Ascendis Pharma A/S (ASND) Earnings Call Transcript & Summary

Good day, and welcome to the Ascendis Pharma update call. [Operator Instructions] As a reminder, this call may be recorded. I would now like to turn the call over to Tim Lee, Senior Director, Investor Relations at Ascendis Pharma. You may begin.

Thank you, operator, and thank you, everyone, for joining our conference call this morning. I am Tim Lee, Senior Director, Investor Relations. Joining me on the call today is Jan Mikkelsen, President and Chief Executive Officer. Before we begin, I would like to remind you that this conference call will contain forward-looking statements that are intended to be covered under the safe harbor provided by the Private Securities Litigation Reform Act. Words such as believes, anticipates, plans, expects, indicates, will, intends, potential, suggest, assuming, designed and similar expressions are intended to identify forward-looking statements. Examples of such statements may include, but are not limited to, statements relating to: one, our plan to seek, to address the deficiencies identified by the Food and Drug Administration; two, the timing and results of our FDA decision on the new drug application for TransCon PTH; three, our intent to continue to make TransCon PTH available to patients participating in our ongoing clinical trials and work with physicians and patients to provide TransCon PTH to eligible patients through our expanded access program; four, our expectations regarding patient enrollment in a German-expanded access program; five, timing and results of a European Commission decision on the marketing authorization application for TransCon PTH; and six, the timing of potential commercial launch of TransCon PTH in Europe. These statements are based on information that is available to us today. Actual results and events could differ materially from those in the forward-looking statements, and we may not be able to achieve our goals, carry out our plans or intentions or expectations or projections disclosed in our forward-looking statements, and you should not place undue reliance on these statements. We assume no obligation to update these statements as circumstances change, except as required by law. For additional information concerning the factors that could cause actual results to differ materially, please see our forward-looking statements section in today's press release and the Risk Factors section of our most recent annual report on Form 20-F filed with the SEC, the Securities and Exchange Commission, on February 16, 2023. On today's call, we'll provide an update on the regulatory reviews for TransCon PTH following some prepared remarks, we'll then open up the call for questions. With that, let me turn it over to Jan.

Thank you, Tim. And good morning, everyone. Last week, we received updates from regulatory authorities in both the U.S. and Europe. In the U.S., FDA notified Ascendis that as part of their ongoing review, they have identified deficiencies in our NDA for TransCon PTH in hypoparathyroidism. That, at this time, excuse them from holding further discussion with us about labeling and post-marketing requirement and commitments. The FDA also stated that this does not reflect the final regulatory decision on our NDA. The letter was brief and deficiencies were not disclosed. We are eager to learn, understand and address the deficiencies identified by the FDA. This development, [ a month ] from the agency's PDUFA date may lead to a delay in the FDA final regulatory decision on the TransCon PTH NDA. As always, the safety of patients remains our highest priority. And since our NDA submission, no new safety signals have been observed to date in our ongoing TransCon PTH Phase II and Phase III clinical trials, or in our ERP program, and these programs continue unchanged. In addition to making TransCon PTH available to the 145 patients, who continue in our ongoing open-label extension, we will continue to work with the associations to make TransCon PTH available to new patients through our U.S. expanded access program, which remain open for enrollment for the eligible adult patient previously treated with short-acting PTH. In Europe, regulatory review continues as planned. On Friday, we received the comprehensive day 120 response from the European Medicines Agency. We remain on track for a European Commission decision on our marketing authorization application for TransCon PTH during the fourth quarter of 2023. If approved, we expect our first European country launch in early 2024. In Europe, we also committed to address this unmet medical need as fast as possible, including through our early [ access book ] program. This quarter, we expect to imitate and enroll the first patient in a German-expanded access program and look forward to make such access available as well in Germany. Although there is not any additional information we can share with you at this time, we are happy to open the line for questions. But before doing so, however, just let me say, in our clinical work with TransCon PTH, patients, their caregivers, and physicians had shared with us improvements in disease control and in patients' well-being that have participated in the TransCon PTH clinical [ study ]. We believe TransCon PTH is a product that really are addressing the disease that is the hypoparathyroidism. We fill a huge responsibility toward the hypoparathyroidism community to bring forward this potential new treatment option as quickly as possible, and then ready to work in a collaborative manner with FDA so that happen as soon as possible. Operator, we are now ready for questions.

[Operator Instructions] Our first question comes from Jessica Fye with JPMorgan.

So given that the deficiency or deficiencies were not outlined in the letter and I guess, recognizing the message you're sending on this call and with the press release that with the EAP open and extensions open, it would appear to not be a safety issue that the FDA said has. What can you say about how long do you think this might take to resolve? And then I have a follow-up.

First, thanks for the question and we agree with your conclusion. Going back to the question about how long time it will take? It will be dependent on us first to understand the nature of this deficiency. As soon as we have that, it can be something we potentially can address extremely fast, or it will potentially take longer time. But I believe in the benefit and the safety we have seen until now in the treatment of patients with hypoparathyroidism and TransCon PTH.

Okay. And then just -- I'm sure people are wondering, has anything changed in the tone of the regulatory review or the topic of the FDA's questions they were focused on over the past couple of weeks?

We actually are now just trying to remind -- have received any interaction with FDA since our late cycle meeting, which we have from multiple weeks ago. So it's really hard for me to address this question because I really don't see a lot of interaction.

[Operator Instructions] Our next question comes from David Lebowitz with Citi.

Has the FDA -- I guess, FDA conduct their CMC inspection, had they provided any feedback on that? And -- could you comment on any specific questions that have been coming up in discussions recently with the agency?

To the NDA application, there have been inspection of both clinical site and also CMC-related site. After this inspection, the customer sought the inspector to issue and report that describe the findings on the inspection. We have not seen anything from either the clinical inspection or inspection of the CMOs that would reflect any kind of work related to the approvability of the NDA.

How many patients do you have in the EAP at this point in time?

Currently we have, as a company policy, not to disclose the number of patients in the EAP program. Just to remember, the EAP program is only addressing the hypopara patient that has been previously treated with short-acting PTH. We are enrolling patients and we continue to enroll patients and we will continue it, give them a treatment option as long as we will not be launching TransCon PTH. And we see this patient group observing the exact same benefit like what we have seen in our clinical trial.

Thank you. Our next question comes from Tazeen Ahmad with Bank of America.

Did you, Jan, already complete the late cycle review for the application? I'm just trying to understand at what point these deficiencies came up? And also, I just wanted to clarify, is it one deficiency, or are they identifying multiple deficiencies?

You're correct, we had the late cycle review meeting. Now I'm a little bit blinding on exactly the date, but I believe it's about 3, 4 weeks ago. And so that was addressing your first question. And the second question?

Just on decision, is it one deficiency? Or is there more than one deficiency that they've identified?

Yes. This question is really hard for me to, some way, to answer because we only have this very short letter that described, that have identified deficiencies. And we do not know is that related to a single or multiple?

Our next question comes from Li Watsek with Cantor Fitzgerald.

This is RoseMary on for Li. Just very quickly, do you think this issue will be specific to the FDA? And is this not going to have any impact on EU approval? Or you might hear something from them later?

We were so happy when we saw the comprehensive 120 days feedback from the European. We went to this intensive feedback because this basic are reviewing all aspects of the application. The element we are responding back to, we feel highly confident we have sufficient information, and they are not in the nature that we will restrict any kind of expected approvability of TransCon PTH in the European Union. Our expectance is still approval late this year, and we are getting ready already to launch TransCon PTH in the first European country early '24. And we said before, we are also installing an expanded asset program in Europe. We are doing -- starting on the filing, and we expect to have the first patient already enrolled here in this quarter. This program is different compared to the U.S. program because it takes both PTH experienced patients, but also new patients. So it basically is addressing the entire patient population of hypopara patients, which are much, much larger in Europe compared to U.S.

Got it. And if I could ask just a follow-up question. Where are you in the launch preparation in the U.S.? And how does this potentially impact those activities?

What we are as Ascendis Pharma, we launched SKYTROFA, and we are [ stapling ] the launching of TransCon PTH out from this established infrastructure. So -- and this is a product opportunities that's coming directly into the same therapeutic area endocrinology. It takes us to a unique position because half of the small that part of the sales force now we had dedicated to PTH, half of them are coming with TransCon PTH experienced SKYTROFA in the U.S. So we basically can take that part and take the period where we, if we get a later approval than the PDUFA date we will be utilizing this sales force and the infrastructure to really build up this SKYTROFA to a much higher level that we have already seen how it's accelerating month by month, quarter by quarter. So by utilizing that we are, from a revenue perspective, easily can compensate from the one product to the other product because we are in this unique position. We're building up pipeline in each single therapeutic area. So we both have the economy of scale opportunity to deal with this position without having anything to do with these people, we are basically utilizing them in our big effort in trying to promote it. But still, we will go out and promote TransCon PTH. We will still build the awareness of hypoparathyroidism, because that is a part of our long strategy. And because we do, to our best knowledge, our expression to get TransCon PTH up to the patient as fast as possible. This is our responsibility for the patients.

Our next question comes from Paul Choi with Goldman Sachs.

Can you comment if as part of the late cycle review, the agency asked for any additional data, even if it's minor or trivial in your opinion, or any additional analyses?

I believe in every time you have an interaction with FDA, you have a constructive dialogue. And sometime in this constructive dialogue you are presenting slide and also data. And often to every time we have a meeting with the agency, they often ask for getting access to this data packet on a data stage. So every time we have interaction with FDA, there will always be material data presentation being filed to FDA. I think this is a part of having a constructive dialogue.

Okay. And then as a follow-up, maybe relating to an earlier question. Can you comment on when you would specifically ask for either, I guess, a Type B or Type C meeting, or Type A or Type C meeting, depending on what you think is appropriate, and when you would potentially expect scheduling of that to occur? Any more precision on that?

I think we're not waiting for that. I think we will continue our constructive dialogue with FDA. And as soon as it's possible, set up a call so we can continue this dialogue and find a resolution for how to bring TransCon PTH out to the market as soon as possible. I think this is everyone's interest, everyone recognizes the unmet medical need and the benefit that TransCon PTH gives to the patients.

Our next question comes from Derek Archila with Wells Fargo.

So just one from us. I mean we've seen the agency use this type of language before with other companies in their press releases. So I just wanted to kind of get an understanding from you how you might think this situation is different from you. And ultimately, I think all those cases that we found led to a CRL. So any differences would be helpful.

My question is that -- or I really don't have the knowledge where I have a look on old company that have got a letter that describe deficiency under a priority review or not under priority review and look to what is really happening with these companies. So it's really hard for me to comment on some elements where basically not feeling confident I have done a sufficient analysis for coming with a valid answer.

That's fair. Maybe just one follow-up for me. So I think just piggybacking on the last question. So have you spoken with the agency to set up that meeting yet? Or is that still something that you have not yet done?

This is what we are doing here in the near future, initiate collaborative discussion with them and finding a way forward. And I think they will be initiated as soon as both parties are ready and have the time to do it. We will definitely be ready and have the time to do it.

Our next question comes from Joshua Schimmer with Evercore ISI.

Has there been any discussion or do you now anticipate a potential 3-month extension to the PDUFA date?

The only element we have got at feedback from FDA was the letter. And there was no indication of anything else than that short writing about that -- the deficiencies. So we have not received any further information.

And our next question comes from Leland Gershell with Oppenheimer.

Any expectation you may have on when you may have your meeting with the FDA?

I think we will -- as I said before, we are trying to plan for a call as soon as possible to initiate the dialogue and getting a constructive outcome, so we can bring TransCon PTH out to the patients and get the expected approval as fast as possible.

And our next question comes from Andreas Argyrides with Wedbush.

I'll try to ask in a different way here. So Jan, given the proximity to the PDUFA, it leads us to believe at least that this is -- there are probably some minor deficiencies that the FDA is not necessarily coming out and wanting to state, that they want to extend the PDUFA, though that may be the case. To what extent, given the timing and the fact that there's prior review, do you get the sense that these are readily addressable. Maybe you can just kind of comment there, I appreciate it.

Yes. I think there's multiple questions in your question. First of all, we cannot really speculate of the nature of the deficiencies because we don't know it. The second question is that when we're also integrating the feedback we have received from EMEA, I have to believe that is a product opportunity that have all [ prospect ] from whether it should be approved as a pharmaceutical product. And, we have, for many years, observed the huge benefit this product opportunity has given to the patient, the physician and caregivers. We have listened to the patients about the unmet medical need. We just need to find the pathway to get this product out in collaboration with FDA here in the U.S. I'm thrilled that we still can help patients in our EAP program. Said enough, it is only the patient that have the PTH experience here in the U.S. that can through a physician sign up for this program. But at least, I feel we are helping the patient in this way. And when I look at our values about the patients and the science, you could be dedicated that we will try to get this product as fast as possible also in the U.S. I see a clear pathway to have this product out in Europe in the beginning of next year. Also would like to see the clear pathway to get it into the U.S. market because the hypopara patients in the U.S. need it.

Okay, great. And a quick follow-up here. Do you think -- or do you have any knowledge as to whether what's going on with the FDA whether maybe they are experiencing delays in reviewing and this may be part of a delay on their end as opposed to anything specific again back with the filing?

I really don't believe I can really speculate or address any element from how FDA has functioned and how they're responding. But what I observed, we also observed a small delay for SKYTROFA. It's always a little bit more burdensome for every agencies to deal with a product opportunity that is a combination product because it's not what we call a simple filing because it typically involves much more elements in the regulatory approvability in it because it's a combination product.

Our next question comes from Joseph Schwartz with SVB Securities.

So we see 2 examples recently where this occurred and led to CRLs, but also 2 examples where it led to approval nonetheless. And so in one of those examples for the CRL, one of the reasons for the deficiencies was attributed to human factor study. So I was wondering if you could talk about what you've done there, and if you think that your work is sufficient? And then one of the examples where it led to approval was related to a bone mineral density study. So I was wondering if you could comment on how you feel you're positioned on that one?

Thanks for the question. It's really hard for me to comment on this question because I have -- can only speculate, and I have no knowledge of what really there is in the deficiencies. So for me, it's really impossible to answer the question. I can answer partly, for example, building up in Europe, the devices actually being approved on an independent agency or independent pathway than the main one. And we already basically got the approvability on the device, which includes the factor studies. So some way, we have got regulatory feedback to that part. About the element you are asking about is that all elements we are seeing, both related to bone marrows and bone density changes where we're normalizing the normal development of bone health, it has never been a part where there have been raised any safety concern to it. Also from that aspect, we are continuing also here in the U.S. to enroll new patients in our EAP program.

And our next question comes from Yaron Werber with Cowen.

This is Joyce on for Yaron. I guess that just depending on what might be the reason for the delay, assuming that you refile, would it then be sort of a 6-month review process or more traditional 10-month review process or a 3-month extension? Just thinking -- I was just wondering how you're thinking about the time line for that.

I think we'll start to think about that as soon we understand the nature of the deficiencies. Then we can start to think about how we, in collaboration with FDA, can work together, resolve it and potentially if it's needed, refile it.

Great. And then maybe just one quick, quick follow-up. What could this maybe mean for your cash guidance?

Currently, we are always running Ascendis out from a perspective that we have been at very fortunate position to have a large cash holding. And what we are doing now, we are in a position that we continue to accelerate the revenue generation from SKYTROFA here in the U.S., and we will start to accelerate the SKYTROFA revenue generation in Europe later this year. So we are in a position where we basically are coming to what we really believe is our goal to be a sustainable, profitable leading biopharma company. If I see a potential small delay on launching on TransCon PTH in the U.S., it's not changing the big picture. We are on track to what we want to be. That is not changing the perspective for us. Because we have synergy in our sales force, we will continue utilizing our commercial infrastructure to build up the awareness of hypopara in the U.S. But at the same time, we can also enforce it as a signal, the effort we do want to control. This is the idea by having multiple products in one single therapeutic area. This is not our first product to get approved. We have products in the market that already give us that more than the expected room.

Our next question comes from Caroline Palomeque with Berenberg.

Just wanted to ask about manufacturing process for TransCon PTH, and just how confident are you in its scalability?

The great thing by TransCon PTH is that it builds on a product that has basically been established for more than 20 years,[ FORTEO ]. [indiscernible] that is the crucial producer of our drug -- often is basically utilizing the DMF from FORTEO and this is where we're getting [indiscernible]. Rest of the supply chains are built on [ Fera ] which makes the drug product, [ a vial ], which I believe is one of the best recognized drug product producer. And the pen injector is built on [indiscernible] pen which I have to believe is getting utilized a million of times a day, this is basically an insulin device. So when I look on the supply chain, to my knowledge, it actually is what I call a supply chain that is built on established proven products in established proven CMOs that have the quality to really deliver on a global basis to all countries, including U.S.

And our next question comes from [ Seshila ] Hernandez with [indiscernible].

Were there certain topics during your label discussions that were controversial?

So the question was -- just, could you repeat the question, sorry?

Were there certain topics during your labeling discussions that were controversial?

I don't think we have any kind of controversial discussion with FDA during our label discussion. We were following the normal procedure, that we are sending in a proposal to the label. And we got the feedback from FDA, which we actually think was really reasonable. It didn't include any element related to black box [indiscernible] program or other things like that. And then we have responded back again, and we -- this is the correspondence we have related to our daily discussion.

And our last question is a follow-up from Tazeen Ahmad with Bank of America.

Again, I just wanted to clarify, did you receive any 483s as a result of your pre-approval inspections?

No. We both have been inspected from different clinical sites, and we've also been inspected in our SIMs of supply chain, as I recall.

We have a follow-up question from Leland Gershell with Oppenheimer.

As we sort of try to tease apart what we can hear based on the limited info, again can we at least delineate this being a [indiscernible] review initially with the content of the NDA versus what maybe a technical issue with the filing, given that you didn't get an RTF, presumably your NDA itself is intact, but would there be any reason to believe that perhaps there's a missing section or a module of the NDA that could be addressed in relatively short order?

I think you're not missing anything. But the question is that I cannot answer your question in any kind of valid manner before I really have got the direct feedback from FDA, what is basically the nature of these deficiencies. We believe we will have this constructive dialogue as fast as possible. And we still continue here in the U.S. with our EAP program. So I have to think we are on a good way forward.

There are no further questions. This does conclude the program, and you may now disconnect. Everyone, have a great day.