Release Date: September 03, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Ascendis Pharma A/S (ASND, Financial) received FDA approval for YORVIPATH, the first and only treatment for hypoparathyroidism in adults.
- TransCon Growth Hormone (TransCon hGH) is approved in both the US and EU for pediatric growth hormone deficiency.
- SKYTROFA volume more than doubled in Q2 2024 compared to the same period last year.
- YORVIPATH patient retention rate is extremely strong at around 98%.
- The company is expanding its pipeline into new therapeutic areas such as oncology, obesity, metabolic disease, and cardiovascular.
Negative Points
- SKYTROFA reported revenue decreased by 27% year-over-year due to higher sales deductions and adjustments.
- Total operating expenses for Q2 2024 were EUR157.8 million, a 10% decrease compared to the same period in 2023, but still substantial.
- Net finance income can fluctuate significantly quarter-to-quarter, impacting financial stability.
- Cash, cash equivalents, and marketable securities decreased to EUR259 million from EUR399 million as of December 31, 2023.
- The company had to enter into a new capped synthetic royalty funding agreement with Royalty Pharma for USD150 million, indicating a need for additional capital.
Q & A Highlights
Q: I want to better understand how you project getting SKYTROFA to a blockbuster in the US alone based on the kind of reset of net price and what you said about where you are in terms of penetration in GHD and the broader treated growth hormone market. Can you walk through that a little bit?
A: (Jan Moller Mikkelsen, President and CEO) Currently, the US growth hormone market is about USD1.4 billion. SKYTROFA has about 3 times the net value per patient annually compared to other treatments. We see SKYTROFA as the preferred brand in the long-acting segment, even in areas where market access is equal. We are filing for Adult Growth Hormone Deficiency and have Turner Syndrome Phase 2 data coming soon, which will help expand our market reach.
Q: With regards to this new net price that you have for SKYTROFA, can you talk to us about the competitive dynamics? Namely, are the daily injector manufacturers offering deeper discounts? And can you also talk about the level of impact that you're seeing from the recent -- relatively recent launch of Novo competing product?
A: (Jan Moller Mikkelsen, President and CEO) There are two other long-acting products in the US market. We see SKYTROFA as the preferred product due to its best-in-class potential. The largest volume supplier of growth hormone saw a revenue drop of 73% in Q2, indicating a market reset. We are confident in SKYTROFA's position and potential for growth.
Q: Just wanted to know what payer feedback you might have received thus far on the proposed YORVIPATH pricing in the US?
A: (Jan Moller Mikkelsen, President and CEO) We are coming out with responsible pricing aimed at supporting all patients with hypoparathyroidism. We have not received any negative feedback regarding our pricing strategy.
Q: Maybe help us understand what went into the assumptions for the lower guidance for SKYTROFA for this year. Just looking for more details on what's driving that EUR100 million reduction.
A: (Jan Moller Mikkelsen, President and CEO) We saw a growth in volume between Q1 and Q2 and used that to predict the rest of the year. The broader market access reset negatively impacted our first-half net revenue. We expect the GTN (gross-to-net) to remain constant throughout the year.
Q: For SKYTROFA, when did these policies with more favorable access go into place? And when should we expect a pickup in prescriptions?
A: (Jan Moller Mikkelsen, President and CEO) The policies were gradually implemented during the first half of the year, with some taking effect in Q2. We expect the full impact of these policies to be seen in the second half of the year.
Q: For the upcoming ApproaCH readout and the COACH readout in 2Q '25, what parameters of data do you expect to report out, and how should we compare these data sets to competitor CNP data sets?
A: (Jan Moller Mikkelsen, President and CEO) We aim to provide both linear growth and address comorbidities. Our Phase 2 data showed similar annualized growth velocity to vosoritide and improved quality of life related to physical function. We hope to replicate these results in our pivotal trials.
Q: Could you please elaborate more on your ongoing interactions with regulators regarding the commercialization of existing batches for the US launch of YORVIPATH?
A: (Jan Moller Mikkelsen, President and CEO) We have a constructive dialogue with the FDA to address the shortage of PTH drops in the US. Both patient organizations and physicians recognize the unmet medical need, and we are working together to find a solution.
Q: Can you comment on what percentage of your payer contracts were affected by the true-up for SKYTROFA and whether these changes are multiyear?
A: (Jan Moller Mikkelsen, President and CEO) The implementation of new contracts was a continuous process through Q1 and Q2. We have now reset our coverage in the US, and we expect the GTN to remain consistent for the next five years.
Q: Can you maybe comment on the Royalty Pharma agreement and whether this is the last source of external capital needed before achieving operating cash flow breakeven?
A: (Jan Moller Mikkelsen, President and CEO) The Royalty Pharma agreement provides us with USD150 million. We continue to scrutinize costs and aim to achieve operating cash flow breakeven either this year or next year.
Q: Can you clarify the guidance for SKYTROFA revenue for the year and whether the EUR53 million in Q2 is a good run rate for Q3 and Q4?
A: (Jan Moller Mikkelsen, President and CEO) The real number for Q2 is around EUR53.4 million, including the true-up. We expect an improved pickup in Q3 and Q4 and have taken a conservative approach in our forecasting, not accounting for any seasonal effects.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
