FDA official’s comments spark Aurinia sell-off; Halozyme buys a biotech

Today, a brief rundown of news involving Aurinia Pharmaceuticals and Halozyme Therapeutics, as well as updates from Novartis, IO Biotech and Enanta Pharmaceuticals that you may have missed. Aurinia Pharmaceuticals shares fell by double digits on Monday after George Tidmarsh, the head of one of the Food and Drug Administration’s main drug review offices, posted on LinkedIn that its lupus nephritis drug, sold as Lupkynis, has “significant toxicity” and hasn’t proven a “direct clinical benefit to patients.” Tidmarsh deleted that post and, shortly thereafter, clarified that his comments didn’t “reflect the views of FDA or HHS.” Still, the incident prompted Aurinia to respond with a statement standing behind Lupkynis’ “favorable benefit/risk profile.” Analysts rushed to its defense, too. Given the drug has a full U.S. approval, “we do not think there is any action FDA can take at this point,” noted Jefferies analyst Maury Raycroft. — Ben Fidler Halozyme Therapeutics will acquire fellow drug delivery specialist Elektrofi in a deal worth as much as $900 million. The buyout announced Wednesday hands Halozyme a type of microparticle technology that can help deliver biologic medicines through under-the-skin injections. The technology "substantially expands the scope of therapeutics that can be delivered subcutaneously,” Halozyme said. Halozyme is paying $750 million up front and could add another $150 million in milestone payments tied to certain product approvals. — Ben Fidler The FDA on Tuesday approved Novartis’ Rhapsido for people with a form of persistent hives known as chronic spontaneous urticaria. The clearance makes Rhapdiso, formerly known as remibrutinib, the first oral targeted therapy for the condition. Rhapdiso is part of a newer class of BTK inhibitors designed to treat autoimmune diseases rather than cancer. Sanofi won clearance of a similar type of therapy, Wayrilz, for immune thrombocytopenia in late August. — Ben Fidler IO Biotech will lay off half of its staff after being told by U.S. regulators it will need to run a new trial to support approval of its experimental skin cancer vaccine, Cylembio. The company had been hoping that a narrowly failed Phase 3 trial, combined with other supportive analyses, might be enough to convince the FDA to consider an approval. On Monday, though, it said the agency has advised against submitting an application. IO Biotech will work with the FDA to design a new trial, but in the meantime is restructuring to conserve cash, as it only has enough money to operate through the first quarter of 2026. — Delilah Alvarado Enanta Pharmaceuticals said on Monday that its experimental respiratory syncytial virus treatment demonstrated a “clinically meaningful benefit” in Phase 2 testing despite missing the trial’s main objective. The drug, dubbed zelicapavir, didn’t more quickly resolve, to “mild,” a specific group of respiratory symptoms. Zelicapavir did, however, have an apparent impact on a broader set of symptoms in adults at high-risk of disease complications, supporting Phase 3 testing with a different study design. Shares nearly doubled as investors focused on the “totality of evidence” supporting zelicapavir’s potential, Leerink Partners’ Roanna Ruiz wrote in a Monday note to clients. — Delilah Alvarado Eye drug developer Kala Bio will explore “strategic options” after its lead candidate for a type of persistent corneal defect failed a mid-stage trial. In a Monday statement, Kala said that KPI-012 met neither its primary nor secondary goals, sending shares down more than 90% and leading the company to scrap development. Kala will also lay off 19 employees, or a little more than half of its staff, to preserve cash as it evaluates its next steps. Kala had approximately $32 million in cash and cash equivalents as of June 30, according to a regulatory filing. — Gwendolyn Wu