It's a long way to say, yeah. All right. Let's get started here. Welcome everyone to the 2025 Wells Fargo Healthcare Conference. My name is Derek Archila. We're going to be kicking off today with Ascendis Pharma. From the company, we have Jan Mikkelsen, the CEO, as well as Scott Smith, the Chief Financial Officer. The company's been executing and firing on all cylinders on the YORVIPATH launch. You know, lots to talk about. Jan, maybe just to start us off, kind of give us the state of the union here. Where are you? How are you thinking about things? Then we can start digging into the Q&A.
Thanks a lot. First of all, thanks a lot on inviting us. It's always a pleasure to be here. Where are we? In a pretty good place. We have now, from our TransCon technology, this is the platform we are using to develop all our internal product opportunity, but also the external product opportunity we, for example, have in our collaboration with Novo Nordisk in metabolic diseases and obesity. We have now advanced what I call the first pipeline, and that was starting with SKYTROFA. Now, YORVIPATH is approved, and now we have the third arm. This is TransCon CNP, where we have the priority review here end of November. The first pipeline had given us the opportunity to really develop what we call a leading biopharma in rare diseases. Our aspiration is really, really simple: three independent product opportunities, all of three addressing a major unmet medical need.
We are now taking the next three or four years in really developing label expansion, developing for each of the new chemical entities in the pipeline itself. At the same time, we are developing what we call the next generation of new compounds that really address, at the same as the three first, major unmet medical needs, built on the TransCon technology, both inside rare disease endocrinology, but also outside. When I look at the perspective of Ascendis Pharma, we are for the first time come to this stage where we have revenue generation, which are increasing quarter by quarter, really as we have expected, as we have planned. We are coming to this extremely, what I call, pleasant situation to be independent on the financial market and can generate a positive cash contribution quarter by quarter.
Got it. Maybe let's start off with the YORVIPATH launch. It's very topical and going well. Maybe just talk about how you think you've talked about this $5 billion potential peak number for YORVIPATH and hypoparathyroidism. What gets you there and what sort of moats or kind of competitive dynamics do you expect in that market over time?
When I look at YORVIPATH, this is our product that is in the medical era of hypoparathyroidism, meaning patients that really have a severe disease where they don't have enough endogenous PTH produced. What we are providing is replacement therapy, where we are basically providing the right mode of action, the same as the endogenous PTH, in the same physiological level, 24 hours, seven days a week. When we look at a product opportunity, you have a lot of different strategies to think how to launch it. When I look at YORVIPATH, it's pretty clear we have extremely strong IP protection up to, I think now it's up to 2042. At the same time, it's a combination product, meaning that they don't have the same fear of a cliff when we come to the end of 2042. It will have a long durability.
What we are doing is we take the area under the curve strategy, how we really can, for the next 20, 30 years, build the most value of this product opportunity, both inside the U.S. and ex-U.S. Let me first start with the U.S. In the U.S., there's about 80,000, 90,000, perhaps 100,000 patients that already are diagnosed with having hypoparathyroidism. If any one of you has any doubt about this unmet medical need, try to listen to the YouTube of the FDA-arranged hypoparathyroidism session. It takes about three hours, but I think it's really an eye-opening if you have not really talked with a patient about this unmet medical need. When you hear the story from a few patients that also are on YORVIPATH, then you can understand how it changes their life.
Not only taking account of the long-term risk, but also the short-term symptoms like feeling better, can do normal work, live like a normal person. Don't forget, 70%, 80% of these people had a normal life until basically they came to a situation where the endogenous PTH, because often a head and neck operation, came to a situation where they didn't have enough of that. We are taking the concept that we have a product that will have extremely many years. When we look at the competitive landscape, it's clearing out. We don't see any other product opportunities in clinical development that can provide the same benefit as YORVIPATH. This is why we focus on really the long-term effect. We see a steady, steady growth. Yes, you can say there was a bolus in the first quarter, a bolus from about 220 patients that came from our ERP program.
When we take these 220 patients off of Q1, which I will call a bolus because they already were on treatment, and then look on what we saw in both Q1 and Q2, and that was what we came out with our Q2, we see an extremely stable growth. That is really how we have designed our commercial effort. What we also said at that time, we expect that to continue the rest of the year. This is what we see. Don't forget ex-U.S. Ex-U.S., we have a more diversified strategy. It's built on mainly three pillars. One is what we call the direct market. It's about 13, 14 countries that are direct. The three countries where we already are full commercial in the direct market are Germany, Austria, and Spain. We hope in 2025 to get two, three more countries on it.
The majority of the 14, 15 countries, we will get them on board in 2026. We have our sales and distribution agreements. To date, it's mainly being built up on a named patient program where we have revenue generation for about 30 countries. Our entire distribution agreement and direct market is around + 50 countries today and expanding and expanding. The last pillar is our partnerships. Our partnership, you can see that our Japanese partner, Teijin, just got marketing approval for YORVIPATH now in Japan. That will start to go commercial later this year. Because of the, you can say, diversity in how a commercial time schedule is developed ex-U.S., you will see during the next five, six, seven years how we really are going building up the commercial effort, the revenue generation for all the ex-U.S. The key element, we will be where there are patients.
That is what we have done in our global commercialization effort of YORVIPATH.
How do you think about the breakdown geography about the peak sales opportunity? You said, again, $5 billion, but how is that split between the U.S. and kind of the rest of the world?
That is dependent on the time horizon. If I take the first of up to perhaps four or five years, the majority will come from the U.S. After four or five years, I actually think it's switching over because you'll see the ex-U.S. global effort is really starting, going up, running at much larger speed. This is why we believe that the revenue generation will continue, continue for many, many years.
In the U.S., in the launch, what are you seeing that's kind of driving the most uptake? Is it just, you know, awareness of a new therapy, or is it just kind of, again, physicians using the drugs, seeing great results? What's kind of been the near-term driver, you know, quarter -over -quarter in terms of physician uptake and more, you know, patient penetration?
That's a lot of different elements in a lung when you think a person having a disease, they're already diagnosed. We know that. They have in their head, I have this disease, I need a treatment, and until they go on treatment. I think this is a heterogeneous journey for so many different patient stories. What I see today is really a steady, steady flow of new prescribers and new prescriptions being written and basically the flow to the system. We expect in the end of the year, because we're getting up in the fourth quarter of the lungs, that a lot of infrastructure from the physician office to everywhere in the system, how to make a fast transfer from the patient from the prescription up to be on drug will improve in this way.
What I see today, which we also see in many countries, is that basically the bottleneck is basically to go into an endo and get a prescription. This is why we basically have this constant flow of patients month by month, quarter by quarter, because the number of endos is not changing a lot. That basically are the main prescribers of the product. We can improve that, which we also start to improve that. We can go outside the endo as target physician, nephro, and other ones. We also see a lot of, you can say, hypoparathyroidism patients. That's the way when we come to the second wave, third wave of this year, where you will see we can improve the number of prescriptions.
Gotcha. Basically, it's just that time from script to getting on drug. That's what needs to improve over time, which typically improves while the launch progresses. Is that fair to say?
That is fair to say. It's what we have observed in basically nearly every launch.
Gotcha. A question we often get is just around, obviously, competition. I know you kind of said that's starting to clear up. One of the questions is really centered around, like, is there really a need for a longer-acting, you know, again, like a weekly formulation versus daily? You have the TransCon technology. You've done a lot of daily to weekly kind of transformation. What's your view there?
Yeah. You can say the first obvious question you can ask us is that you made a once-weekly growth hormone, SKYTROFA. You made a once-weekly CNP product. Why did you not make a once-weekly PTH product? We did it after a lot of considerations. It comes back to potentially my background and a lot of other people's background from the last pharma company that worked a lot with diabetes, insulin treatment, type 1 diabetes. We are working with an extremely powerful hormone. No one will ever consider, why did you not just make a once-weekly insulin from the beginning, even if you can do it? We wanted to be sure that we can stabilize a patient first on the right doses. We wanted to consider, are there sufficient enough stable patients that do not titrate up and down?
There is a lot of influence on your work capacity, how hard you work, how much you exercise, if you have diseases, what is really your need for PTH? Also, what is your intake of dietary calcium and other things like that? We said also, we are in a situation where there's not an antidote to PTH. It's not like insulin, you have rescue therapy with glucagon. What do you do with a patient that gets too much PTH? Suddenly they don't need it too much. There's not anything else to do, stop taking the medication, and then hope it goes down. That was why we never felt secure to have a once-weekly starting product in this way. That was why we had the overall strategy, start with a daily product, really optimize it.
When we are in a position that we're feeling that there is a sufficient enough stable patient, and there is a large unmet medical need for that. My question is still, what is the last unmet medical need? We see excellent adherence. No one is dropping out of therapy. Everyone basically continues when they're getting started. I think the barrier for treatment is very low. We have one of the best pen devices. It's pre-filled. It's room temperature. You just take the pen, take two minutes to make the injection, and then you have done it. It's not like taking something out from the fridge, get it up to room temperature. We can say the treatment barrier is pretty low for that. Will we one day make a once-weekly product? Yes, if we're convinced that there are sufficient enough stable patients.
How do we define the stable patient is that you're not going up and down a lot in less than three months. You need basically to be in three months stable on one dose. We see about perhaps 30%, 40% of the patients in that. What we do not know is that continues during the year, and that is all the data we collected to that. We are ready for a once-weekly product, but we see a once-weekly product is in combination with a daily product. You potentially will have a basal level of PTH, and then you can add in by a daily injection. It does mean that you always can be sure you're covered with a basal PTH level. That was our thinking behind when we made YORVIPATH as a daily product and not started with that as a weekly product.
Just think about how to titrate a company when you need to go out on what we call a calcium supplement, active vitamin D. You need to titrate a lot the first two, three, four, five, six weeks. It really, really will be tough with a once-weekly product.
Just remind us, obviously within the context of that titration scheme, you're really trying to, I guess, mitigate any sort of safety issues, right? Maybe just talk about some of those issues that could arise with a weekly in that setting.
If we had cases of a hypocalcemic episode where they came up to a level where it was out of the range, what happened with them, we actually could control them just by getting what we call, like not taking medication for the next two to three days. We saw it coming down slowly. We basically avoid any emergency part of having a hypocalcemic episode.
Gotcha. Gotcha. Maybe shifting gears to TransCon CNP. Another exciting thing, as you highlighted before, FDA PDUFA date coming up towards the end of the year. Again, how do you think about the differentiation versus BioMarin's VOXZOGO, and ultimately, you know, your preparations to launch? What should we expect after the PDUFA?
Yeah, first of all, both products are being built on CNP as a mode of action, but a lot of difference between that. BioMarin's is a variant of CNP with mutation in it. We have wild type CNP, the natural form of CNP. We are in a position that we developed it to be highly differentiated to the established, the resource type. We did it by doing a continuous exposure, 24 hours, seven days a week. It looked like people now also coming back from all other aspects are saying this is the optimal profile to develop that. At least that is what we're hearing from BioMarin. They want to develop a product like us, which I think I'm a little bit proud about. It's a little bit sad it took eight, nine years to realize that.
From my perspective is what is the differentiation you get with the continuous exposure? I can start with a lot of different things. The product technology provides that you don't get injection site reaction. This is one thing. This is something that patients, the caregivers really think about a lot. If you have two to three times a week on average major injection site reaction in a child, instead of having one every seven years, this is because of the product technology. The sustained release of our product technology gives that we always have a constant level without a peak, meaning there is no risk of hypotension. That is a major differentiation compared to anything like that. We go to efficacy. What we have shown as the only company in our pivotal trial compared to placebo, we have meaningful clinical effect beyond linear growth.
What I'm really addressing here is the positive effect we have seen, both related to elements like leg bowing. When we see patients, subjects with achondroplasia, really are in a position that they need to go on severe operations for up to one year just to correct leg bowing because of the pains and other things that are associated with that. We saw a correction of that, first time ever seen. We saw improvement in elements like muscle strength, which we actually addressed to the continuous exposure always of it. We saw change in how the spinal cord is going to vertebrae, expanding and everything like that. We could address this benefit we saw from, for example, X-ray, radiology, really to quality of life improvement. We can address the ones that basically have most improvement, also have the most improvement in quality of life.
Meaning is that it's really a meaningful differentiation you see in this way. When I come over to the product itself, I feel it's really providing what I would call a transformative treatment to it. I think that's why we also have achieved priority review by the FDA and are pursuing some of the same thing in the European way. I think it's not only us that recognizes it, it's recognized by physicians, but at least, and more important, it's recognized by patients.
In terms of the launch strategy, is it more of a switch strategy from VOXZOGO initially? Like, how do you guys want to, I mean, obviously you've got great differentiation, but how's kind of the positioning upon launch?
I think this will be like a part of YORVIPATH, completely different combined to think about. People thought when we launched YORVIPATH, there would be somebody just the same kind of that part, completely different. There's only 15%- 20% of physicians that ever have made that part of the prescription. Everyone is seeing this product as a completely new treatment thing. I think both patients, parents, physicians see the same thing with our TransCon CNP because it provides clinical benefit beyond linear growth. We don't see being short as a disease. We see the comorbidities as the severity of having achondroplasia. If we can help people with achondroplasia to really address this comorbidity, we believe we have a major way to work together with them and really establish this as a standard treatment in it. We are not just looking on naive patients.
We are not just looking on switch patients. We are looking at every patient that wants to have a treatment.
Is your view that some of the comments in terms of the differentiation will make it on the label, or do you think it will just be similar to what we've seen with kind of the VOXZOGO label?
For me, it's not really so much the discussion on what is going on the label because that's something we do in the end with the FDA. I cannot really comment on that. What I can comment on is that we have all the clinical data that would come out in peer reviews, manuscripts, and everything like that, that's really proving the data. It's not only proving it by making publications. This is also the patient story that gives me the confidence that we're making a major differentiation compared to any other treatment.
What do you think in terms of, you've kind of set some, you know, guideposts around peak sales for YORVIPATH? What do you think about, you know, CNP maybe as a kind of a class, but maybe TransCon CNP specifically? Where do you think that nets out in terms of peak?
Yeah, TransCon CNP is one of the cornerstones in our growth disorder strategy as SKYTROFA is. You will see part of SKYTROFA where we do label expansion in all the established growth hormone indications in a new basket trial. We're really building up SKYTROFA to a blockbuster status. We're doing that also in combination with TransCon CNP in our COACH trial. Later or beginning next year, you will see the one-year data of the COACH trial. I will say this is one of my proudest moments in being part of developing drugs because when I saw the clinical after six months, I never thought that would be possible that it would be by combination treatment, taking an achondroplasia child, and basically provide growth that is much larger than what you will see on a normal child in a growth spurt. This is what we're seeing.
This is unbelievable from my perspective. That is really, but it makes sense from a biological system. When you remove a brake and press a speeder, yes, you go faster. If you just remove a brake, there's a limit to the speed you can get depending on the hill. If you really remove a brake, press the speeder, then you have really a completely new treatment regime. We believe that when we look on this pillar, when we go to hypochondroplasia, combination therapy, because some patients will benefit most from growth hormone, some will benefit most from CNP, and some of them will benefit most from the combination.
I think this is where we have the fundamental really, really to be the leader in growth disorder because we're the only company that really can provide the clinical benefit of the two products in a once-weekly dosing profile and all the other benefits both products have in this way.
Do you feel that based on the data from COACH and hopefully replicated in a phase three, that will become standard of care in achondroplasia? How do you think about the FGFR3s, like if BioMarin got in that space as well?
For me, it's very hard to see where the tyrosine kinases really fit into this treatment regime. It was product opportunities I know most from the oncology setting where they have seen them. Not really successful in oncology because of the safety efficacy risk that was inherited into that. I'm still struggling with my fundamental scientific view about how can you really inhibit not only the FGFR3, FGFR2, and FGFR1 because many of them are unspecific and some of them are specific on the receptor, but then on the cellular layer, you never are specific because you interchange the receptors. Out from that perspective is that I don't care about phosphate. I care about the long-term effect of this kind of class.
How can you think about you can inhibit some of this fundamental essential development part of a child during all this age independent on or with a limitation of the normal FGFR1, 3, 2 or 3 receptor activation? I still have some fundamental problem with that in this. Not the short term, long-term effect about that. This is where we believe that the CNP therapy is really proven, proven, proven to be safe. If I'm a parent for four children, if I have a choice, I will always select a safe solution.
Got it. I just wanted to shift gears to your partnership with Novo Nordisk and on TransCon semaglutide, and just, you know, what's the status of that and ultimately, you know, any of the changes that are going on at Novo Nordisk impacting that collaboration at all?
We're not seeing any changes, and they're exactly as dedicated not only to develop a semaglutide but also other products as they always have been. It's a great correlation. I believe that Novo Nordisk is going to be and continue to be the leading company in both obesity and metabolic diseases. They have the pipeline to do it. They have the strengths to do it. They have the production capacity to do it. I think there was no doubt they were the right partner for us.
Gotcha. In terms of your strategy there, I think we talked about this, but is it more about being able to push and get more weight loss or more on a tolerability front in terms of how you think about the positioning of a pure, you know?
Yeah. Our most recent semaglutide was not being developed as a convenience drug. It was more developed on one that gave, you can say, benefit to manufacturability capacity, but at the same time also would have an improved tolerability. You can see that when we disclosed this, it was built to have a slow onset from the trough to the peak, which is really giving the tolerability issue. That was how we designed the product opportunities in this case. It's been used to improve the tolerability. You can say, would that mean you can get better weight loss? Yes, obvious, because you can press the button much tighter on because you can just accept to have some kind of tolerability issue, because the tolerability issue is the limitation in getting just the first three months weight loss.
You have kind of, you know, put out there potentially that you would have maybe no titration. It would just be flat dosing. Is that still probably the expectation, or how do you think about that?
I think this is where Novo Nordisk, with their development expertise and their way to position the market, actually will come up with the best solution how to position this product.
Gotcha.
I'm just sure that our product is providing the benefit where they have basically the menu to do different elements to get their competitiveness into the market.
Gotcha. Maybe one just on the broader platform. I guess, you know, you've got three great, you know, endocrine-focused therapies. You've got some partnerships. I guess where else do you want to kind of take the TransCon platform? I guess when could we hear about, you know, newer programs beyond kind of just indication expansion, but, you know, maybe potentially new indications and new targets?
Yeah. This is what we have a strong focus on now. First of all, the TransCon technology has developed a lot. We first started in what we call the classical TransCon technology where we coupled it to polymers. We went into basic coupling to hydrogen, which is spun out in a company called Eyconis that really is doing extremely well in ophthalmology. We have our TransCon technology, which was built on the [alpha mine avidity]. This is where we see the collaboration with Novo Nordisk. I'm just giving you a key point for each of the technology platforms because all of them have brought applicability. The latest part of the TransCon technology is the degrader platform where we basically can utilize the TransCon degrader technology to go into indications where there is surplus, surplus of, for example, hormones, ligands, and other things, and remove them.
This entire, you can say, strong TransCon technology is not limited by any kind of therapeutic area. As you know, we have been focused on rare disease endocrinology. It's where we have our commercial infrastructure. This is where we have our commercial arm on a global basis in rare diseases. We're developing about eight to 10 different product opportunities in that site and building up from all the different TransCon technology platforms. That is something we're maturing now because we know in the next four or five years, we will have so huge effort on about 15, 20 clinical trials in label expansion because we really need to get the benefit out of all our three unique product opportunities. We start to take up the new chemical entity in late-stage development at that time. This is how we can build Ascendis to sustainability.
We're not dependent on going out and buying anything. We can develop it. We will still also focus on making out-licensing, as we did with Novo Nordisk, in large indications where we, for example, do not have interest to pursue from a commercial perspective like primary care. We have said we are now starting an effort in cardiovascular, and we believe we can do the same thing as we did in metabolic disease, what we did in obesity. We will do the same thing in cardiovascular diseases.
I'm going to get Scott in here. As you guys now kind of, you know, profitable launch, how do you think about the cost base over time, particularly given, you know, some additional potential programs, whether it be in, you know, similar smaller indications or larger indications? How do you kind of think about that evolving, you know, over the next couple of years?
Yeah, I think we've been pretty cost-efficient throughout the history of Ascendis Pharma, even at the unpicked growth hormone for our first product, which was by far the most expensive, actually twice as much as the other two combined. I think that we looked to...
Thanks, Scott.
It was good practice.
Most difficult first.
Left me on your toes.
I think what you've seen, the great thing with the TransCon technology is that we have a high clinical success rate, a high regulatory success rate, and CNP and PTH have been very efficient to bring forward from preclinical through to the clinic and finally to approval for one and hopefully two of those. From my perspective, I think we continue doing what we're doing, invest more in the pipeline, as Jan sort of alluded to. Rather than maybe three shots on goal, we expand to maybe up to even double-digit shots on goal in the near term to continue the growth beyond 2030.
Gotcha. How do you think about earnings power, like how they're going forward as well? I know that's a question that's creeping up more among investors, but how do you think about that evolving over the next two to three years?
Yeah, I mean, I would say it's interesting. We're at the corner right now, and I think next quarter or two, maybe we turn the corner. As you saw from our financials in Q2, we actually generated cash from operations due to some liberation day currency. It didn't help our cash balance, but we actually generated cash from operations. I think that, you know, as we make the complete turn around the corner, we'll look for uses of our cash. That primarily will be to serve patients. I mean, I think that's where we have to, when we think about capital deployment, our main goal is to help patients first, and we'll look to do that.
I know Jan was talking about, you know, potential like other iterations within the YORVIPATH launch and maybe reaching other physicians. Is that really driving for medical spend, or is it pretty modest, or is it, you know, kind of all factored into what you guys have kind of already shared?
Say it again.
In terms of like going maybe to more nephros or other things like that, is that already kind of built into the...
Yeah, they're already built into the commercial infrastructure. It's so small effort in doing that. I think what we have established now is 90% of our entire commercial infrastructure. 90% is already established. We are missing 10%, and this is the countries where we are not full commercial, meaning that we are not fully reimbursed. We still are waiting for what we call the last states, and that's basically taking the last part of the sales force. 90% of all commercial expenses are already being established.
Got it.
Within country, and we're in more than 30 countries now. As Jan said, any expansion is likely due to additional countries.
Got it. Cool. Gentlemen, we'll leave it there. Thank you so much. Appreciate it. Thanks for joining us, everybody.
Thanks a lot.