Source: cision | Published on: Tuesday, 21 May 2024
SEOUL, South Korea, May 20, 2024 --
Fellow Aurinia Shareholders,
ILJIN SNT Co., Ltd. and its affiliates (collectively, "ILJIN") is a long-term holder of more than 5% of Aurinia Pharmaceuticals Inc. ("Aurinia" or the "Company") and has been supportive of the Company's mission since 2010 when we invested in the predecessor company, Isotechnika. As one of the largest and longest-standing shareholders, we have had the privilege of supporting the Company through its drug development efforts and subsequent FDA approval of LUPKYNIS. We have also supported the CEO, Mr. Peter Greenleaf, having voted in prior years for his re-election to the Board.
Like other shareholders, we have been greatly shocked and dismayed to see the share price plummet since the Company's announcement on February 15, 2024 of FY 2023 operational results and the unsuccessful conclusion of its 7-month long strategic review process.
The Company recently announced its Q1 2024 operational results. While the Q1 2024 financials showed some improvement, there has been no sign of share price recovery despite the Q1 performance improvement. If anything, the stock performance following the recent earnings report has reinforced the market perception that there remain substantial uncertainties surrounding the Company's new corporate strategy (focused on commercial execution of LUPKYNIS) announced in February. We believe that if we choose to ignore and do not respond to these alarming developments, we may only see our shareholder value further eroding going forward.
In response to these concerning developments, we wrote to management and the Board of the Company in March, and have voiced our concerns and requested changes to the management and also the Board's role as the supervisor of management's performance. However, we only received inadequate responses from the Company reciting its prior statements.
As one of the long-standing shareholders, we now believe it is imperative to demand management's accountability, in order to put the Company back on track. If the Company does not change paths despite the massive losses shareholders have suffered during the past several months, it would only mean that there is no alignment of interests between company management and shareholders, and that it is time to establish a system within the Company to enforce management's accountability.
It is simply not right that while shareholders are suffering major losses, those same executives and Board members responsible for such losses continue to collect hefty amounts of compensation -- including substantial amounts of free RSUs -- from the Company as if nothing had happened. In our view, the only way we can enforce accountability is to make our Board an independent board, and what this means is that the Board composition must be changed, so that the Board may effectively act as a check and balance to Company management.
For these reasons, Mr. Greenleaf should no longer serve on the Board and should only serve as the CEO going forward. As the Company's CEO, Mr. Greenleaf will be able to continue to implement his new corporate strategy (focused on commercial execution) announced in February, while the Board without Mr. Greenleaf's participation will be able to discuss and determine the validity of the new corporate strategy independently and evaluate management's performance objectively.
In addition, given the Company's continued poor performance and its single-minded focus on LUPKYNIS (by foregoing all other growth options such as AUR 200 and AUR 300), it is important and necessary that the Board's size be kept to a bare minimum and no new board member should be allowed until after the Company has showed a clear sign of a turnaround.
In view of the foregoing, ILJIN's intends to vote as follows at the Company's upcoming annual meeting:
ILJIN believes that the changes above are necessary to strengthen the Board's role as a supervisor of management's performance and to enforce management accountability going forward, and respectfully request other shareholders' support for the changes.
Sincerely,
KH Sung
CEO of ILJIN SNT Co., Ltd.
Media contact: Yoonwha Lee, yoonhwa.lee@iljin.co.kr
View original content:https://www.prnewswire.co.uk/news-releases/iljin-snt-co-ltd-calls-for-board-restructure-at-aurinia-pharmaceuticals-302150680.html