What happened

Shares of clinical-stage drug developer Aurinia Pharmaceuticals (NASDAQ:AUPH) rose nearly 11% Friday morning after the company announced plans for the development of its lead drug candidate, voclosporin, in treating lupus nephritis. Management met separately with the European Medicines Agency (EMA) and Japan's Pharmaceutical and Medical Devices Agency (PMDA) to discuss what data were needed in a successful phase 3 trial to potentially gain marketing approval.

Good news: Aurinia Pharmaceuticals announced that a single phase 3 trial can be used to collect data that will be sufficient to submit to regulators in the European Union, Japan, and the United States. As of 1:30 p.m. EDT, the microcap stock had settled down to a 6% gain.

So what

If each region had set different data standards, then the company may have needed to run multiple trials with varying designs. That would have been more expensive than running a single trial. Or, as may have been the case for a pre-revenue company such as Aurinia Pharmaceuticals, it would have been forced to choose a region to focus on initially while postponing development in others. Luckily, that won't be the case.

The ability to run a single trial swipes away a good deal of development uncertainty and provides a clear path for the company and investors, who can focus on a single phase 3 trial. Management even released the trial design, which includes the following highlights:

A 52-week, double-blind study enrolling 320 patients.

Randomized enrollment with one arm receiving 23.7 mg of voclosporin and standard treatment, and the other arm receiving placebo and standard treatment.

The primary efficacy endpoint will be complete remission, or renal response, at 52 weeks, which has set measuring thresholds.

It's important to note that the 23.7 mg dose of voclosporin was found to elicit the best response in patients in the recently completed phase 2b trial. If the proposed phase 3 trial can achieve similar safety and efficacy results to the mid-stage study, then the drug candidate should have no problem gaining approval on the three continents.

Now what

Aurinia Pharmaceuticals stock has soared 195% in the last three months on a string of favorable catalysts. Unfortunately for investors, they may be coming to an end in the near term as the company focuses on enrolling patients and conducting the trial. There really isn't much investors can do other than wait for the 52-week trial to be initiated and then completed.