Aurinia Pharmaceuticals (AUPH) Financial Report Summaries

Risks

• We depend on a limited number of customers and an estimated number of patients for a significant amount of our product revenue, and if we lose any of our significant customers, or if our estimates as to the number of potential patients is wrong, our business could be harmed.
• If we fail to comply with our reporting and payment obligations under the Medicaid Drug Rebate Program or other governmental pricing programs in the United States, we could be subject to additional reimbursement requirements, penalties, sanctions and fines, which could have a material adverse effect on our business, results of operations and financial condition.
• We report on various metrics relating to LUPKYNIS activity, and no single metric is indicative of, or directly correlated to, our current or future financial performance.
• Our proprietary rights may not adequately protect our intellectual property and product, and if we cannot obtain adequate protection of our intellectual property and product, we may not be able to successfully market our product.
• We may need to license certain intellectual property from third parties, and such licenses may not be available on commercially reasonable terms.
• We may become involved in lawsuits to protect or enforce our patents and other intellectual property rights, which could be expensive, time-consuming, and unsuccessful.
• We may not be able to protect our intellectual property rights throughout the world.
• Changes in patent law in the United States and other jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect LUPKYNIS.
• Not all of our trademarks are registered. Failure to secure those registrations could adversely affect our business.
• If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed. Confidentiality agreements with employees and third parties may not prevent unauthorized disclosure of trade secrets or other proprietary information.
• We may continue to have negative cash flow and we may never achieve or maintain profitability.
• Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations or cause any guidance we may provide to be inaccurate.
• Legislative actions, potential new accounting pronouncements, and higher insurance costs are likely to impact our future financial position or results of operations.
• We are exposed to inflation risk, credit risk and market risk related to changes in interest rates and foreign currency exchange, each of which could affect the value of our current assets and liabilities.
• Our limited operating history may make it difficult for you to evaluate the success of our business to date and to assess our future viability.
• Anticipated revenues may not be derived from licensing activities.
• We may require additional financing to achieve our goals, and failure to obtain such when required could force us to delay, reduce or terminate our commercialization efforts.
• We rely on third parties to conduct our clinical trials. If these third parties do not successfully carry out their contractual duties in compliance with regulations or meet expected deadlines, we might be subject to regulatory penalties or fines due to non-compliance with our post-marketing approval requirements.
• If we are unable to establish and maintain our agreements with third parties to sell and distribute LUPKYNIS to patients, our results of operations and business could be adversely affected.
• Our relationships with customers, healthcare providers, and third-party payors are subject to applicable anti-kickback, fraud and abuse and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, exclusion from government healthcare programs, contractual damages, reputational harm and diminished profits on future earnings.
• The failure to comply with anti-bribery, anti-corruption, and anti-money laundering laws, including the Foreign Corrupt Practices Act (FCPA) and similar laws associated with our activities outside of the United States, could subject us to penalties and other adverse consequences.
• Compliance with governmental regulation and other legal obligations related to privacy, data protection and information security could result in additional costs and liabilities to us or inhibit our ability to collect and process data, and the failure to comply with such requirements could have a material adverse effect on our business, financial condition or results of operations.
• Our employees, principal investigators, CROs and consultants may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading.
• We are dependent upon key personnel to achieve our business objectives.
• We may not successfully manage our growth. Our success will depend upon the timely expansion of our operations and our ability to successfully manage our growth.
• Interruptions in the availability of server systems or communications with Internet or cloud-based services, or failure to maintain the security, confidentiality, accessibility, or integrity of data stored on such systems, could harm our business.
• Our business is exposed to the risks associated with litigation, investigations and regulatory proceedings.
• Unstable markets and economic conditions may have harmful consequences to business, financial condition, and trading price of our common shares.
• Actual or anticipated changes to the laws and regulations governing the health care system may have a negative impact on cost and access to health insurance coverage and reimbursement of healthcare items and services.
• We may face substantial competition, which may result in others discovering, developing, or commercializing products more successfully than we do.
• Use of hazardous materials might expose us to risk in the form of damages.
• Health and safety risks associated with producing a product for human ingestion cannot be eliminated and might expose us to substantial risk.
• There is no assurance of a sufficient liquid trading market for our common shares in the future.
• The price of our common shares could be subject to volatility related or unrelated to our operations.
• There can be no assurance that we will continue to repurchase Common Shares or that we will repurchase Common Shares at favorable prices.
• You may be unable to enforce actions against us, or certain of our directors and officers under U.S. federal securities laws.
• If securities or industry analysts do not publish, or cease publishing, research reports about us, our business, or our market, or if they change their recommendations regarding our common shares adversely, the trading price and trading volume of our common shares could decline.
• Securities litigation or other litigation could result in substantial damages and may divert management’s time and attention from our business.
• Our ability to use our net operating loss carryforwards and tax credit carryforwards to offset future taxable income may be subject to certain limitations. We may also be subject to other potential tax consequences.
• Our business, results of operations, and future growth prospects could be materially and adversely affected by widespread health concerns, such as pandemics.