BioMarin Pharmaceutical Inc. (BMRN) Earnings Call Transcript & Summary

Okay. Great. Hey, good morning, everyone. My name is Olivia Brayer. I'm one of the senior biotech analysts here at Cantor Fitzgerald. Thank you so much for being up early with us this morning to kick off our conference. And we are really excited to start the day with someone special from BioMarin, Chief R&D Officer. We have Greg Friberg. Greg, thanks so much for making the trip out here to the East Coast.

Thank you for the invite. It's great to be here.

A lot going on at BioMarin these days. So maybe just to kind of set the stage, give us a sense of top priorities heading into 2026. Again, there's a lot of R&D going on these days. So maybe just set the priority list, right, in terms of what matters most to the company. And then as you think about shots on goal, where do you feel like you guys have the best chance of success with your current R&D engine, so to speak?

Well, thanks for the opportunity to share what I think is some pretty exciting progress in our pipeline. When I think of, again, our priorities, certainly, our BMN 333 program, our long-acting CNP for achondroplasia is one that I want to make sure that we talk about. That being said, we're actually turning over some cards when it comes to the pipeline over the course of the next year as well. Really excited to see the hypochondroplasia data for VOXZOGO in the first half of next year. Similarly, we're filing both in the U.S. and Europe, our data in adolescents for PALYNZIQ, a big opportunity to expand the label there and again, give patients something that we think is of real value to them. And last but not least, in terms of near-term news, we'll be turning over a card with regard to BMN 401, which was acquired from Inozyme. This is a first-in-class, first-in-disease therapy for ENPP1 deficiency. And the first study, the so-called ENERGY 3 study will be turning over its card also in the first half of next year. When you think about the internal pipeline activities, I would be remiss also not to point out that we have a lot of enthusiasm in the business development space going on right now. We're in a fortunate position where we have cash and we're looking for opportunities, not just for early assets, but also for late-stage assets to be able to replenish the pipeline there. And again, we feel that the financial environment that we're currently in, puts us in a good position given that we have those resources, and we're certainly preparing for those opportunities as well.

Yes. And maybe just to start with BD, because you mentioned it. How do you guys think about the business development strategy? I mean, you did do a deal this year. Is it one deal a year? Is it really not that frequent? Is it not really about the quantity, but it's about the quality of the assets? And then, I assume rare diseases has obviously been the company's wheelhouse. So are there certain indications or certain areas of rare disease that maybe you guys are more interested in exploring when it comes to BD?

So it's more of the latter strategy, looking for quality opportunities. Yes, we want to pick our shots, but we also want to be opportunistic in the current environment. I would add that there is no quota in terms of number of deals that would be done. The Inozyme deal was one we're incredibly proud of. The work that Inozyme has done is great to get that molecule to where it was. And we think, of course, as BioMarin that we can add significant value bringing that forward. That being said, it was on the small side. We do have the opportunity and the firepower to look for larger opportunities as well. And they fall into a variety of bins. One would be the areas that we think we have strength already, certainly in the skeletal conditions as well as enzyme replacement therapies, which is a big bucket. But those are two areas that we're always on the lookout, making sure there are opportunities. There are adjacent opportunities as well in other indications in neuromuscular and pediatric neurologic indications, benign hematology, where we're continuing to look. But that being said, the strategy is really one to look for genetically defined conditions. What that means to us, of course, is germline genetics, opportunities to use our strength, not just in terms of our financial strength, but in terms of our technical strengths. We have a footprint and foot boots on the ground in 70 countries around the world, reaching patients with so-called rare diseases, but again, genetically defined conditions. We think that our ability to locate, find and then ultimately treat those patients is something that gives us an engine that if we plug in additional molecules, we can really capture the value of those and do so at a speed that perhaps other organizations would struggle. We've been doing this for decades. And again, we want to bring these sorts of therapies to the world.

Yes. And you led earlier with BMN333. So maybe we'll start there. Maybe just talk about -- and this is the long-acting CNP candidate that BioMarin is developing. What makes this asset different or unique or special? And then maybe just remind us where that program sits today? I know, you had some early -- or you had some initial healthy volunteer data. Can you talk about some of the highlights from that data set or at least what you've disclosed so far? And then what's next for that program?

So the CNP ecosystem is one that the biology is rapidly evolving. Native CNP, it's 22 amino acids. It's got a half-life measured on the order of minutes. VOXZOGO was created vosoritide, it's CNP-39, engineered to have a half-life on the order of an hour, again, given subcutaneous and daily, and we've seen certainly that this is both a safe and effective drug in Asia, helping a lot of patients right now, continuing to work to see whether or not VOXZOGO can help patients with additional short stature conditions. And so that work is ongoing. We're also thinking of the CNP biology as giving us an opportunity to develop franchises. And so, we've engineered a molecule in BMN333 that offers an even longer half-life and a PK profile that will allow us to get more CNP on board. There's a nuance here, which is that when you have a short half-life molecule, you're often limited in the amount that you can give patients by what's called the Cmax. And there's a very well-known side effect with blood pressure drops. It's not life-threatening, but it's measurable with tachycardia, particularly in adults that one can see when you get up to high Cmaxes. A longer half-life will allow you to avoid those Cmaxes and yet increase rather than a sawtooth pattern, increase in a broad stroke, the AUCs that one can see. We've taken the CNP that we described, CNP-39, and we've attached it to an albumin binding peptide similar to other molecules that are out there. And that is BMN 333. Think of it as like a depot form of CNP, where slowly CNP is released in the blood stream. We're running a Phase I study right now, and we've announced that in these healthy volunteers, single dose study that we've been able to see not just equal, but we've seen in multiple cohorts, 3x the AUC that other long-acting CNPs have been able to achieve. Why 3x? Well, in the animal models that we've seen 3x appears to provide a meaningful increase in linear growth as compared to 1x with a simulated long-acting CNP as well. So the study has got 6 cohorts. We've completed all 6. As we mentioned in the earnings call recently, when we reached Cohort 4 and 5, they had already reached our 3x threshold. Cohort 6, we haven't announced yet, but we just completed it. And so from that standpoint, this molecule will really exceeded our expectations with regard to the PK profile. We believe that we have the right reagent in hand to test the question of whether higher exposures will deliver higher growth. That's a hypothesis supported by a couple of different sets of data. One would be the animal models that I mentioned. Another would be human genetics, where if you have activations in these pathways, those patients get quite tall. And interestingly, it appears that the only side effect they have when those very high CNP levels are skeletal related. So no off-target, no off-skeletal toxicities which is reassuring. And finally, these levels of AUC have not been tested in humans before, but there does appear even with the other long-acting CNP agents to be a linear relationship between dose and growth. The question is, does that curve continue upwards? We think it's a good bet, and we think we have the right reagent to test that in BMN 333.

Yes. And maybe just contextualize that 3x AUC. I mean, I imagine 3x AUC isn't necessarily equal to 3x growth, right? It's not a linear relationship. But what are you all expecting to see in terms of the impact on growth? I mean, maybe not necessarily a number that I'm asking for, right? But as you think about the relationship between growth and AUC? And then, maybe as a follow-up to that, and I'm sure you'll get to it on your own. But why AUC, right? Why is that a more important metric at this point than Cmax?

Yes. Very fair questions. So with regard to the amount of growth we're looking for, I can say that in the rodent models, the 3x AUC plus doubles the amount of attributable growth in the model that one sees as compared to a healthy dose of VOXZOGO or a similar dose of the 1x long-acting. Will we see that in humans? To be determined. But what I would say is that, we've talked to physicians and patients and we're designing studies that would have a meaningful increase over what's been seen with VOXZOGO previously. With regard to the targets, I would add that, the animal models tell us that increasing levels of AUC do appear to have a linear relationship with the amount of growth that can be delivered. One of the reasons we can't do the same thing with Cmax, we can't run the same experiment as you run into the Cmax related toxicities. It's similar to the analogy, my pre-clinical colleagues remind me of running a race. If you got to run a mile, are you going to sprint the first 100 meters and then -- and jog it in the rest? Or are you going to have a nice brisk run for the entire period? Different measures. But clearly, you can't sprint the whole way. And so if you could continue to increase the AUC as the metaphor continues here, the goal is that we would be able to unlock more growth. And the goal is to maximize the effect that CNP can deliver and to have a really best-in-class CNP to not only unlock that profile, but even in a future state where there might be rational sequences or combinations that this would be the drug of choice that would want to be partnered in those for these patients.

Yes. And you guys have spoken publicly about wanting to move into a Phase II/III and even running it as a superiority study versus VOXZOGO. What can you tell us at this point? I mean, what -- have you decided on the trial design, are you still engaging with regulators about the trial design? Where are you at? And what can you tell us at this stage about that Phase II/III?

So this is -- it still remains a dynamic process. We're engaging with regulators. Now when we engage with the regulators, we have what's called the study concept design. It's not a full protocol. It's not locked in, but it has all the elements that we're speaking about here. What we've envisioned and what we've agreed upon for the path forward is a combined Phase II/III study. This would give us an opportunity to move immediately into patients. So there's no multi-dose study in healthy volunteers that's needed. We'd immediately move into achondroplasia patients, and we would offer them a Phase II study that would have potentially 4 arms, high and medium and a low dose of BMN 333 and a control arm of VOXZOGO. No placebo there of note. That would allow us in short order to determine, again, what we think the go-forward dose should be. Of course, we want it to be as effective as possible. Effective meaning not just linear growth, that is what we can measure. It's what we can measure at 6- and 12-month time frames. But what we ultimately want to deliver is better health and wellness for these patients. So we'll be measuring other factors along the way. We were leveraging the data that we have from our ongoing VOXZOGO program to, again, preclude the need for a placebo arm. We can model that arm, and that's been acceptable thus far to regulators. And of course, from a statistical standpoint, we're using as much borrowed information from VOXZOGO to try to limit that arm as well. And once we've had that dose, we'll immediately move into a Phase III, which would be a head-to-head study in achondroplasia of a chosen dose of BMN 333 versus VOXZOGO. Again, no placebo here. We think that, again, in this world, not only would that be attractive to patients, they wouldn't necessarily have to sign up for a placebo-controlled arm. But we also think this is what the marketplace wants. Not just a me-too drug, not just a convenience lever, but they're going to want something again, that offers them more value, not just in linear growth again, but also in the health and wellness. So we're continuing to show that in -- with VOXZOGO, again, the first generation molecule, this isn't just about growth, this isn't just about final adult height. We're seeing tibial bowing improve in these patients. We're going to be presenting next week some data with regard to spinal alignment, spinal canal width. We're seeing facial morphometry improvements, which, of course, are a surrogate for things like Eustachian tube abnormalities, ENT abnormalities. We want these patients to live their best lives with the most wellness that they can. And again, we think it's part of our job not only to develop new agents, but take the agents we have and show as much data as we can and be transparent on what that value is.

And what gives you confidence that you think you'll show superiority over VOXZOGO?

So there's three data sets. I mentioned the animal data set. Of course, we mentioned before the genetic data that suggests, again, people with activating mutations of NPRB or of high levels of CNP, have quite a bit of growth that can be uncorked. And quite frankly, if you just look at the clinical data that's out there with long-acting CNP agents, there is not a suggestion so far that there's a data point where the efficacy seems to flatten out. So continuing that curve upwards on the AUC, we think this is a very good bet. We suspect it will be a very safe opportunity and our goal to prove that and ultimately, to measure that in patients with achondroplasia. Next step is to be in patients in the first half of next year, and we're moving with urgency to be able to deliver that.

Okay. Great. We're looking forward to that study kicking off and the data that's coming out from the healthy volunteer study. A lot going on outside of achondroplasia too. Obviously, hypochondroplasia Phase III, VOXZOGO data coming next year. But even beyond that, there are a number of other short stature indications. And I know you've talked about wanting to move into Phase III with VOXZOGO, but also the potential now for BMN 333. So maybe just walk us through the thought process in terms of the development path forward for some of those additional indications. I hate to ask the question about time lines, but when will we get the next update? And then how do you think about now that you are -- that you do have these two molecules that you could potentially move forward with development?

Yes. And it's important not to put the cart ahead of the horse here. And of course, achondroplasia and hypochondroplasia are fairly related conditions, even the regulators allowed us with hypochondroplasia to move right into Phase III without dose ranging. For additional short stature indications, whether they're proportional with idiopathic short stature or disproportional with, for example, Noonan, Turner and SHOX syndrome. We are doing and looking forward to seeing data from dose-ranging studies with VOXZOGO. We have publicly stated that, that data will allow us to make a decision to start Phase IIIs in those indications in 2027. Now that happens to line up quite nicely with our dose ranging that we will see coming out of our BMN 333 as well, where in achondroplasia will have an idea again of dosing schedule, effect size and so forth. I mentioned schedule, it's planned for weekly at this point for 333. There could be an opportunity to elongate that, but that's not our goal right now. That data will line up in the 2027 time frame, and we'll be able to look at not only the efficacy and safety, but also the totality of data from the three programs. We're also considering other indications. The nice thing about CNP is, it's not dependent on an FGFR3 mutation in order for it to have its activity. It is a master regulator of growth. And by administering it to patients with a variety of conditions, we do believe there would be an opportunity to address their underlying condition. That being said, the dose and schedule and the effect side may be very different in indications that are not as so-called dysplastic as hypochondroplasia and achondroplasia. And as a result, doing the dose ranging is going to be a very important part, not just from a regulatory standpoint, but also from a safety and appropriateness standpoint in order to choose those doses. We're going to have a lot of data in that 2027 time frame. And I think, again, we're going to be in a good position to be able to make an evidence-based decision.