What happened

Shares of Aurinia Pharmaceuticals (AUPH 0.56%), a mid-cap biotech company, closed trading Monday up by a healthy 26%. The stock raced higher in response to the FDA's approval of the company's oral lupus nephritis drug, Lupkynis (aka voclosporin).

Lupkynis is indicated for patients with active lupus nephritis who are already receiving background immunosuppressive therapy. Lupus nephritis is an advanced form of systemic lupus erythematosus, an autoimmune disorder that can lead to irreversible kidney damage, dialysis, and even death. Lupkynis is the first oral therapy approved for this condition. 

A rocket taking off.

Image source: Getty Images.

So what

Approximately 100,000 adults in the U.S. are currently afflicted by lupus nephritis, per Aurinia's own estimates. A similar number are believed to suffer from the condition in Europe. While that makes it relatively uncommon, Aurinia said that it expects to net roughly $65,000 per patient on annual basis after accounting for rebates, channel discounts, and patients discontinuing therapy early. Wall Street analysts, in turn, think this important new lupus nephritis therapy could generate sales in excess of $1 billion per year early on in the new decade. 

Now what

Is Aurinia's stock still a buy after Monday's sizable move northward? Although it could take a few years for sales of Lupkynis to ramp up, the company does appear to be a strong buyout candidate in the wake of this approval. Aurinia's market cap, after all, is still under $2.5 billion at the time of writing. Even at a price tag of say, $5 billion, it would be a downright bargain for any of the big pharmas that have interests in lupus. In short, this mid-cap biopharma stock may be worth adding to your portfolio soon.