preparing in building the organization for success. We are committed to realize the full potential of voclosporin and its ability to impact patients’ lives suffering from lupus nephritis.With a strong balance sheet of $134.5 million at the end of September 2019, we are well positioned to scale the organization, execute on our clinical development plans and most importantly, hopefully submit a robust dossier for voclosporin to the FDA next year to enable voclosporin to be the first approved drug for lupus nephritis.And with that, I'd like to turn the call back to the operator and open the line for Q&A. Operator?

[Operator Instructions] Our first question today is coming from Alethia Young from Cantor Fitzgerald. Your line is now live.

Hey guys. Thanks for taking my questions. Just a couple from me and we are all looking forward to the data by the end of the year. One, I just wonder if you could talk a little bit about the difference between in Phase 2 versus Phase 3 by clinical design, enrollment, if any, I know there are couple.And then, the second question I have for you is, I just want to talk a little bit about the dry eye program and the data and the case for it in 2020, I think people will start turn their attention if voclosporin will be successful there. And my third is, have you given any color around kind of commercial infrastructure, how many people themselves you might need or what kind of build up that would look like? Thanks.

Yes, so, why don’t I kick off and then push things around the table to talk a little bit about. So the first question was, Phase 2 to Phase 3 designs in lupus nephritis and differences that have take into account I think, from my perspective, being the probably the youngest one around this table in terms of my tenure with the company, one of the things that was most assuring to me is the fact that there is very little changes from Phase 2 to Phase 3 which is not always the case as you take end of Phase 2 results to the agency and shift into Phase 3. But I’ll maybe Neil to go little bit deeper into that since he has been here since the genesis.

Yes, so, as Peter said, the differences are appearing forward treating. In terms of design, the only major difference which we don’t believe will affect the enrollment of patients very much is that we are permitting – we have permitted a very limited amount of patients who have had a longer duration biopsy between six and 24 months. This is expected to constitute fewer than 10% of all patients and is not supposed to make any difference to the outcomes.In terms of the primary endpoints, obviously, that is as the year, the primary endpoint from AURORA is at 24 weeks, but the reason for that was that the 48 week data from AURA was so much more impressive in the 24 weeks. And that we actually use that to get off to produce over 54-week primary endpoint. And the other many operational differences which we've said before on previous calls, is that some of the countries we are using a different – this in Sri Lanka. We have a more enhanced medical monitoring in effect in the AURORA trial other than that the designs are almost identical.

And then, I believe your second question is centered on, I think the dry eye on opportunity and as move into actually showing sort of Phase 2b results, Phase 2/3 results, is that how do we see that opportunity? Well, I mean, I guess, I could start here and see if any of my others have – or from the team have thoughts.But I mean, dry eyes is a huge opportunity. Obviously, there is still a huge unmet medical need in terms of the available treatments that are out there today at the very patient and physician level, most recently published large-scale market research reports have shown that over the next three to five years, this market globally could be as large as $3 billion to $5 billion in total product sales.So, obviously, a huge opportunity to go after in terms of the business side and more importantly, a huge opportunity to try to continue to provide better solutions to patients in terms of treating the challenge that they have.I do want to underscore, I mean, we took this through the exploratory study that we did our secondary endpoint was so convincing to us it’s why we actually jumped into doing a well designed Phase 2b study and we actually engage in a full development program.The results that we saw versus the states were quite convincing to us and we're looking forward to taking that into the next study and actually starting to move towards a regulator path. It’s a huge market opportunity and I think it’s going to take us doing a Phase 2 before the market really starts to realize that this is an opportunity we're going to capitalize on.Mike, since you were sort of the brainchild behind developing this and starting this initiative, what would you add to my comments?

Peter, I would completely echo that. But in the data that released back in January this year, I think it’s clearly apparent that this molecule is much, much different than cyclosporine and doing something in particular the way it’s delivered to the eye and I would just urge you to go back and have a look at that data versus restate this head-to-head.

Thanks, Mike. And then the last question is centered around our thinking about commercial and while a lot of the pre-work has been done in terms of what I would think is appropriate up to this time period, I think the company is also been appropriately diligent and not overshooting the work and the infrastructure build pre-data.So I think we're adequately prepared and where we should be in the U.S. market for lupus nephritis and hoping to seeing positive results on the data that we are going to have by the end of the year. We would then move into a much more aggressive invest and build mode.To get into the particulars, first and foremost, we want to concentrate on the U.S. that’s going to be where we want to put our major emphasis as a company because we think we can be successful there. Outside the U.S., we are going to continue to move the regulatory ball forward.But we would most likely, look for partners in many of the major geographies outside the U.S. and to try to get into more detail, we think we can do this with a sizable enough investment to be impactful in the universe of rheumatologist and nephrologists treating the disease in the U.S., where we would most likely not have to bring on another partner support in the U.S.To give you any more specifics, I think it’s probably too early in the equation. We'll see what happens post the readout of the data.

Thanks. Very detailed and best of luck.

Thank you.

Thanks, Alethia.

Thank you. Our next question today is coming from Joseph Schwartz from SVP Leerink. Your line is now live.

Hey, Joe,

Great, thanks very much. Hey, how are you guys? Thanks for taking my question and congrats on all the progress. I guess, my first question is, one of the competitive landscape since Roche recently presented their Phase 2 data for their anti-CD 20 drug proliferative LN.So do you see this as a potential competitor for voclosporin? Or will there be a natural segmentation of the market. It’s been a while since there has been some success in LN. So, hopefully, this is the beginning of a new trend here?

Yes, I mean, first progress in this disease is something that’s great for patients. So, as things gets other competitive products continue to move through their developments albeit they are early in their development, we are excited for what that does to the patient community.Since Neil has been around this longer than I, maybe we can just give a few comments, Neil on why we see there is more than just the Roche data on there is AstraZeneca produced some data in lupus, not lupus nephritis.But they have an ongoing trial and then there are some other competitors that we are waiting to see data on. But since Gazyva is probably the most current and actually showed some data in lupus nephritis. Maybe, Neil you can give a few thoughts on that.

Yes, I mean, obviously, I mean Gazyva is a interesting from a mechanistic perspective complementary to voclosporin I am sure that as well it’s too many details rather than T cells, I believe. The data from this very small exploratory study is certainly encouraging.I think that's probably all I would say at this point in time, it's all we probably can say with the small study. They certainly – as you extend it the exposure out towards 18 months or so, and started to see a significant treatment to that. I think that’s – it’s up to them how t hey design that that Phase 3 study to be able to confirm this.But I mean, that’s what I can say and I also echo what Peter says about all players showing any integrated forms. That’s a very different landscape, is being encouraged.

Okay. And then…

We track it and will be watching it clearly. Go ahead, Joe. Sorry.

No problem. So, I was just curious if you could give us a sense of how many patients have elected to rollover from AURORA to AURORA2 who have been eligible to do that?

Yes. I don't think we've historically commented, or at least for this trial, we have not commented, Joe, in the public domain. So, we will know when we know, but we haven't reported on that.

Okay. Maybe then, I was wondering, if you could just walk us through the rationale to test two lower doses of VOS in the AUDREY trial that just began, it doesn’t seem to be driven by tolerability. Was that due to anything that you saw in prior dose-ranging work or regulatory feedback or some other rationale?

I think, our anticipation and so - our discussions with the FDA is, and looking at previous drugs that they’ve looked. Some concentration ranging is desirable. And we want us to cover our bases. We've had a pre-IND meeting with the FDA. And certainly this is what’s being done with other drugs.It’s always good to a clinical development practice to find the lowest effective dose and we believe that with the concentration of 0.2% with VOS, we are nowhere near that lowest effective dose. So, I think, it sounds the reason that we will try lower doses and then that was our rationale.

Okay. It makes sense. Thanks for taking my question.

Thank you. Our next question today is coming from Ed Arce from H.C. Wainwright. Your line is now live.

Hi, guys. Thanks for taking my questions and congrats on the continued progress through the quarter.

Thanks, Ed.

So, I have a couple first on the imminent readout. First, I guess, first couple for Neil. Just thinking back on AURA LV with the 49% complete remission or CR response at 48 weeks, this was a rigorous composite endpoint on UPCR less than 0.5, but also the steroid paper, the no rescue meds, and addressing no significant loss of kidney function.And with that, at 48 weeks, the delta was really about 25 placebo adjusted. And so, well, I heard your comments earlier about the clinically meaningful perspective being at least 10 and hoping to see more. I just wonder how if you could comment on that in the context of prior data, especially since you have better site selection for the Phase 3.And then, the other question around the LN study is just, if you could just discuss the differential, competitively, now that we've got two other readouts in the space or close, the mechanism of voclosporin, specifically, the dual-acting mechanism of both immunomodulatory like all the others, but also, its effect on the photo sites and the kidney directly, which doesn’t appear to be the case with others?And I have a couple follow-ups as well.

Okay. Well, thanks, Ed. I guess, to start with the last part of your two-part question here, because that’s where Joe went to. I mean, first and foremost, I want to reemphasize I think this is a good thing for patients. So we have more folks seeing some success here. For us to try to contextualize the success, I guess, one thing I would put forward and Neil will add on to this I am sure is, it’s still relatively early.The study that has been done is relatively small. But did see good effect and it appears that some of these B-cell inhibitors could potentially have a impact out to a longer time period and maybe, potentially, because we have to see this from more well controlled trials, not the same sort of rapidity of response that you would want to see in these patients early.So, to go back to something that Neil said, which is, these are separate pathways. There could be complementary effects in combination drugs down the road, we don't know. It could be good for patients to have both potential pathways depending on the genesis of the disease. I mean, it could be differences in how patients respond to different drugs, but we have been at this stage, we just don't know.These are not Phase 3 – this is not a Phase 3 trial that’s been done by Roche and we’ve not seen AstraZeneca’s readout in lupus nephritis specifically. While encouraging, it’s still relatively early and we have a Phase 3 trial reading out just here in a few short weeks and months. Neil what would you add to it?

Yes, and I think that’s a reasonable observation and it’s that the rapidity of onset for voclosporin. It appears to be a really almost unique feature of the drugs in the treatment of this disease. We put it down to this dual mechanism. We believe there is a direct transport neuro effect clearly a longer-term disease modifying effect.And as far as I can see from the small patient numbers, you don’t appear to get that rapidity with Gazyva. But again, it’s always dangerous comparing across trials, but mechanistically, it certainly fits in with what we believe about the targets.Back to your first question about the delta, sure, I mean, we saw 25% delta in 48 weeks. So, and that’s incredibly impressive. But I just wanted to kind of ground this all here and say that not at any point is any drug shown in two consecutive studies a P value of less than 0.5 and to me, that is not just a bit of win. Not as a huge win, not as a win that the FDA may consider to be approvable.So, I think we just need to take a step back at sometimes and we look at what we are trying to achieve here. Clearly, the bigger difference the better. No two studies are identical. There is always some there is concurrent intervals around every remission point.But what I cannot draw your attention to is, the highly – very, very high bar that the FDA sets and that's for and that’s for two studies – two studies to show a P value less than or equals to 0.05 and to me is going to be a big win if that occurs.

Ed, you had a follow-on question?

Yes, great. That’s lot of details, great. Just a couple quick questions aside from the LN study. One is on the news yesterday, I don’t know if you could comment on any particular reasons why Dr. Joon Lee decided to resign. And then, on the timeline, given your early 2021 potential launch, do you expect six month priority review? Thank you.

You want to comment on this?

Well, priority review which is our expectation at this point that we will get priority review yet. That's what our working assumption.

Yes, and Ed, on the news from yesterday first reinforcing the great addition of Jill to our Board in the investment banking and financial institution experience she brings to our Board really complements and rounds out the skill sets we need to move the company into the future and the fact that we are a Canadian company, and going to be operating in other geographies at cross-border experiences is really important to where we are going in the future.As for Dr. Joon Lee, Ed listen, it was personal reasons as to why that he resigned, nothing more than that. Didn’t really give much color and detail and I don’t think more should be read into it than that.

Thank you so much.

Thanks, Ed.

Thank you. [Operator Instructions] Our next question today is coming from Justin Kim from Oppenheimer & Company. Your line is now live.

Hi, good afternoon. Thanks for taking the questions. As we think about potential filing next half, from a timing perspective, can you describe what data from the ongoing blinded extension study might be available? And sort of what components maybe included for the FDA's review cycle or be available at a potential commercialization in 2021?

So, what I had said historically is that, we should feel comfortable that we are going to do enough of data dredge upfront.

Apologies ladies and gentlemen. It does appear the speaker line has gone silent again. One moment please while we are experiencing technical difficulties. Please proceed.

Justin where we drop off? If you were to get my walk through or didn’t that cut off midstream?

I think it dropped off midway.

All right. I am sorry again. The long and short of it to start and I am going to kick it to Neil, because Neil understands the patient flow for the extension trial probably, it’s not better than, be he is close enough to it to know probably what we’ll have or not have by the time we do the FDA submission.But the lead into that is, we are going to have a comprehensive data package to review when we come forward to actually produce the results. So that we can appropriately contextualize whatever results we see.I do not believe it was the intention to actually have the extension trial for submission. But to have it to be a complementary part of – as we look at the drug moving forward. But I don’t think it was part of the submission. Neil?

So, the – our discussion with the FDA is that we will be submitting some safety data – interim safety data from the AURORA continuation study as part of the 120 day safety update, but it’s not part of the primary submission you are hoping to.

Okay, great. And maybe just jumping on to some of the recent data that have come out at ACR, the operators in that data gathered some interest from investigators on what measures of extra renal benefits were observed if any. Can you discuss that what measures are being followed in AURORA and through AURORA 2?

Yes, so, obviously, this is primarily an acute active lupus nephritis trial. Some patients have highest renal manifestation, some actually very, very few though almost purely renal patients. We are looking at biomarkers of actually in a lupus such as the complement and also double-stranded DNA, which is I guess, more specific for lupus nephritis.In addition, we are looking at - scores as well, they constitute a secondary endpoint and obviously. And obviously, - has not only biomarkers, but also these are composites going to some and looking at clinical manifestations of systematic lupus.

Okay, great. My last question just is really around the recent DDI study with VOS and MMF. Can you describe, sort of how the minority of patients currently treated with off-label C&I are currently managed, and how that might differ from a potential use of voclosporin?

Well, I just started, I think, we basically set forward the standard of care as the control arm in the trial that we did today. Now as patients fail that, they have a host of different off-label solutions that they can go to that have varying degrees of data to support their utilization. But as we said, and I think everybody on the call know is, there is no current approved – FDA approved drug for the treatment, specifically of lupus nephritis.So it is a cost scale approach of drugs that are utilized, but the base standard therapy is what we are using which is MMF in combination with steroids, hopefully to steroids that are tapered over time. And if patients fail that, they can bring other therapies on whether that be cyclophosphamide, RITUXAN, and potentially even other therapies.But I guess, I would argue from what I’ve looked at in terms of literatures, there is limited literature to support the utilization of some of those follow-on therapies even though they are used.

Okay. Great. Great. I guess, maybe just from another standpoint, the results from the DDI study, are those incorporatable into sort of the case for a global use of claims being filed internationally?

I don’t know that I’d give a technical answer to that. But one of the things that I think the team here has done a very good job of and I say the team, because it predates me is, we were doing – the DDI study was actually one that was requested by the FDA, so we did it. But we have been doing other PKPD type works to try to better characterize how our molecule is differentiated.I think at the end of the day, the clinical result should be the ultimate talking point around that as to why we are different. Things like the DDI study and other PKPD work around the different structure of the molecule will help to continue to differentiate us versus cyclosporin.Let's just be clear, this drug is not cyclosporin. It is a different and new molecular entity and then that’s how we’ve been studying it and I think the results speak for themselves. Neil?

Yes, I think the question is actually around this…

Yes, and we’ve got a suite of patents now for the dosing protocol that we use in our – in the AURA study and we are using in the AURORA study. And right now, those have been successfully issuing grant in the United States.We are prosecuting those in the national phase and Europe and the rest of the world. And we hope some continuation patents will follow. But as far as detail in terms of these claims, we are going to keep that between us and the patent office for now.

Okay. Great. Thanks very much.

Thank you. Our next question today is a follow-up from Ed Arce from H.C. Wainwright. Your line is now live.

Hi. Thanks for taking the follow-up. Just a quick one. Do you have any sense or indication from the agency around a potential, Ad Com? And if so, what could be potential areas of interest from the agency? Thank you.

So, in our discussions with the agency that’s a possibility. There has been no drug approved in lupus nephritis. There is no common – for SLE. So, our expectation is that, we may get one for lupus nephritis as to what that – what the questions will be I’d imagine everything is potential for discussion.

All right. Thank you.

Thank you. Ladies and gentlemen, we’ve reached the end of our question and answer session. I would like to turn the floor back over to management for any further or closing comments.

Thank you. And I want to thank everyone for joining the call. At this time, we are excited about what’s to come and we want to thank you all for joining the call today. We remain very excited about what’s on the horizon for the company. So, I am sure, we’ll be in touch and if you have any questions in the near term, Glenn or I are here. Please feel free to reach out.Thank you very much and have a good evening.

Thank you. That does conclude today’s teleconference. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.