Ultragenyx Pharmaceutical Inc. (NASDAQ:RARE) Q3 2025 Earnings Call Transcript

Ultragenyx Pharmaceutical Inc. (NASDAQ:RARE) Q3 2025 Earnings Call Transcript November 5, 2025

Operator: Good afternoon, and welcome to the Ultragenyx Third Quarter 2025 Financial Results Conference Call. [Operator Instructions] It is now my pleasure to turn the call to Joshua Higa, Vice President of Investor Relations.

Joshua Higa: Thank you. We have issued a press release detailing our financial results, which you can find on our website at ultragenyx.com. Joining me on this call are Emil Kakkis, Chief Executive Officer and President; Erik Harris, Chief Commercial Officer; Howard Horn, Chief Financial Officer; and Eric Crombez, Chief Medical Officer. I’d like to remind everyone that during today’s call, we will be making forward-looking statements. These statements are subject to certain risks and uncertainties, and our actual results may differ materially. Please refer to the risk factors discussed in our latest SEC filings. I’ll now turn the call over to Emil.

Emil Kakkis: Thanks, Josh, and good afternoon, everyone. Today, Ultragenyx is on the cusp of significant evolution and growth. We have 4 commercial products that have delivered consistent and substantial double-digit annual revenue growth over many years. We have 2 BLA submissions in progress for programs that are poised to address significant medical need for patients with ultra-rare diseases. We also have multiple late-stage clinical program with transformative commercial potential that are approaching pivotal data readouts. We’re at a defining moment for the company, and I’m pleased to report that our team is ready to maximize the opportunities ahead. We announced earlier today that we took an important step to strengthen our financial position, receiving $400 million of nondilutive capital from OMERS through the cap sale of a portion of our Crysvita royalties.

Importantly, we were able to defer the start of payments under this financing until January 2028. These funds and this timing bolster our balance sheet as we approach pivotal data readouts for our most significant commercial opportunities in osteogenesis imperfecta and Angelman syndrome. Importantly, we’ll continue to focus on managing our cash burn and prioritizing our investments. Shifting to clinical. We continue to see exciting momentum across our late-stage programs, beginning with GTX-102, our investigational antisense oligonucleotide for Angelman syndrome. In July, we announced the pivotal 48-week Aspire study completed enrollment with 129 patients and is expected to read out data in the second half of 2026. Last week, we announced the first patient had been dosed in the Phase II/III Aurora study, which evaluates GTX-102 in additional ages and genotypes.

This study, along with a fully enrolled Phase III Aspire study will generate data across the spectrum of genotypes and ages. Turning to UX143 for the treatment of osteogenesis imperfecta, the conduct of the Phase III Orbit and Cosmic study continues to go well. We hear stories from investigators who have patients in the open-label Phase II about how well their patients are doing, the improvements in their bone mineral density and the profound effect this drug is having on their lives. Data from the Phase III studies are on track to read out around the end of the year, which to us means December or January. As we move into the final analyses, we remain confident in setrusumab’s mechanism of action, its ability to make more bone in the places that need more strength, which should reduce fractures.

If successful, this will lead to a transformational treatment for pediatric and adult patients with osteogenesis imperfecta. For our existing approved products, our global commercial organization continues to deliver meaningful revenue and cash flow every year. This year, they are on track to deliver total revenue between $640 million and $670 million, which would be 14% to 20% growth from last year. Crysvita is the largest product in the portfolio, and we expect revenue to continue growing in the U.S., Canada, Latin America and Turkey as more and more patients initiate this important medicine. Dojolvi, Evkeeza, Mepsevii also meaningfully contribute to our financial base and provide a steady diversified source of revenue, is also expected to grow over time.

I’ll now turn the call over to Erik Harris to share more details on his team’s efforts last quarter.

Erik Harris: Thank you, Emil, and good afternoon, everyone. As Emil mentioned, the commercial organization is continuing to successfully launch 4 products across the globe. Starting with Crysvita in Latin America. In the third quarter, our team generated another 50 new start forms that led to approximately 50 more patients on reimbursed therapy. We now have approximately 875 patients on commercial product in the region as the team continues to meet the growing demand for this important product. Health care providers continually share positive feedback on how well their patients feel when on Crysvita, and this has led to an increasing number of doctors writing prescriptions for more than one patient. I’ll now shift to Crysvita in the United States and Canada, where our partner, Kyowa Kirin, has been leading commercialization since the transition in April 2023.

While the third quarter 2025 royalty revenue was impacted by expected seasonality, we also know that there has been continued underlying growth in new start forms and new patients on reimbursed therapy. We expect strong fourth quarter revenue growth consistent with prior quarters. Moving on to Dojolvi in the United States. Growth of new start forms in the third quarter continued to steadily increase, consistent with patterns we have seen in prior quarters. Since launching this product in 2020, our team has generated approximately 700 new start forms leading to approximately 625 patients on reimbursed therapy. The split between pediatric and adult patients continues to be approximately 65% peds and 35% adults. The number of new prescribers also continues to grow with a total of approximately 275 unique prescribers at the end of the third quarter.

For Dojolvi across the EMEA region, we are approaching 300 patients treated under named patient sales across the region. We continue to be pleased with this demand, especially since we are not actively marketing the therapy and simply responding to named patient requests. The majority of demand has been in France, but we also see increasing interest from patients and families in other EMEA countries, including Kuwait, Saudi Arabia and Greece. In closing, I’ll make a few brief comments Evkeeza, which we began commercializing in our territories outside of the U.S. with formal reimbursement approvals in just the last couple of years. In the EMEA region, we now have patients on reimbursed therapy from nearly all of the major countries, and we have added approximately 120 patients since the beginning of the year.

In total, there are approximately 310 patients across 17 countries who are receiving Evkeeza. I want to recognize the tireless efforts from my European team as they continue to successfully navigate the country-by-country pricing negotiations and respond to named patient treatment requests across the whole EMEA region. As I have mentioned in the previous earnings calls, we continue to expect some quarter-to-quarter variability in revenue, but we remain confident in the growing underlying demand of all of our products around the world. With that, I’ll turn the call to Howard to share more details on our financial results and guidance.

Howard Horn: Thank you, Erik, and good afternoon, everyone. Before I go through our financials and guidance, I want to touch on the financing we announced earlier today. Additional details are in the press release and 8-K, but the essence is that we received $400 million through the sale of an additional 25% of our royalty interest on the future sales of Crysvita in the United States and Canada. Payments to OMERS will start in January 2028 and are capped, just like our prior royalty financing agreement with OMERS. We were fortunate to have many financing tools at our disposal, and monetizing another strip of our Crysvita royalty with OMERS proved to be the best option. We went through a competitive process and OMERS provided an attractive cost of capital and a beneficial payment holiday in a cap transaction.

These terms helped us minimize the impact on our P&L and maximize liquidity. Importantly, Crysvita has proven to be a unique and highly valuable asset, one that we expect will continue delivering meaningful value after the cap on this agreement is hit and the royalty stream has returned to Ultragenyx. Adding $400 million to our balance sheet will help us deliver on our expected launches, setting us up for our next stage of growth and on our path to profitability in 2027. We will also continue to maintain our financial discipline, leveraging our existing infrastructure to launch UX111 and DTX401, if they are approved, and remain focused over the next year on delivering Phase III results for UX143 and GTX-102. Now turning to the financials for the quarter.

I’ll start with total revenue. In the third quarter of 2025, we reported $160 million, representing 15% growth over the quarter of 2024 and 18% growth for the first 9 months of 2025 over the first 9 months of 2024. Crysvita contributed $112 million in the third quarter and $57 million from North America, $47 million from Latin America and Turkey, and $8 million from Europe. Dojolvi contributed $24 million, consistent with its expected steady growth trajectory. Evkeeza [ contributed ] $17 million as demand continues to build following the launch in our territories outside of the United States. And Mepsevii contributed $7 million as we continue to treat patients in this ultra-rare indication. Total operating expenses for the quarter were $331 million, which included R&D [ expenses ] of $216 million and [indiscernible] investments in prelaunch inventory manufacturing, [ SG&A ] expenses of $87 million and cost of sales of $28 million.

Operating expenses also included noncash stock-based compensation of [ $37 million ]. For the [ quarter ], net loss was $180 million or $1.81 per share. As of September 30, we had $447 million in cash, cash equivalents and [ marketable debt ] securities, which has been further strengthened by the $400 million raised through the Crysvita royalty transaction we announced today. For the 3 months ended September 30, 2025, net cash used in operations was $91 million. In total, for the 9 months ended September 30, 2025, it was $366 million. We do expect 2025 net cash used in operations to [indiscernible] increase compared to 2024, and we also reaffirm our path to full year GAAP profitability in 2027. Shifting to revenue guidance for 2025, we are reaffirming the guidance we previously provided.

Total revenue is expected to be between $640 million and $670 million, which represents 14% to 20% growth over 2024. Crysvita revenue is expected to be to be between $460 million and $480 million, which includes all regions and all forms of Crysvita revenue to Ultragenyx. This range represents 12% to 17% [ growth ] over 2024. Dojolvi revenue is expected to be between [ $90 million ] and $100 million, which represents 2% to 14% growth over 2024. With that, I’ll turn the call over to Eric Crombez, who will provide updates on the clinical programs.

Eric Crombez: Thank you, Howard, and good afternoon, everyone. I’ll touch on UX111 for the treatment of MPS IIIA and DTX401 for the treatment of Glycogen Storage Disease Type Ia. Starting with UX111, we have had constructive formal and informal interactions with the FDA since receiving a complete response letter in July. We have also reviewed the additional longer-term data that the FDA requested, and we continue to see a durable treatment effect based on multiple biomarkers related to MPS IIIA with further separation in multiple clinical end points from natural history while maintaining an acceptable safety profile. The FDA interactions and internal progress we have made to address the observation give us confidence in a BLA resubmission in early 2026, followed by an FDA review of up to 6 months.

Shifting to DTX401. In September at the International Congress of Inborn Errors of Metabolism in Japan, we presented final 96-week results from the pivotal GlucoGene study. These results show durable, clinically meaningful and statistically significant improvement in cornstarch reduction while maintaining good glucose control. At week 96, study patients originally treated with DTX401 had been on study for nearly 2 years and patients originally randomized placebo had 48 weeks of treatment with DTX401 after crossover to study drug. At week 96, patients saw a 61% reduction in daily cornstarch intake across both the DTX401 and placebo to DTX401 crossover groups. This also corresponded to a mean decrease in the number of daily doses of cornstarch with the DTX401 group reducing by almost 2 doses at week 96.

The placebo to DTX401 crossover group, on average, dropped 1.6 daily doses by week 96. The improved glucose control and reduction in dependence on cornstarch is particularly important overnight with the increased risk of hypoglycemia while patients are sleeping and less able to detect symptoms. Reducing overnight cornstarch doses also helps to alleviate the burden of needing to wait to take cornstarch and the real risk of missed doses. At week 96, 67% of patients were able to eliminate at least 1 nighttime dose of cornstarch. The DTX401 group saw a 70% reduction of nighttime cornstarch when compared to baseline and the crossover group saw a similar mean reduction of 75% compared to week 48. These clinical results were also supported by improvement in patients’ impressions of their disease as measured by a Global Impression of Change scale or PGIC and patient interviews.

In the DTX401 group, 10 of 12 or 83% of patients felt that the disease management was improved 96 weeks after receiving DTX401. For the placebo to DTX401 crossover group, 18 of 19 or 95% of patients had improved disease management just 48 weeks after receiving DTX401. What is most important is that patients were able to reduce their dependence on day and nighttime cornstarch, feeling better while doing so, all while maintaining good glycemic control. This is why we believe this could be a transformative and life-changing treatment for these patients. In August, the FDA granted us the ability to begin a rolling submission of our BLA, which is underway and going well. The complete application will include the 96-week clinical data and the CMC updates that are in process based on the UX111 feedback.

We expect to complete the DTX401 rolling submission next month. I’ll now turn the call back to Emil to provide some closing remarks.

Emil Kakkis: Thank you, Eric. I’ll quickly recap the milestones and catalysts as we head toward the end of the year. For UX143 in osteogenesis imperfecta, the last patients in both the Orbit and Cosmic studies have had their final visits, and we are on track to share top line data from these studies in December or January. For GTX-102 in Angelman syndrome, we continue treating patients in the 48-week Aspire study and continue enrollment in the supportive Aurora study. For DTX401 and GSDIa, the rolling BLA submission continues, and we are on track to complete this filing in December. Lastly, UX111 in Sanfilippo syndrome, we are responding to observation noted [indiscernible] and expect to resubmit the BLA early in 2026. We are well positioned to deliver transformative therapies for rare disease patients while generating meaningful long-term shareholder value.

We have a growing base of global revenue, a strong balance sheet and focus to execute on our top priorities. We look forward to sharing setrusumab data and reading out the GTX-102 Phase III data in the second half of 2026. With that, let’s move on to your questions. Operator, please provide the Q&A instructions.

Q&A Session

Operator: [Operator Instructions] Our first question comes from Gena Wang with Barclays.

Huidong Wang: I know you will have very important data update on Orbit and Cosmic, you said, around year-end 2025, so maybe if you can walk us through the logics there. Like should we actually more likely expecting the data will be at the JPMorgan giving the so close to holiday time? And also when you share the data, I assume it will be both Cosmic and Orbit data. And then if you can also talk about the different scenario, how would you take to the next level?

Emil Kakkis: Great. Well, first, I’ll say that we — it’s going to include Cosmic and Orbit both together. So both will come out together. We’re saying December or January because we’re doing the cleaning process and the finishing of the database locking analysis, and we don’t have the precise timing. We’re providing some variability there because of the process is not defined, but we will expect to report on both either in December or in January.

Operator: Your next question comes from Maury Raycroft with Jefferies.

Maurice Raycroft: Maybe just following up on Gena’s question for OI. Well, I guess to start off, can you comment on what you’re seeing in the open-label extension from the Phase II? And you provided some anecdotal perspective there, but can you provide more quantitative perspective? And just anything additional on how we should think about the range of effect sizes on fracture reduction? And what would be needed to succeed for the final analysis?

Emil Kakkis: Okay. Well, we haven’t put out another cut of the Phase II data, so I can’t give you any more quantitation. I think what we’ve been observing in the trial is consistent with what we’ve put out before and we decided to focus our work on the Phase III. So we don’t have any more quantitative data, but we’re comfortable with what you’ve seen on Phase II is consistent as we move forward. Now with regard to what we expect in Phase III, we’ve said that anywhere between 40% and 70% reduction in fractures, in that range, is a very good fracture reduction level. And I don’t think that the exact percentage within that range matters as much as how patients feel and how they’re functioning. And from the Phase II study, it’s pretty clear that the way patients are functioning is quite important in terms of their ability to take on exercises, to walk better, get out of wheelchairs or using walkers, et cetera.

So we think anywhere in that range — and I think most KOLs have suggested something better than 40%. We’ve seen 67% in the Phase II study. I think anywhere in that range is — I think, would be a clinically meaningful change for these patients. But the effect on their overall function, I think, will ultimately be even more important in how the product launches. And I would tie that back to XLH because in XLH, the rickets score change didn’t really change people’s views. It shows the drug worked but how patients felt on the drug that drove the adoption of that drug. So we’re speaking from experience there on what we expect. But everything we’ve seen in Phase II says that this drug has a potential for it to be transformative in changing not only the fracture rate but how patients feel and how they function on a day-to-day basis.

Operator: Your next question comes from Yigal Nochomovitz with Citi.

Yigal Nochomovitz: Could you just clarify with regard to the UX111 and the 401 submission? I thought the idea was to sort out the CMC-related questions on UX101 first and then get that submitted and then do 401. But now it seems like you’re going to do 401 and then 111. And you mentioned something about an observation, so maybe that’s the reason. But — or is there another reason, please?

Emil Kakkis: Well, the filings were always very close to each other. I mean, they were always within a month of each other, so what we — there are some aspects of the program involved, the inspection facility that need to be in — common to both, but there were certain things that were specific to 111. In our Type A meeting, the FDA made some combination, but it did require us to have full reports. And some of those reports take — took a little bit more time, which is why 111 is now following 401. But there’s no real change, just the exact timing of when the final reports for things could be put together that are needed for each. 401 doesn’t have some of those things because it is the new filing, and so we felt we can get the things that are uncommon done in time and kept 401 on track to file this next month. So it’s a slight change, but I don’t think it’s a fundamental change. It’s just what we have to get done and when.

Yigal Nochomovitz: Okay. And then if I could just do one follow-up, so on the first OMERS transaction back in 2022, I guess, how much of that is — how close are you to the cap of the 1.45, if you could comment on that aspect of it?

Emil Kakkis: Well, I’ll let Howard go through it. But we sent — at that time, we sold 30% and we had a cap. And now we’re selling a little bit of extension of that plus another piece. But the cap ultimately is going to cover both pieces. But maybe, Howard, you can explain it simply for them.

Howard Horn: Yes, Yigal, thank you for the question. We can’t actually tell you how we’re tracking to the cap. But I think what Emil said was important that the prior deal with OMERS, so the 2020 agreement with the 30%, that has its own cap. Once it’s hit, it will then flow into this new deal. And together, that piece plus the additional 25% that we announced today will together have its own cap of 1.55x the $400 million that we raised. There’s actually a really helpful page in our corporate deck that’s either on our website or will be there soon that describes this.

Operator: And your next question comes from Tazeen Ahmad with Bank of America.

Tazeen Ahmad: Just to stay on the point of this OMERS topic, that $400 million that you announced today, how far does that go in helping to address any concerns investors might have about the potential for financing needs coming up in 2026, especially as it relates to September when your priority vouchers would need to be renewed, if you could give some color on that? And then secondly, on the scenarios of Orbit and Cosmic, how are you thinking about if one of the studies is positive and the other is not? So let’s say that Orbit is positive and Cosmic is not and vice versa, how would that impact, you think, your chances of getting approved in OI?

Emil Kakkis: Well, let me answer the Orbit, Cosmic first. Then I’ll let Howard talk about the OMERS transaction [ being ] the cash runway story. With regard to Orbit and Cosmic, we think both studies have — are powered to succeed. So we’re expecting both to succeed. If on the outside chance that one doesn’t and one does, I think that we’ll have enough data to help support the full range of the indication. Remember, Orbit is against placebo and is older kids. Cosmic is younger kids and against the control. If we show good bone mineral density improvements in the younger kids but versus maybe the p-values didn’t hit for — versus bisphosphonates, for example, but we show that the effect is still happening, I think we can manage that in terms of getting the age indication by showing the treatment effect is occurring and then safety is good down at the young ages.

If — the Cosmic study is smaller, but 1 advantage of it is that it’s a narrower population because there are young patients only of 2 to 7 rather than including adults. So even though it’s smaller, it also is a narrower population. So it could also achieve — with the narrower population, maybe there’s less variation. It could come out positive and show a good effect, if Orbit turned out to be — have too much variation and was missing slightly. But we can then show that the older patients are seeing the same effect we saw before. So I think if we get one or the other study positive, we’ll be able to work forward. And how we solve the issue of the age range and the indication, I don’t expect there to be a difference in how the drug works. I think both studies should show a substantial bone mineral density benefit improvement and should show improvement in fractures.

So we’re confident in the program, but I think we can make it work with either combination of results. Now I’ll let Howard talk about the OMERS deal and cash runway sort of question.

Howard Horn: Yes. So I guess maybe I’ll couch this in the term — in terms of our pathway to profitability in ’27. There are a number of assumptions that go into that. First of all, the recent changes in timing are all factored into what I’m about to say, but on the revenue front, we expect to have continued double-digit growth from our current products and some contributions from launches. On the expense side, we will continue to manage expenses, but we will incorporate some select investments to maximize our launches as we talked about today with prelaunch inventory build. And then on the financial side, we do incorporate monetization of 3 PRVs, so from UX111, DTX401 and UX143. We’ve talked about in the past, if one of those wasn’t to come to pass, that we think that the aggregate value of the others would get us to the same cash point.

And of course, today’s financing that we announced bolsters the balance sheet. But in aggregate, we think that all of those levers will put us on our path to profitability in ’27.

Operator: And your next question comes from Maxwell Skor with Morgan Stanley.

Maxwell Skor: Great. So based on your KOL interactions, how do physicians think about potentially initiating setrusumab, for example, prioritizing younger patients versus those with more advanced disease? Some checks we’ve done indicated earlier use in younger patients, but just wondering your thoughts and feedback from the community.

Emil Kakkis: I think if we demonstrate the strong fracture effect across the age range, I think that it’s very likely the earliest adoption will be the patient with the most severe disease. And I think for many, that will be the type IIIs and type IV patients. We’d expect a higher fraction of those patients to get treated, and many of them are affected at a younger age. But really, at any age, if they’re Type IIIs and IVs, they have a more severe phenotype. Within Type I population, there may be a range of spectrum. There’s a significant fraction, maybe half or more, that have enough fractures to be really a detriment and for which even if they’re not having fractures there, a change in behavior, their avoidance of activities or the sedentary activities are a problem that they would still want to get treated.

So I think the area where most KOLs would wonder about is on the milder Type I patients, but a lot of these patients are not even diagnosed very efficiently. So we do think that it could shift younger, but I would say from our experience in Crysvita, we see growing and growing use in adult patients because even in OI, there is substantial effect. They may have less fractures, but they still have bone dysfunction that is hurting their ability to enjoy life well. So I think it will be used across the spectrum, but I would expect younger and more severe patients to get more immediate access compared to others.

Operator: Your next question comes from Jack Allen with Baird.

Jack Allen: Congrats to the team on the progress made over the course of the quarter. Two quick ones from me. The first of which was on R&D. Howard, I apologize, but I think your remarks are a little choppy for those on the line at the top of the call. I was hoping you could dive in a little bit more on the third quarter R&D, and you referred to some prelaunch manufacturing spend there. How should we think about that in the quarter and then the run rate moving forward on R&D? And then just briefly on osteogenesis imperfecta, I was wondering how you guys are thinking about the commercial opportunity there as compared to maybe XLH and your prelaunch efforts and I guess, analysis of that market.

Emil Kakkis: Okay. Thank you. I’ll touch on the commercial, excuse me, if that’s right. Actually, Howard, why don’t you do the R&D first?

Howard Horn: Yes, Jack, you got it. My point that I was trying to make there is in the quarter, the $216 million for R&D expense, it came up a little bit. I mean, I guess, it was a diversion from our trend, and I wanted to explain that, that was related to investments in prelaunch inventory and getting ready for these launches. So that’s the point I was trying to call out. And apologies if the line had garbled. Emil, over to you on OI.

Emil Kakkis: Yes. So in OI, when you look at the population and our view of the OI population is that they’re probably 50% to 100% larger than XLH based on our discussion with KOLs. We see a lot of patients and have a big sample size. We think of pricing is probably similar to our Crysvita program, so we’d expect that the OI opportunity is larger than our XLH program.

Operator: And your next question comes from Joseph Schwartz with Leerink Partners.

Will Soghikian: This is Will on for Joe. Congrats on the progress this quarter. I just have one question on the Angelman program. Considering there are multiple ASOs in development here, we might be in an environment in a few years where there are multiple approved options. While it’s difficult to envision how the competitive landscape might shake out, can you help us understand how the patients, parents and caregivers for this disease may be making their treatment decisions? Is this something purely driven by the overall data? Or are there other attributes such as dosing schedule, specific end points, safety, et cetera, that are driving these decisions?

Emil Kakkis: Thank you. An interesting question. Of course, there’s a lot of unknowns and what will actually play out. In our mind, right now, our ASO is the most potent and has shown the best long-term data. I think in the end, the data will speak to parents as to what is important. With regard to how they make decisions, we’ve certainly talked to a lot of parents and understand what their views are of patients. I would say to you, there’s no interest in knowing what the primary versus secondary end point or other end point. They want to know how their kids are doing, and it’s broader than picking one thing. We will have all the end points. And I think the end points across the different programs are broad enough and cover enough of the same domains for parents to be able to tell.

With regard to the schedule, I think that both programs in the long term are ending up in at least — the Ionis program, our program are both in the Q3 kind of scheduling down the road. I think it’s going to be more about — I don’t think the schedule itself is going to matter or if there’s a load or not. I don’t think that’s going to really alter it. It’s going to be more about potency. The other thing I think important is our patient support programs and how we help patients with treatments. At Ultragenyx, we have, I think, one of the best support programs to ensure that people can get access to drug, and they maintain access even when they change insurance and other things. So we’ll help support patients to achieve their access goals and getting treated.

So at the end of the day, I think the potency and safety will matter, will be the most important thing. But if there’s multiple products out there, it’s how we handle the administration and support for our patients will have a big impact on what works. And the last thing I’ll point out is that we are rolling — rolled our Phase III and moving along very quickly, and I feel we will have the potential to be out ahead of other ASOs. But let’s see which one is best, and I think patients will probably opt for the best one when the trial is all done.

Operator: Your next question comes from Anupam Rama with JPMorgan.

Joyce Chang Robbins: This is Joyce on for Anupam. Maybe just one from us for GTX-102 following up on Angelman. Realize here that the Aurora supportive study has only just started enrolling. But how should we think about the enrollment curve for that trial relative to what you observed with the pivotal Aspire trial?

Emil Kakkis: Thank you. The Aurora trial, we actually expect to enroll pretty quickly. There’s a lot of patients lined up for it. We haven’t set a precise time line for enrollment, but we were impressed with the speed of enrolling into a sham-controlled trial. This trial is actually open label. I think that I’m expecting competition to get enrolled in the trial, and so we expect it to go pretty quickly. I think it’s going to be an important study though for — open up our understanding of treatment safety and efficacy, both in a wider array of genotypes. So we do think it will go quickly, but we haven’t set right now a time line specifically for it.

Operator: Your next question comes from Yaron Werber with TD Securities.

Steve Scala: Congratulations on a great quarter. This is Stephen on for Yaron. Just one on OI. How are you thinking about the length of a course of treatment for setrusumab. We’ve heard different KOLs say different things about exploring bisphosphonates in combination or in cycles with setrusumab just based on the relative effects because setrusumab might build more bone mass, whereas bisphosphonates have a more freezing effect. Do you expect the majority or all patients to be on setrusumab continuously? And then secondly, whether there’s any concern about bone pain from folks switching off of bisphosphonates that you’ve heard of anecdotally?

Emil Kakkis: Yes. Well, I’ll give you my more personal opinions, and I think bisphosphonates are going to become obsolete. I think they don’t create good bone. They hold bone densities that exist. But I think the anti-sclerostin approach is enabling normal bone metabolism, bone creation and bone resorption but better balanced. And I think in the long run, the paradigm of building bone with an anti-sclerostin and then capturing or locking it in with bisphosphonates, which has been established in the osteoporosis world, will not be the right answer for OI. And we have patients now on a couple of years, and we are confident that chronic therapy is actually necessary in order to maintain the gains in bone they have achieved and to keep bone healthy.

I think the FDA even has its own concerns about bisphosphonates because — of long-term bisphosphonate use, seems to result in more fractures or problems because of the altered structure. So we’re trying to break through the paradigm of 1 year of anti-sclerostin and then bisphosphonate lock-in. I think that model is for a different disease state and a different time. And I think everything we’re seeing says this is a chronic treatment and that by maintaining anti-sclerostin treatment, what you’re really doing is dialing up the balance between bone production and bone resorption to the proper place in a disease that drives that dial normally down toward resorption and away from bone production. And that dial needs to stay where it needs to stay in order to keep the patients with a steady state, of high-quality bone without using a bone poison to prevent breakdown of bone as a strategy.

So in my view, setrusumab is future and bisphosphonates should probably become obsolete for OI.

Operator: Your next question comes from Salveen Richter with Goldman Sachs.

Unknown Analyst: This is [ Lydia ] on for Salveen. Maybe just another on OI. Could you just speak to any statistical work or study design changes you’ve made post the second interim analysis?

Emil Kakkis: Well, I don’t believe we made any. But Eric, I don’t know if you — Crombez, if you wanted to have any thoughts. I don’t think there were any — I’m not familiar with any changes at all.

Eric Crombez: No, no, no, the statistical plan remains in place. We did take the opportunity to really verify our assumptions, verify our statistical plan and all of our modeling and rework really told us the plan we had in place is the right plan and really giving us a lot of confidence going into a final data readout.

Operator: Your next question comes from Mahdi Goudarzi with Truist Securities.

Mehdi Goudarzi: This is Mahdi on for Joon. Following previous questions on OI. Given Cosmic superiority studies in younger, narrower population, what are the scenarios if it misses and even if Orbit hits, what are the impacts on adoption of the drug?

Emil Kakkis: Yes. Well, the trial — thank you. So the point is that Cosmic is head to head against bisphosphonates and it has to be superior. First of all, I don’t think bisphosphonates were — in those patients had to be — they were on bisphosphonates before they started. So we’re crossing over onto our drug. I believe the bisphosphonates benefit, which is only about 20%, is relatively modest, so we actually are not concerned about it. But the question is the trial being smaller, for whatever reason misses, what does it do? We’ll still have the safety bone mineral density data from that population, which I think would be supportive for allowing a label that includes that age group even if we can’t be superior to bisphosphonate.

Particularly, remember, in the U.S., there is no requirement to be superior to another treatment for approval. The treatment that what — would have an effect on adoption, I actually don’t think it would. I think people will see what’s happening. I think the little kids have terrible bone density problems. And I think seeing the big picture across the age group, I think, will drive adoption on all age groups. So I appreciate the question, but I do think that, at this time, I don’t think will have a major impact either way.

Operator: Your next question comes from Raj Selvaraju with H.C. Wainwright.

Mitchell Kapoor: This is Mitchell on for Ram. I wanted to ask about if you could just talk us through how the Crysvita transaction came to be and if there’s a threshold at which you view a mature product is better used for monetization for capital recycling into the pipeline versus the recurring income from the product.

Emil Kakkis: I’ll start and then let Howard talk. I mean we’re always looking for the most efficient cost of capital. And in this case, the valuation people placed on the Crysvita royalty was excellent, and we did well that way. But I think, in general, we’d want to try to keep our revenue streams and not do this, but I think we’re just at a critical moment here. But for us, with 3, potentially 4 products launching in the next couple of years, we’re going to be in a very different place very soon, and we won’t be — need to be talking about this. But maybe, Howard, you can touch on how the Crysvita transaction came together.

Howard Horn: Yes. We evaluated a number of different things. This was a competitive process ultimately where we’re looking — what we were looking for were meaningful proceeds at the lowest cost of capital to minimize the P&L impact of interest expense while also maximizing our cash preservation. The payment holiday helps with that and these other terms help with it. But as Emil mentioned, we thought that we could take some future-dated revenues and pull them into today to bolster our balance sheet to make sure we had what we needed to launch up to 4 programs in the near future and to put us on our growth path that we expect.

Operator: Your next question comes from Laura Chico with Wedbush.

Unknown Analyst: This is [ Thomas ] on for Laura Chico. Perhaps one question for 701 for Wilson disease. Can you discuss what you will need to see from the fourth cohort to have confidence in advancing the fourth to the [ 13-hour ] dose into future studies?

Emil Kakkis: Yes, thank you. So I’ll touch on it, and Eric, I don’t know if you can add a little bit more. But I think if you can do a gene therapy, you want to see a substantial effect in the majority of patients, right? We want to see something that’s compelling. And what we’re doing right now is increasing the dose to try to help enhance the fraction of patients that see that kind of effect. We’re excited about what we’re seeing and where there’s some data being presented soon. But Eric, maybe you can talk about what you want to look for in the data for Wilson as we make that decision to go to Phase III.

Eric Crombez: Yes. No, and I think it’s important to stress that, first and foremost, we are looking for the majority of patients to come off of current standard of care, which is chelators and zinc. And Emil mentioned increasing dose. We also are changing our immunomodulation program. So we think that those changes will be at least additive, if not, synergistic with improving or really maximizing the efficacy we see with this gene therapy. So saw great results that we’ve presented externally so far, and we were close to that mark. We did think it was worth taking this extra time to do this cohort to try to get the majority off of patients. And what’s nice with Wilson and looking at copper is you have a lot of different ways to measure copper, so I think we will be able to make a clear decision there.

Operator: Your next question comes from Luca Issi with RBC Capital Markets.

Shelby Hill: This is Shelby on for Luca. Can you just remind us how we should think about loss of exclusivity for setrusumab? This has obviously been a long journey for this molecule given it was originally developed by Novartis, the Mereo and finally, you guys. So I believe some of the initial IP actually expires at the end of the decade in 2028. Is that the foundational IP, so a biosimilar can, in theory, come soon after that? Or do you have additional IP estate that can maybe push out the loss of exclusivity to a later time point? Any color there, much appreciated.

Emil Kakkis: Well, thank you. I think we’ve always looked at the whole exclusivity story as being really important. I think we have, of course, orphan designation, which would give us certain protection, which is well past 2030. So I’d start with that. So that’s the first part of the story. Second thing, even if there are — if there were no patents, the truth is that biologics like that rarely change. And the follow-on biologics may occur, but I think that it would be different from what typical loss of exclusivity. The — I don’t think I can go through all the details of the patents that protect us now for the program. There are also additional things we are putting together related to our discoveries of how to treat, how to do chronic treatment and other key things.

So our — we feel pretty good about where we’re at right now. But you’re right, molecule has been around a while, and it was being developed for OI — I mean, osteoporosis in the past. But I think a combination of drug exclusivity and our expectation to have some IP protecting it should put us in a good place to take this program forward.

Operator: Your next question comes from Sami Corwin with William Blair.

Samantha Corwin: I was curious if you could walk us through, again, the rescue arm in Orbit and how that’s factored into the statistical analysis plan. And then as you got conversations with neurologists, how are they kind of viewing utility of the Bayley-4 cognition versus Bayley-4 communication?

Emil Kakkis: So the rescue arm — the point of the rescue arm is that if a patient was having a lot of fractures and a lot of PIs are worried, if they come in the trial off the bisphosphonates and have a lot of fractures, they’re sort of stuck in the trial. They’d have to withdraw. The kid was doing badly. So we’d offer them that they could rescue if they have a large number of fractures, seeing certain number of fractures. But they do have to be in the trial at least 1 year. And then after that, they could rescue. The idea then is that with a 1-year sample time in a higher number of fractures, we will have had enough time to assess their AFR, right, and determine their annualized fracture rate, right? If you have a lot of fractures, then a 1-year time frame is enough to make that — the estimate of the AFR.

So if a patient goes into the rescue arm, we include all the time that they’ve been on drug as included in their analysis and estimate their AFR from the time — the sampling time. Does that make sense to you? So because we’re doing an annualized fracture rate reduction, we just need a sample time that’s adequate estimate of their true fracture. So that’s the way it’s working. But it was a necessary part of doing the trial and because doctors couldn’t keep patients off bisphosphonates indefinitely and have a tremendous amount of problems. And rather than having to withdraw, it’d be better to find a way to keep them in the trial and cross them over. So thank you for that question. The next question was on the utility of Bayley-4 versus — cognition versus communication.

I will say to you, honestly, it doesn’t matter what the primary end point is because I’ve never talked to parents in how — they don’t ask me what the primary end point of trials are. They — you might talk about what you’re measuring, but they are never going to depend on primary or secondary to make decisions. They want to look at all — the whole story. And that is what we’re going to provide, the whole story. We will have a receptive and express communication in our program. We’ll have answers for that, and we compare them. And the idea of what you position first is it’s more of a regulatory thing, has, I think, limited value and at least in rare. I know in other big market diseases, the primary end point and its exact crafting turns that into a big deal.

But in rare, I have not seen it happen. It’s not really mattered because people will look at all the data and incorporate it. Our plan then is to focus on the Bayley-4 cognition. We saw the best effect. It’s a fundamental brain function issue. But we’re also looking at the rest of the communication and other end points, one, through the multi-main responder index and then through individual secondary and tertiary end points. So we’ll be able to speak to all the issues, all the end points and be able to provide comparisons between the products as well. So I think that’s why I’m not as concerned about what people chose as primary. We have to do that for regulatory purposes. But in the real world, I never went to my doctor and said my primary end point is this, but my secondary is this.

And what can you do for me? And no one ever speaks that way. So I’m really comfortable with what we have. We’re covering every domain, and I think I feel good about the type of data we’ve seen so far in our expansion study. Patients make me confident that we’re going to see changes in communication and cognition and sleep and behaviors and fine motor and expressive. That will be, I think, an amazing future for Angelman patients, frankly, because who could have thought we could change a kid with severe developmental delay and actually start causing their brains to develop. I think it’s a miraculous situation. We’re really proud to be part of it.

Operator: And your next question comes from Gavin Clark-Gartner with Evercore ISI.

Gavin Clark-Gartner: Just wanted to ask on the ongoing Aspire Angelman study. Is there any commentary you can make on the variability you’re seeing, any of the blinded data, any of the baseline characteristics, really just anything that gives you confidence in the ongoing study?

Emil Kakkis: Well, the study is going well, and we’re confident. We normally do not talk about data on a trial when it’s ongoing. I don’t know, Eric, if there’s any high-level color you can provide and the patient population. I believe they’re very similar to the expansion patients we’ve already reported on.

Eric Crombez: Yes. No, exactly. And I think that’s important. We don’t bring untested things into Phase III and really carrying over our learnings and understanding from Phase II. So same entry criteria, same end points, same patient population and again, looking in Aspire for patients with full deletion. So those are patients, really expressing no protein, very consistent phenotype and the most severe end of that spectrum. So we do anticipate very consistent results just to what we saw in Phase II.

Operator: There are no further questions at this time. So I’ll hand the floor back to Joshua Higa for closing remarks.

Joshua Higa: Thank you. This concludes today’s call. If there are additional questions, please contact us by phone or at ir@ultragenyx.com. Thank you for joining us.

Operator: Thank you. All parties may now disconnect.