Aurinia Pharmaceuticals Inc (AUPH) 2021 Q1 法說會逐字稿

Good afternoon, ladies and gentlemen, and welcome to Aurinia Pharmaceuticals First Quarter 2021 Financial Results Conference event. (Operator Instructions)

It is now my pleasure to turn the floor over to your host, Glenn Schulman. Sir, the floor is yours.

Thanks, Matthew, and good afternoon, everyone. I'm pleased to welcome you to today's call discussing Aurinia's first quarter financial results. Joining me on the call this afternoon are Peter Greenleaf, our President and CEO; Max Colao, Chief Commercial Officer; Neil Solomons, Chief Medical Officer; and Joe Miller, our Chief Financial Officer.

This afternoon, after the close, we issued a press release announcing our financial results and recent operational highlights, which is accessible from our website at www.auriniapharma.com, and has been filed on Form 8-K with the SEC as well. We also filed our financial statement and management's discussion and analysis in our quarterly report on Form 10-Q.

I'd also like to remind everyone that today's call is being webcast live on Aurinia's IR website, and a replay will be available approximately 2 hours after the completion of today's call. Please note that the content of this call is the property of Aurinia and may not be recorded, reproduced or transcribed without prior written consent obtained from Aurinia. For approval, please feel free to reach out to me, Glenn Schulman, via e-mail at ir@auriniapharma.com.

Also note that 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 our press release and on our quarterly report on Form 10-Q, which is publicly available along with our most recent filings with the U.S. Securities and Exchange Commission and Canadian security authorities. Also, please note that all of the statements made during today's call are current as of today, May 6, 2021, and are based on information currently available to us. Except as required by law, we assume no obligation to update any such statements as of this date.

With all of that, let me now turn the call over to Peter Greenleaf, Aurinia's President and CEO. Peter, all yours.

Well, thanks, Glenn, and I want to thank everyone for joining us today. I'm going to spend a couple of minutes upfront walking everyone through our activities for the first quarter, including the launch of LUPKYNIS. We'll also review what's coming up in the back half of the year, a brief update on our ongoing clinical and R&D activities as well as a review of our financial position.

So with respect to the LUPKYNIS launch, as you all know by now, we were granted FDA approval around the end of January. And once we had the approval in hand, we got to work getting the therapy to patients. Max Colao is here today, and he'll provide with more specifics in a few minutes. But in short, we're executing to plan, and I have a great deal of confidence in the team and in the trends that we're currently seeing during the first quarter and into second quarter.

We ended the first quarter with 2 months of hard data, which included 257 patient start forms and a solid, albeit early, conversion rate. These trends continue and have grown into the early part of Q2. Things are off to a good start. And just like any novel drug launch, the back half of the year is going to be that much more important. As mentioned by one of our sell-side analysts' notes, most launches only realize a small percentage, give or take less than 5% or so, of first year sales in their initial launch quarter. We had just 60 days. So when you look at this metric, we believe that we are right on trend and currently pointing in the right direction.

It's also impressive to see these types of results in an environment highly impacted by COVID-19. And now with vaccines being broadly available in the U.S., and with current vaccination rates escalating around the country, we expect things to open up more broadly. A return to something close to pre-COVID levels would be a big event, especially for patients, clinicians as well as our reps who are out there in the field doing their jobs every day.

On our end, we continue to ramp up all of our activities. Our commercial team is out in the field and continues to educate clinicians. We launched our consumer ad campaign for LUPKYNIS, which leverages traditional and digital strategies. We also continue to engage with the payer community and have seen more policies coming online and formulary inclusion for LUPKYNIS obviously increasing our access with additional commercial and government providers.

A few other things I'd like to mention as we look forward to the rest of 2021. First, we're looking forward to the upcoming publication of the AURORA Phase III clinical study in a peer-reviewed journal. This manuscript has been accepted and should be published in the very near future. We will also have voclosporin data presented at the upcoming EULAR and ERA congresses in June. Our data display and new cuts of data continue at every major medical event during 2021.

On the clinical and regulatory fronts, we, along with our European and Japanese partner, Otsuka, are making the final preparations and remain on track to file the MAA for voclosporin in the EMA by the end of the current quarter. In addition, we also remain on track with our plans for approaching the PMDA in Japan this year.

With respect to our post-marketing commitments to the FDA, we plan to initiate our first pediatric-adolescent study with voclosporin later this year as well as finalizing our plans for a required lactation study. In addition, the AURORA 2 blinded, 2-year continuation study is on target to achieve a database lock by the end of 2021, and we look forward to reporting to you all, our top line results during the first quarter of 2022. And behind the scenes, our R&D group is actively working on continued product differentiation for voclosporin. More to report in the future, but as you've seen, we continue to publish R&D work evaluating novel attributes of voclosporin related to its lack of impact on elements such as glucose and lipids. More to come in the future on this. And then lastly, on the financial front, we ended the first quarter with just over $360 million, which will support us and our efforts well into 2023. So we have a strong balance sheet to support our ongoing activities.

I want to now turn the call over to Max Colao, our Chief Commercial Officer, who'll provide you with some more detail about our first quarter launch activities. Then after that, Joe Miller, our CFO, will give you more details about how our first quarter financial results laid out.

So with that, let me turn the call over to Max. Max?

Thank you, Peter, and good afternoon, everyone. Let me begin with the 3 takeaways that I (inaudible) from my remarks. And then I'll provide some supporting details for all the key points.

First, as Peter highlighted, I'm pleased to report that our progress and results in the first quarter are in line with our expectations. Our rare disease commercial model is working. Second, the dynamics of launching in the COVID environment are proving to be even more of a challenge than we initially expected. And let me tell you, that's really saying something because we went into this environment with our eyes wide open. Even so, the headwinds have been stronger than forecast. And so more about this in a minute as well. The third takeaway is more promising, and that is an event, both rare and significant, that occurred after the quarter closed. It has the potential to generate additional momentum by providing clear payer guidance in establishing LUPKYNIS coverage policies. That's cause for excitement, not only for us but also for patients and their caregivers, and I'll provide details in just a minute.

But first, how about some greater detail around the first quarter? The metrics I'm going to share reflect 48 business days of activity post approval. Over this time, we've tenaciously worked to drive LUPKYNIS adoption and to support HCPs and patients to gain access to treatment. To give you a sense of the magnitude behind this effort, more than 2,000 HCPs have attended our education programs. These have been a very effective forum for top KOLs to share their insight on the current state of the art in treating with lupus nephritis and on LUPKYNIS in particular. In the field, we've engaged over 6,000 HCPs to educate and identify patients. This represents 50% of our target universe. That number is even more impressive when viewed in the context of the current COVID environment where HCP access remains a formidable challenge. And when you consider that over 60% of these interactions have been face-to-face versus remote, you can see why I say the team's efforts have been truly tenacious.

As a result of these efforts, we received 257 patient start forms into Aurinia Alliance in Q1. In terms of conversion rates, 40% of these patients started treatment by the end of March. It's important to remember that this difference is not due to either bad start forms or lack of access. Rather, it reflects the time it takes for a script to be fully vetted by a payer and then reimbursed. That timing can be anywhere from 20 to as many as 50 days. So the real point here is that Aurinia Alliance has clearly been effective in supporting patients and providers gain product access. Quantitatively, we see further evidence of this as patient start forms and patients on treatment continue to increase here in the second quarter. Qualitatively, the feedback from both patients and providers on Aurinia Alliance support has been exceptional.

I'll share with you 2 brief quotes of the many comments that we've received. The first one is, "The support has been exceedingly helpful." As much as I love hearing that, this next testimonial is the one I like even better. In reference to Aurinia Alliance, this particular individual described it as, "The best I've ever encountered."

Our team has been just as tenacious with payers as we have with health care providers and patients. As a result of our proactive payer education efforts, we have today confirmed coverage for more than 120 million lives, 40% of the total. And even though it's still early, 11 payers have published LUPKYNIS-specific coverage policies as of now. All of the policies provide coverage to LN patients according to the labeled indication and are consistent with how LUPKYNIS was studied in its clinical trials. We expect the majority of payers to establish LUPKYNIS policies in the next 6 months.

So to sum up the first quarter, these metrics around LUPKYNIS prescribing and access actually ended up in line with what we anticipated. And as such, we remain confident in the credibility of our goal of establishing LUPKYNIS as the standard of care for LN and the viability of our commercial model to achieve that goal. In fact, we believe our metrics would even be more favorable were it not for the limiting effects of the ongoing COVID environment. And this isn't mere conjecture, it's a belief that's grounded in data. As reported by the World Lupus Federation, lupus patient care has been disrupted significantly by the COVID-19 pandemic. In their recent survey of lupus patients, WLF reported that 50% of the participants had decreased access to care. Patients reported significant hurdles in seeing their physicians and in access to medical testing.

Our own data corroborates the impact of COVID on our launch trajectory. Consider this, territories in Florida and Texas are outperforming territories in Massachusetts, New Jersey and Michigan by multiples that range from 5 to 15x. And this variability is not a reflection of inconsistent talent in the field. As I've mentioned on previous calls, we've recruited a seasoned, committed and expert sales team for all geographies. As I remarked a minute ago, this team has been able to gain access, on a face-to-face basis, over 60% of the time. But that's when access to clinicians was available in the first place. What we see is depressed results in those areas that have been subject to significantly higher degree of restrictions versus the less restrictive environments, such as Florida and Texas.

If there's a silver lining to this cloud, it's that the market traction we're obtaining in less restricted territories bodes well for the future as more people become vaccinated, as states relax their COVID restrictions and as LN care standards normalize. What also bodes well for the future is the feedback for rheumatologists and nephrologists in our market research. In looking at 2 pulse research studies that we conducted after launch, we're seeing greater than 70% of those surveyed to have LUPKYNIS awareness and strong recall of LUPKYNIS messaging. Most promisingly, we see more than 60% of surveyed rheumatologists and nephrologists intending to increase their LUPKYNIS prescribing in the next 3 months. So we have multiple reasons to anticipate increasing prescribing momentum over the course of the year.

And considering that we're still in the early phases of establishing payer access for LUPKYNIS, I wanted to highlight a milestone event that I alluded to earlier, namely, the completion of the Institute for Clinical and Economic Review's, or ICER's, recently completed cost effectiveness assessment and its published guidance for payer policy. ICER is a completely independent organization that conducts and reviews analyses to determine the extent of additional clinical value a drug offers over and above therapeutic alternatives and the current standard of care. Also, it evaluates whether or not the drug is priced in alignment with its clinical value and provides a payer policy guidance. In other words, it provides payers guidance on how to make a therapy available and what type of restrictions are appropriate to consider.

In their analysis of LUPKYNIS, ICER leveraged the knowledge and perspective of multiple stakeholders. For instance, there was insight from world meaning KOLs in this therapeutic area, including Dr. Brad Rovin, Dr. Meggan Mackay. Also, they solicited input from Kathleen Arntsen, President of the Lupus and Allied Diseases Association; and Linda Blount, President and CEO of the Black Women's Health Initiative. ICER actually sought input from payers themselves, such as Humana and Premera Blue Cross.

With all this multifaceted expertise and context, permit me to share some relevant verbatim from their report. "LUPKYNIS is an important new treatment option." That's good, but it gets better. "LUPKYNIS is priced in alignment with estimates of its benefits for patients." That's good, too, but it gets better yet. "This should guide payers to design coverage criteria that do not narrow coverage from the FDA label and that there is no other treatment that could be considered a first step treatment prior to eligibility."

Okay, I have one more to share with you. And it's the one I like the best. And the reason I'm so enamored with it is that it comes from ICER's President, Steve Pearson who, understandably, prides himself on a skepticism of drug company pricing. But with regard to LUPKYNIS, he said, "It's a celebration to have new treatments like this. How often do we see brand-new drugs, their first indication, to be priced within shouting distance of a fair cost effectiveness range? Almost never. It's just that rare. We're fortunate to be able to welcome that event." Thank you, Dr. Pearson. His point about how rare it is understates the case for out of the 102 therapeutic assessments that ICER has completed over the years, only 12 therapies were judged to be cost effective. So again, you can appreciate why we look at this as a true milestone event.

So to sum up, as I promised at the outset, let me summarize. We had a positive first quarter. We're on track. No small accomplishment in this challenging COVID environment. And while I'm the last person in the world to say that these challenges are fully behind us, I do believe it's fair to forecast some reduction in these headwinds in the coming months. There are definitely visible signs of this. I mean the uptake in rush hour traffic has to be encouraging, I suppose. But seriously, to whatever degree that takes place, there are multiple factors that justify our expectation for increased momentum. And not the least of these is the feedback from providers and patients that their UPCR numbers have been cut in half, even though the patients have been receiving LUPKYNIS for a short time.

That type of encouragement continues to energize our incredibly dedicated Aurinia team who have gone above and beyond since launch. They've done a great job in communicating the LUPKYNIS value proposition, supporting providers and patients in the most challenging of environments. It's exciting to see their efforts beginning to come to full fruition.

I'd now like to turn the call over to Joe for a review of the financials. Joe?

Thank you, Max, and good afternoon, everyone. As of March 31, 2021, Aurinia had cash, cash equivalents and investments of $361 million compared to $423 million at December 31, 2020. The decrease is primarily related to the commercial infrastructure spend to support the launch of LUPKYNIS, coupled with an upfront investment made in connection with the previously discussed monoplant manufacturing facility and onetime milestone payments triggered by the approval and first commercial sale of LUPKYNIS, both of which were paid out in the quarter.

Net cash used in operating activities was $53.5 million for the quarter ended March 31, 2021, compared to $22.6 million for the quarter ended March 31, 2020. The increase is primarily due to the commercial infrastructure spend to support the launch of LUPKYNIS. As a reminder, in the prior year, the company was still in the development phase of LUPKYNIS. And as a result, we did not incur any material related selling expenses. The company believes we have sufficient capital -- financial resources to fund our current plans, which include funding commercial activities, manufacturing and packaging of commercial drug supply, conducting our planned R&D programs, including our FDA-related post-approval commitments and operating activities into at least 2023.

For the quarter ended March 31, 2021, Aurinia recorded a consolidated net loss of $50.4 million or $0.40 per common share as compared to a net loss of $25.9 million or $0.23 per common share for the quarter ended March 31, 2020. Revenues were $1 million and $30,000 for the quarter ended March 31, 2021 and 2020, respectively. The increase was a result of commercial sales of LUPKYNIS, which began in January of 2021.

Cost of sales were $48,000 and $0 for the quarters ended March 31, 2021 and 2020, respectively. The increase was related to commercial sales of LUPKYNIS. Gross margin for the quarter was approximately 95%.

Research and development expenses were $9.8 million and $13.8 million for the quarter ended March 31, 2021 and March 31, 2020, respectively. The decrease in expense is primarily due to lower contract research organization expenses and other third-party clinical trial expenses following the approval of LUPKYNIS, including a reduction in NDA preparation costs, capitalization of supply costs following approval as well as the termination of the dry eye trial in Q4 of 2020. R&D share-based compensation expense for the quarter was approximately $1.1 million.

Selling, general and administrative expenses were $39.3 million and $11.1 million for the quarters ended March 31, 2021 and March 31, 2020, respectively. The increase is primarily due to the expansion of our commercial infrastructure, administrative functions and patient assistance programs, all in support of LUPKYNIS launch. Selling, general and administrative expense and share-based compensation expense for the quarter was approximately $6.6 million.

With that, I'd like to hand the call back over to Peter for some closing remarks. Peter?

Thanks, Joe and Max, and I want to thank you all for taking the time with us today. In close, it's early days, but we're feeling good about the LUPKYNIS launch. And we want you to hear directly from us that we're executing to plan and right on track with our internal projections. As we review, there's going to be a lot of activity going on in the back half of the year. And especially as things open up here in the States, we're excited about seeing greater progression. So we look forward to providing even more updates, additional updates, in the quarters to come and the months to come.

But for now, we'd like to open it up to any questions that you might have. So let me now turn it over to the operator for opening up lines for questions.

(Operator Instructions) Your first question is coming from Alethia Young.

Congrats on the new start numbers, it looks pretty good. A couple of things. One, I guess, I know it's early, but can you kind of give us your perspective on what you're seeing in the real world around titration? I know we've spoken of some doctors that are not always following the titration regimen. So I just wondered kind of how you think about that. And then just another question. Can you give us an update on kind of some of the Medicaid formularies and different things like that, if that is indeed applicable and just thinking about broadening out access? And then the last one is just what you're hearing or what your -- how your sales force is kind of detailing or educating against Gazyva -- sorry, no, Benlysta, actually, if it happens to come up into conversations.

Why don't I start out with the first and maybe the third question there and then ask Max to build on the third and maybe give us commentary on the government pay side of the equation. The simple answer, Alethia, on titration, this is -- for those that don't know, this is the eGFR dosing protocol that we have in place. I guess our experience has been that it's -- with a few number of weeks out there and limited access to direct information from office to office is that it's on track. So our net calcs in terms of what we think of a net value per patient per year seem to be playing out in the early weeks of the launch. So on track with what our assumptions would be my answer there, Alethia.

And then on the Benlysta thing, our -- first, we feel very comfortable that our team understands our data and understands theirs. And it's not the primary that comes up in conversation, I think. And I'd ask Max Colao to build on this from what he's hearing at the field level. The primary is getting physicians to, one, identify what patient might be appropriate for LUPKYNIS therapy and then ensuring that they're committed to differentiating the product versus other therapies that might be available or challenging them on why they may not have a sense of urgency to lower proteinuria in these patients. So there's a big education factor in trying to change the way physicians have historically treated. So I think that's coming up more often than, "Hey, when I'm making a treatment decision, do I use Benlysta or do I use LUPKYNIS."

So let me turn it to Max and see if he can dig a little more into maybe that question and the public payer side of the equation. Max?

Yes. Thanks, Peter. And thanks, Alethia. Yes, Peter is spot-on. Really, the -- what our focus is, is really creating that urgency in terms of bringing the patient in and starting the treatment. We're definitely seeing that there's just a large number of patients with high levels of proteinuria that are not controlled. And so it's really working through creating that urgency and explaining the value proposition of LUPKYNIS. And in terms of Medicaid, so it's a great question. So as of April 1, we've now confirmed that 90% of Medicaid lives have coverage. So we now are months out and the mandated Medicaid coverage is in place. And so we've confirmed 90% of lives now having coverage.

Wow, 90%, that's awesome. Congrats again.

Thanks, Alethia.

Your next question is coming from Ken Cacciatore.

I know you've reviewed a lot of different metrics, so I'm just going to ask a couple here to help us out. Just wondering, as we get to the current moment, is the pace accelerating of enrollment forms and conversion of those enrollment forms? So if you take us up to real time? Are you seeing a constant and steady building? Or were we working through a little bit of a bolus? I'd just love to hear how you frame that out.

And then also, now that you have engaged the number of clinicians that you suggest, just wondering, as you're getting almost a real-time survey of the patient landscape, can you talk about your views of actual patient size? I know it's a debate amongst us investors how many LN patients are out there and accessible. I would think with your interactions, you're able to kind of get a really good sense of that. So can you talk about any learnings and just kind of early interaction?

And then also, Peter, I hate to ask the question, but there's been commentary previous from you all about is the Street consensus number achievable. Can you just kind of frame your commentary around what you're seeing in consensus and how we should be thinking about that?

Okay. Thanks, Ken. Well, first, let me just go into -- all the numbers that we gave for the quarter were sort of locked into the quarter. So I want to try to stay very consistent to that. What I can tell you about both patient start forms and the time from a patient start form turning into a patient on drug have both steadily increased and/or decrease, meaning our patient start forms per day per week continue to increase on pace, as Max said, with what our expectations are into Q2. And with that, a subsequent decrease we're seeing as policies start to come online, as our Aurinia Alliance work with physicians and patients starts to come more online, a decrease in the time it takes from a patient to go from a patient initial start form to actual drug. So we feel good about the numbers. Although we didn't quote exactly what the numbers are through this time period in the quarter, we feel good at the trends that we're seeing. So I'll kind of leave it at that.

One thing you did mention is did we see a bolus of patients in the first quarter through patient start forms. Recall that we have an ongoing 2-year extension in our AURORA -- our original Phase III AURORA trial. So we didn't have a group of 30 or 40 patients that came out of that trial and went on to commercial drug, so there was no bolus there. And since we didn't have approval and our reps were newly trained, we were not out there identifying specifically patients for therapy to keep our reps in the right zone from a compliance standpoint. So what you see generated has been the grassroots effort in the first -- just about -- just under actually, 2 months of the first quarter of launch.

You asked a question about patient size. I think our answer is going to be consistent here. I think we still believe there's somewhere between 80,000 to 100,000 patients with active lupus nephritis in the U.S. And of that, we think we have an ability to play in about 80% of those patients. Now what I will put a strong caveat on is we have seen, in this COVID environment, access restrictions at certain centers, which is obvious. Many of the major medical institutions, especially tertiary care centers, are pretty locked down, right? So lupus clinics in many of those centers are not happening or they're happening virtual. And as the data Max shared, patient visits in general and follow-up diagnostic patients for patients -- or visits for patients with lupus are down almost 50% according to a very sizable patient survey done by the World Lupus Foundation.

So it's kind of hard to tell what we're learning in terms of real-world, on-the-ground data because of the COVID environment. But we still stay very confident in those higher-level numbers. As we learn more and things open up more, we'll make sure to relay some of that information to the markets. And then lastly, your last question was centered around where consensus is. And I will just reiterate that we feel comfortable in the zone of where consensus is. And as we're hard-charging with our business, that has not changed in the first quarter.

Your next question is coming from Joseph Schwartz.

Thanks for all of the helpful insights about the launch. It's good to hear the encouraging leading indicators. I was wondering if you could just expand a little bit by passing on some of the most common adoption patterns you're seeing so far. For example, is it mostly physicians that you've met with in person or virtual? Is that also the case? And who have submitted start forms? And for which patients are they reaching for voclosporin? Is it larger practices or academic practices versus smaller practices and community practices at this point? Given what I heard you say about the greater appreciation for the importance of proteinuria at some places, who've been the early adopters? And how do you expect the adoption patterns to evolve at the ground level?

Thanks, Joe. And let me turn that right to Max Colao, and he can give you a little bit more color from the first 60 days or so of what we're seeing in terms of doc and physician trends. Max?

Sure. Thanks. Absolutely. So yes, so the prescribers, it's 50% of them. It really kind of splits down the middle between rheumatologists and nephrologists, 50% on each side. Most of our prescribing at this point is in the community. Now there's -- most of the patients are in the community. Now the issue there is that the physicians in the community will only have a handful of patients, right? So you have to reach many physicians in the community to drive adoption.

In the lupus centers, we've talked about this before, there are about 60 lupus centers in the United States. They're most -- they're all within academic centers. They're definitely the areas where we have the most difficult time gaining access. Some of the lupus centers are actually still virtual. Some of them planned to be virtual until year-end. But we've gotten adoption in 50% of the lupus centers. And we have some leading lupus centers that are starting to leading -- to start to lead the way, including Hopkins, UCSF, SUNY Downstate. So we're pleased to see that we are making progress, even though it's more challenging because of the access issues. And I'll make one more point, which is in terms of patients, so the patients that are going on treatment are across all Class 3, 4, 5 primarily.

Okay. That's where I was going next, actually. And are you finding that physicians are -- is there really no set of common patterns? I mean how are the physicians choosing these patients as the next patients that were set to come in anyway? Are they reaching out in any cases to their worst cases? Are the -- is it patients that are the most refractory in advance?

Yes, I would say that it reflects what we see to be the largest patient opportunity at launch, which are basically the patients that may -- that likely have been treated but are treated and they're not achieving their proteinuria targets.

Yes. And Joe, the one thing I would add that was already said, and I think it's an important point, we are seeing some regional differences, right? Like, where access is much higher, we're seeing a higher productivity. And we think that trend is going to evolve as things open up in some other geographies more. That's the only thing I would add.

Your next question is coming from Maury Raycroft.

Congrats on the progress. First one is just checking in to see if it's possible to see the AURORA 2 data at EULAR, so just wanted to clarify on that. Or what else should we be expecting at the EULAR meeting?

Yes. Neil is on the phone. Neil, I don't know if we've submitted our -- any of our -- I think -- I don't know what the deadlines are for EULAR. But do you want to give any commentary on what might be seen this year around AURORA, to the AURORA 2 or the AURORA 2-year extension?

Yes. I mean, obviously, the AURORA 2 continues in a blinded fashion, but there are interim cuts that have been made for the regulatory submission. So there was a cut made, obviously, for the FDA submission, 90-day safety (inaudible), also a cut made to the MAA in Europe, which is going at the end of June. And there is a presentation at EULAR that has some of that AURORA 2 aggregate data that's going to be presented in June. We don't have the exact date or time, and the abstract has not been released yet, but you will see some of that. And obviously, towards the back half of the year, there's ASN and ACR, and it's our intention to submit even more data there.

Got it. Okay. That's helpful. And for the AURORA 2 extension data, just wondering if you tested that in your market research surveys with KOLs and if that had any impact on their future use of LUPKYNIS. Or if there's any additional color you can provide on the market research and some of the results you saw there.

Yes. I mean, I'll start. And obviously, the guy who is the closest to it, Max Colao, should build on whatever I might miss here. But listen, I mean, Max said it, right, like the intent to utilize the drug by both rooms and nephrologists is greater than 50%, right? So I think it's encouraging. And that's irregardless of the AURORA 2 extension study. I wonder, Max, if we've done any research specifically asking about that. But I think it's intuitive to assume that, with that data, it's only going to strengthen our position. I mean it's primarily a safety study, but showing that the drug continues to be safe after that time period is only going to strengthen docs conviction around the product and the amount of time they can use the product. Do we have anything specific, Max?

Not specific to AURORA 2. But what we do have specific to in the market research is that the efficacy messages are resonating. And there's both strong recall and high impact from the efficacy messages. Definitely, we see that the physicians are looking for more safety data, and we believe that AURORA 2 will be important in helping to kind of illustrate, especially what the long-term treatment -- the consequence is of long-term treatment. So yes, we're looking forward to that.

Your next question is coming from Justin Kim.

Just one for me. Is the team able to characterize what a goal depth of engagement might be for a target prescriber? Maybe to say it another way, how many sort of interactions on average may be ideal before a physician had enough comfort in writing a script, et cetera, and how that sort of engagement has been impacted by the pandemic or improved over the recent months?

Yes. I think we actually have some of that data. And Max, I don't know if you want to go maybe into a little of that detail.

Yes, sure. And I alluded to this, in the areas, really in the South where access is more open and, actually, we can get frequency with physicians, that's where we're seeing the highest levels of prescribing. And your question is spot-on. It takes multiple engagements with the physician to get comfortable, to identify the patient, to get into Aurinia Alliance. On average, across the nation, we've had -- I think it's about 2.5 engagements across all of the prescriber base. But in the areas where we see the highest prescribing, that average goes into like 7, 10 and above.

Got it. And maybe just another one, as a follow-up, how long does the team expect to reach that sort of doubling of the physicians engaged? Is there sort of a time estimate in terms of how long that might take?

Yes, listen, I think we have our internal projections of reps getting out there and talking to docs, but the live engagements is going to evolve. So I'm not sure we have -- we definitely don't hold that up as a metric to our sales force. We want you to see x number of physicians x number of times. Max, would you have a more quantifiable answer to that?

No, that's spot-on. Because of the regional differences around access, we haven't set specific targets. But again, what we're seeing is that frequency increases as things open up.

Your next question is coming from Ed Arce.

Congrats on the early progress of launch. First question is just on the first obvious tier as you just get into the launch, which is patient access and reimbursement. You mentioned, at this point, you've already got 120 million lives covered, and 11 payers have actually published LUPKYNIS-specific coverage plans. I was wondering, first, if you are free to disclose any of those 11 payers. And then with those policies, are there any specific sort of restrictions along the coverage pathway that are of interest? Especially given the broad label and the very favorable ICER recommendation, just curious if there were any sort of odd restrictions placed by any of those? And then lastly, you mentioned the number of start forms and the conversions. Again, it's early days, I'm just wondering if there have been any payer declinations so far.

Max, I'll tee to you on the payer and other questions that Ed just ran through. Happy to add color, but you're the closest.

Yes, thanks for that. So thanks for the question. And so yes, the 11 payers, they include, let's see, Aetna, Cigna, Highmark, Anthem, a number of the Blue Crosses, HealthNow. So that's the -- those are the ones that have published LUPKYNIS-specific coverage policies. And like I said, all of them are aligned to the labeled indication. All of them are consistent with how LUPKYNIS is studied. And I would say out of all those lives in the -- covered by the 11 policies, 90% of them don't have any step-through requirements. And then the ones that do, the primary step-through requirement is through MMF and steroids. So those are the coverage policies.

Of course, we've had payer denials. That's common just because even though -- if there isn't a covered -- if there isn't a LUPKYNIS-specific policy, then it's unclear what the criteria is. And so you do -- and this is typical in any rare disease launch, you do go through a denial and appeal process on a set of prescriptions. That's just par for the course. But that's -- from what we've seen in terms of denials, appeals and working through the process, there's nothing really that stands out that would be different than what we've seen in other rare disease launches.

Your next question is coming from David Martin.

The first one relates to the last question that you were asked. So the 11 payers that you named, what percent of the 100 million lives did they represent?

Yes. So on that one, it's hard to exactly quantify that. I would say it's -- kind of a very rough estimate would be 20%.

And if they don't -- if amongst those 80 million other lives, there isn't a specific coverage plan in place, how are the requests for reimbursement handled? And what is the reimbursement in those situations?

Yes. So every payer has a nonformulary request process. And it simply -- it's typically just a generic power authorization type of form where the physician articulates the rationale of why they want to use the named therapy. And so that's the process if there isn't a coverage policy in place.

Okay. Another question, are any patients or many patients coming onto LUPKYNIS as they start MMF and steroids? Or are most of them coming on only after they failed those?

Yes. So we don't have visibility to exactly all of the treatments that the patients are on and when they've started treatments. We don't have the visibility through Aurinia Alliance. But I can just tell you anecdotally that we are hearing of newly diagnosed patients coming on LUPKYNIS, even though the bulk of the patients that are on LUPKYNIS are ones that have been on other treatments and just are not getting to their proteinuria goal.

Okay. And last question, has there been any pushback? Like you mentioned that some doctors are waiting for the long-term safety data. Are any not prescribing it until they get that data because calcineurin inhibitors do have -- the older ones have a history of long-term nephrotoxicity? And is there any pushback because there are cheaper calcineurin inhibitors on the market?

Well, let me start there. First off, I just want to make sure we put the right context out there. Calcineurin inhibitor data in terms of nephrotoxicity has been seen in primarily the transplant population and in higher doses. That's not to say it doesn't -- the problem doesn't occur to us, and it's not to say that we don't get the question, because we do. We do hear from some physicians out there not a hesitancy to wait to utilize the product but I think one of the areas we got to focus on and really put intensity of our education effort is around impact, not just our not just our data but also around disease state awareness and what the impact of not aggressively treating is on these patients. We do hear that, "Well, yes, I know the drug. I know the data. And I'll consider it for patients that I consider for a first-generation CNI. Like, this is a better CNI." Well, obviously, those physicians don't even really understand how we studied the drug. And I think that's just a matter of education.

But Max, you can build on -- and I wouldn't say that, that is representative of the full community. I'm just being completely clear that we do hear that question. I don't know that we hear a lot, that "I'm not going to utilize the product until I see 2-year data." Have we, Max?

I would characterize just very consistent, when you launch a new therapy that's been studied in clinical trials, you have a subset of physicians that are cautious. And they want to see more data, more safety data, right? And I think that's just very consistent with -- what we're seeing is very consistent with what we've seen in other launches.

There are no further questions in the queue at this time.

Okay. Beautiful. Well, listen, I want to thank everybody for joining us after business hours on the East Coast. And as I said in my closing comments, I want to thank you and promise everyone that as we continue to make significant progress here, we'll look forward to laying that out over the quarters and months to come. Thank you for your time tonight. Take care.

Thank you, ladies and gentlemen. This does conclude today's event. You may disconnect your lines at this time, and have a wonderful day. Thank you for your participation.