Okay, let's go ahead and get started. This is the fireside chat with Ascendis Pharma. Thank you for joining us. Before we get started, I need to read a brief disclosure statement. For important disclosures, please see the Morgan Stanley Research Disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative, and I'll turn it over to Tim Lee from Ascendis Pharma to read disclosures from their standpoint.
Thank you. We may make forward-looking comments during this presentation. Actual results may differ materially from those expressed or implied, and you should not place undue reliance on these statements. For information concerning the factors that can cause actual results to differ materially, please see the Risk Factors section of our most recent annual report on Form 20-F. Now, before I turn it back over to Vikram, I want to make a comment regarding our U.S. regulatory status on TransCon™ PTH . Jan provided a status update during our second quarter call last week, and we are not in a position to make additional comments beyond that. Vikram, back to you.
Sure. Happy to have with me Jan and Scott from Ascendis. Thanks for joining us. Appreciate it.
Thank you. Thanks a lot for inviting us.
Of course. So, quite a lot to cover in roughly 30 minutes. Before I go into any specific pipeline programs, do you both want to just take a minute and just go over what you think have been some of the key inflection points for the business throughout the year, just to kind of set the stage for everyone in the audience?
I think we did that in our Q2 release. We set the stage that, I, in January 2019, came up with our vision three by three, how we want to be a sustainable leading biopharma company. Later on, the word profitability came into the statement. We built that into it. The cornerstone was that was to get three independent products approved in our rare disease endocrinology pipeline. We achieved that with, Skytrofa in 2021, and I'm sure we will talk a little bit more about Skytrofa later on, how we want to develop that to a blockbuster. We got and hope to expect to get PTH approved in 2023, and we lay out our pathway for our TransCon CNP, a treatment for achondroplasia, really addressing the comorbidities. We laid that out. We will expect to get approval in 2025.
So what we're doing is, is fulfilling our vision, how to build a sustainable leading biopharma company. All our product opportunities is built on our TransCon technology platform. Because we are a platform company, we also have applied the TransCon technology outside our rare disease endocrinology, and we have program now in oncology through product opportunities, where we both have achieved candidate phase II, both as single agent but also in combination with checkpoint inhibitors. We're now in what I call the final stage, the late stage, where we will get data in 2024 from seven independent indication, where we go into cohort, much more homogeneous, really can see the effect on it. We can potentially talk more later on that.
We also applied the TransCon technology in ophthalmology, and what we're doing, we are basically trying to see how we can create value, help patients with the TransCon technology also in areas outside rare disease endocrinology. But, to be, our focus has always been on rare disease endocrinology. This is where we started the company. This is where we really can take from idea states to clinical development, out to the patient now, when we're building out the global commercial infrastructure to really get it out to the patients.
Great.
Scott, do you have anything?
I think that's it.
Great. Okay. So fully understood that you're not in a position to be able to comment on regulatory discussions with TransCon™ PTH , but could you just, to level set for the audience, I'm sure most people are familiar, but just in case, just remind us kind of what the central issue was that led to the concern from the agency, and where are you right now as of your 2Q-2023 update? And then we can go from there.
Yeah. What I can do, and I think, Tim came with some statement in the beginning, and, I'd say the statement said a lot about where we are in the regulatory interaction with FDA. I can give you the background-
Sure.
T hat we disclosed at our CRL. We got the CRL, reflecting to the ability in delivered dose, and you can say, what is that really mean? That is meaning when you have two control strategies, typical in delivered dose, one is drug content, or another one is dose accuracy. Drug content is mainly the, you can say, the content of your active drug in different batches. Dose accuracy is basically the pen device. In our case, how well are you precise delivering a dose? And then you can say the highest dose in drug content, multiplied with the highest dose volume, give some concentration of the delivered dose.
If you take the lowest drug content, the lowest dose volume, and then you have the lowest, and then there can be a theoretical risk that you can see the ability when you go from one batch to the other batch. That is basically the control strategy that was discussed in our CRL. There has never been raised any issue related to our efficacy and the safety that has been seen in our clinical trial. This is why we still have EAP programs that it's running in Europe, enrolling in US. When you go back and look on their concern, what can this dose variability raise as a concern? It could be an incident of hypo or hypocalcemic episode.
Today, when we look on all the patient data, we basically are in a position that we're really providing and such treatment to the patient with hypoparathyroidism, that we basically are taking the incidence of hypo, and hypocalcemic episodes down to an extremely low level. So when we take the holistic view, is why we have not seen any concern in Europe or anything like that. We have not raised this issue in Europe, because we have taken from the holistic perspective, is that you basically eliminate a huge issue for this patient. If you get a little bit back again in hypo- and hypercalcemic, it's acceptable because that's the only way we can titrate the patient, the 15%-20% of the patient that really need a tight titration on it.
At the same time, we're providing so many other benefit to the patient, not only normalization of phosphate level or anything like that, also kidney function. And perhaps why people really are so adherent to the therapy, the quality of life they're getting out for it. They're feeling normal again. They're feeling they can fulfill a day-to-day function, which they couldn't do on an untreated by not having the normal physiological level of PTH. So we will do everything we can do in the health with the patient organization, really also get this product out to the US patients, because they really deserve to get it.
Okay, understood. And, I'll ask you one final promise question on TransCon PTH in the US. I'm not sure if you're in a position or if you want to answer this, but, in terms of public disclosures, is the planned October submission, is that likely to be the next public disclosure, or could there be some interim updates between now and then based on how interactions go with the agency?
This is not a question to me, this is to Scott.
To Scott?
Yeah, I would expect we would update when we resubmit the NDA.
Okay. Got it. All right. Maybe we can then talk about TransCon™ PTH in Europe for a little bit, because you have a decision expected there in the near future. Just talk to us about some of the pre-launch activities that you have underway there. What are you doing to educate the market, build out your commercial infrastructure?
Just for explaining the potential European approval process. In Europe, you first start with a positive opinion. That is the first step, and then you turn the positive opinion into an approval later. It takes about 50, 60, 70 days. When you get a positive opinion, at least in my cases, I never see it not being turned into a final approval, but it's basically is a two steps. So basic to achieve the positive opinion is the key element in any approval process in Europe. We are in the late stages, and we expect to get a positive opinion in the near future. The first country you will launch in will be typical Germany, because you have what we call fast reimbursement. The patient population with hypoparathyroidism in Germany is about 15,000 with a diagnosis of the disease.
We are in a position, we believe, based on different surveys, that they believe that potentially there is the 15,000 further patients that not diagnosed with the disease. We have initiated an EAP program in Germany, which are different compared to the US EAP program, because it's open both from a new patient, but also for PTH-experienced patients. Currently, we are enrolling patients in this program, and as soon as you're getting the approval, such a program will automatically be stopped, and then these patients will be turned into reimbursed patients. We have, for example, disclosed CKD data or data that defined how TransCon™ PTH has had a positive benefit on kidney function. We did that analysis mainly from the backup of the AMNOG documentation.
AMNOG documentation is basically the huge document you send into the German authorities related to your price discussion. This documentation is important to show also the long-term benefit of our product. We were really, really thrilled to see that a product like TransCon™ PTH basically could take 50 of, 50% of the patient that have an diagnosis of renal impairment and make them to have normal kidney function. We were really impressed to see that, and that is part of the, to see how we really are coming with a justification of our price structure in Germany as the first country.
We will then enroll over in other European countries, and we're also building up our international operation that will take rest of the world as to be sure where there is hypoparathyroid patients, we would like to be, we would like to be in a position we really can give them the benefit of this treatment everywhere.
Understood.
But what is perhaps more important, the first launch would not be TransCon™ PTH . It will basically be SKYTROFA. We have seen the success of SKYTROFA being launched in the U.S. we have seen how we're providing a benefit to the patients. We have seen how we penetrating the market, really building on the product strengths, and we want to do the same thing in Germany. So in the next week, we're actually launching SKYTROFA in Germany, and we will do the same rollout, first in other European countries, but also in international operation of our SKYTROFA. So this is the two products are what, you could say, the longest, we're starting with in Germany.
There's been some focus on how, excuse me, ex-U.S. SKYTROFA launch dynamics could compare or contrast versus the US launch dynamic that you saw a couple of quarters ago. What would your guidance be on how to think about the differences in the two markets and some of the nuances we should keep in mind when we compare the two launch trajectories?
My basic thinking, my basic understanding is that pediatric growth hormone deficiency is the same as in the U.S., as in Europe and other places. Our product is performing in the same manner, independent of ethnic background. The competitive landscape is the same. So my assumption will be that you will see on a high level, the same market dynamic really play out as you saw in the U.S. And I believe I'm proud about SKYTROFA today. I'm proud about SKYTROFA coming out as the fulfilling the commercial goals we had for the launching in the U.S. We wanted to have SKYTROFA to be the leading brand in value, but we didn't want to jeopardize the overall growth hormone market. We wanted to do it in the same manner where we built SKYTROFA to the leading brand in value, but also grow the entire growth hormone market.
We believe that is justified because we providing a much better treatment outcome compared to the daily treatment, and therefore, we believe that it really is responsible to have a premium pricing for treatment.
Understood. One topic on SKYTROFA outside of pediatric, so you have an adult GHD data set coming in the fourth quarter. Just help us think about what we can learn there, and broadly speaking, how large of a commercial opportunity do you think adult GHD is for SKYTROFA?
Yeah. We don't make SKYTROFA the leading global brand in value without investment. The key investment we already have done now was also disclosed in our Q2. We basically have built up global supply. We went up to large-scale manufacturing at Lundbeck, huge investment of more than EUR 100 million, just to take it up to large scale. It provided us two important elements in our global strategy: global supply of drug substance, but at the same time, also much better improved costs. We want to be profitable as a company, and you do it by investing in generating profit on each single of your products. We will also invest in other things. We're investing in label expansion, and the first one that will come is adult growth hormone deficiency.
It's a key label expansion for us because it, first of all, you address another key primary endpoint than you do in many of the pediatric indication, which are linear growth. Here you go out on body composition, a key parameter also for the pediatric segment, but we have that as a primary endpoint in our trial. The trial, just to recall, is three-arm studies, randomized 1:1. One, placebo, one is going to be SKYTROFA, and the other one is daily growth hormone. Because we want to show that we are at least as good as daily growth hormone, because that is what the patient deserves. They need to have a much better treatment that at least get the same outcome that you see with daily growth hormone. That's why we made it as a three-arm study.
From a regulatory perspective, we just needed to be better than placebo, but we wanted to be quite sure we also are in a position that we can get the benefit, at least what you see with daily growth hormone. It's highly under-penetrated segment, and, when we look on the penetration, we believe there is room really to grow the adult segment to a much larger population today. To our best estimate today in the U.S. market, is 10% is adult growth hormone deficiency, and we believe because of the penetration, less than 10%, that it's possible to grow that to a much larger segment. Scott, any key KPIs or any fundamentals you want to add?
I agree with all that. I think, regarding the market size in general, I think Jen has mentioned our objective to grow the overall market and be the value leader. And you saw that with pediatric GHD, where we are the market leader for all growth hormones in the U.S. for Q2, with less than 10% of pediatric, which itself is less than half or about half of the existing market. And then you layer on, you know, what Jen is saying about being able to grow the adult to a much larger population. We see SKYTROFA as a blockbuster product for sure.
Got it. Okay. Let me take a pause and see if there's any questions from the audience on either PTH or SKYTROFA. Not yet. All right. Let's pivot to CNP then. I want to be able to touch on all, all of the components of the pipeline here before we close out. Admittedly, a tough question to answer without having your data in hand from your, from your pivotal study. But if the study works out according to your internal expectations, if it succeeds, where do you see TransCon CNP fitting in versus the other injectable therapy that's already approved and out there, and other competitive approaches that are being developed? Where do you hope for it to sit within the entire achondroplasia treatment paradigm?
So our vision, our target product profile, is building on one single element, providing a treatment to achondroplasia. And now we just talk about the achondroplasia, because we believe TransCon CNP, together with our SKYTROFA, our once-weekly growth hormone product, is the cornerstone in our future strategy to be the leading company in growth disorder, because we control both the most important pathway in every growth disorder. But going back to our vision on achondroplasia, we want to provide a treatment, meaning is that we want to address the comorbidity. Addressing the comorbidity is more important for us than actually addressing linear growth. And this is why when we look on our II-B and phase III trial, we just had regulatory interaction, both in U.S., we had regulatory interaction in Europe.
We got the traditional way to measure linear growth, analyze height velocity over one year as the primary endpoint, because that is established now as a primary endpoint. But the key element for us is to look on secondary endpoint, where we are in continued dialogue with regulatory agents, both in Europe and U.S. How really to integrate and ensure that we can get the full treatment benefit of this. And, you know, we started for three years ago, our phase II study. We are the only company that made a phase II study over 1 year with placebo controls and multi-ascending doses. We did it because we did risk thing on phase II stakes. So basic, our phase III is a copy of what we did in phase II. We started with 53 patients, and now, three years after, we still have the same number of patients.
We were puzzled with the impact we saw on this patient's life, the caregivers' feedback, the physician's feedback, because we realized that the son came back and saying, after one to two months, we see major improvements. We asked, that cannot really happen by linear growth. You cannot change linear growth in just one to two months. That was why we really went back and made a huge review of the literature, and really found out that achondroplasia is also a muscle weakness disease. Because what we realized, they're saying it, suddenly, the child can take on a bike tour. Then you saw biking, yes, it's natural for most children to do biking, but it was not natural for them. And this is because the lack of coordination, the muscle and everything like that.
And this was how we really found out how we basically, with a continuous exposure of CNP, basically can address some of this integrated holistic view of how to treat Achondroplasia. The other thing we got somewhere aligned in our regulatory interaction was the 100 microgram per kilo per week. We also got aligned the duration of the trial, one year, the number of patients, and we enrolled all the patients in four and a half months. How many trials have been enrolling as a phase III in four and a half months? We went to 90% of the sites that basically had experience with TransCon CNP. We went to 8V0% of the sites that have access to other treatment in Achondroplasia, but still, after four and a half months, all the patients were in.
The other part, we built all this, an integrated treatment regimen, and one of the two other trials we are initiating now, one we just filed for IND, is our newborn study. We're going to a newborn study because we believe if you need to address some element like spinal stenosis, you need to treat them from newborn, because after two years, it's irreversible. So some of these comorbidities, you need to start as early as possible. That's why we initiate a newborn study. At the same time, we're also initiating a combination study. If you believe you prefer just to have linear growth, but also at the same time addressing comorbidity, but want to have more linear growth, we therefore be running a combination trial with SKYTROFA.
Taking achondroplasia, both naive patients take them both on CNP and SKYTROFA at once, or we take some of the CNP patients that already are on treatment and then adding in SKYTROFA. We will also run that trial next year. This is how we build up the holistic thinking about how we need to treat optimal achondroplasia, but it only can happen because we have the two cornerstone products. We know from pediatric growth hormone deficiency, it's really difficult to have a daily treatment in any pediatric segment. It's why we made CNP upfront to be once-weekly dosing. But we mainly did it upfront because we could provide continuous exposure of CNP to address both the growth disorder part, but also the muscle weakness part of it.
We will have a research day later this year, where we'll come back and give you all the scientific explanation, the scientific review of all this, and give you more data from our patients where everyone stays on now, everyone has been for at least one year on the highest dose, and we will give you some of the data from that data call.
Got it. Okay, great. In the roughly five minutes we have, maybe we can just touch on some of the earlier stage pipeline programs. I wanted to revisit TransCon RBZ. You had announced an ophthalmology program, I think, in January of this year. Just wanted to check in to see how that program is going, when we can expect to learn more on that new vertical that you're building out?
Yeah. For us, it was basic to utilizing the TransCon technology in areas where we believe there is a huge unmet medical need, and we can use the same algorithm for product innovation that have been extremely successful in rare disease endocrinology. Think about we started with three rare disease endocrinology pipeline in preclinical, and we managed, basic, hopeful to get all three approved in less than 25. We did the same thing with our ophthalmology. We use the same TransCon technology with a different carrier. We taking basic Lucentis, which are the same as ranibizumab . We're also taking one in the complement system and building up a pipeline. We also believe that we will not be an ophthalmology company. We still can use a huge benefit to the patient through the TransCon technology.
So ophthalmology is one of the element that we will divest away from Ascendis Pharma, because we will focus on really, really to be in position, that we will focus on our rare diseases, specific endocrinology, and this is where we really will focus our resources. Because we have the capability really to take product from the idea stage up to the patient, basically, on a global scale.
Got it. Got it. Okay. You'd also mentioned with your 2Q update, a new carrier technology, and you'd showed some preclinical data with the GLP-1 analog. I had two questions for you there. One, I know the GLP-1 analog work you mentioned during your earnings commentary that decisions are still being made, the pipeline there is still kind of being worked out. You'll have more updates for us in the future, but what are some of the scenarios that could result there? What's the type of work you could do there with GLP-1 analog? And then more broadly, what types of product candidates could this new carrier be used for beyond just GLP-1, based on what you've seen so far in your early stage evaluation of it?
Yeah. So what was the reason for us to invest two years in expanding the TransCon technology? The reason for doing that, we came from the rare disease perspective. Meaning is that often you have to not what we call huge, huge, huge volume to low, low cost you have in many of the primary care segment, like diabetes, obesity, and other things. But we have seen the huge benefit of the TransCon technology, and therefore, we wanted to take the TransCon technology and then add two important things to all the benefit of TransCon technology, but have it in such a way that is really tailor-made to high-scale manufacturability, as you do in obesity, diabetes product, and other things like that. The other things we wanted to add in, it cannot have a major impact on costs, on manufacturing cost.
That was why we built up a new TransCon technology platform to accommodate these three elements. Keep the benefit of the TransCon technology, keep the benefit of having large-scale manufacturability, keep it not expensive for the product. Then we wanted to find a product where we want to show it, which are well known for a lot of people, where there's a lot of basic knowledge about it, and then we took semaglutide. We took semaglutide out from this idea that we know that if we can improve the GLP-1 to basic, to a dosing profile, that providing the same peak to trough that you see in a weekly with a monthly, perhaps you can address the unmet medical need, that 50% of the patient drop out in one year after first year treatment, because you can make potentially better tolerability for the patient.
Instead of having the side effect every week, you can have one month's injection. The other way it could be positioned basic will be in when you want to initiate the treatment or want to have a high-dose treatment, you can take it on a weekly basis, and you will basically have a flat, continuous infusion. Because we know when you go from the trough to the peak, you often get the tolerability issue, and you will just have a flat curve every week for the time. And that is why we accepted with semaglutide, you can use whatever GLP-1 you want to use there.
We can use it in cardiovascular diseases, we can use it other places, but it give us in a way where we as a platform technology really open up for some of the segment we could not really address with the already established two platform technologies of TransCon technology.
Okay, great. With that, we're actually at time, so let's go ahead and close out. Jan, Scott, thank you so much for joining us.
Thanks so much for having us.
Of course. Thank you.