Ascendis Pharma - Earnings Call - Q2 2025

Transcript

Speaker 0

Good day, and thank you for standing by. Welcome to the Q2 2025 Ascendis Pharma earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press *11 on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press *11 again. You may ask one question and one follow-up. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Scott Smith, Ascendis Pharma's CFO. Please go ahead.

Speaker 2

I'm on the talk operator, and thank you everyone for joining our second quarter 2025 financial results conference call. I'm Scott Smith, Executive Vice President and Chief Financial Officer at Ascendis Pharma. Joining me on today's call are Jan Møller Mikkelsen, President and Chief Executive Officer; Sherrie Glass, Chief Business Officer; Jay Donovan Wu, Executive Vice President and President of US Markets; Aimee Shu, Executive Vice President of Endocrine and Rare Disease Medical Sciences and Chief Medical 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.

Examples of such statements may include, but are not limited to, statements regarding our commercialization and continued development of SKYTROFA and YORVIPATH, as well as certain financial expectations, our pipeline candidates, and our expectations with respect to their continued progress and potential commercialization. Our strategic plans, partnerships, and investments, our goals regarding our clinical pipeline, including the timing of clinical results and trials, our ongoing and planned regulatory filings, and our expectations regarding the timing and the results of our regulatory decisions. These statements are based on information that is available to us as of today. Actual results may differ materially from those 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 filed with the SEC on February 12, 2025. TransCon Growth Hormone is now approved in the U.S. by the FDA for the replacement of endogenous growth hormone in adults with growth hormone deficiency, in addition to the treatment of pediatric GHD, and in the EU has received MAA authorization from the European Commission for the treatment of pediatric GHD. TransCon PTH is approved in the U.S. by the FDA for the treatment of hypoparathyroidism in adults, and the European Commission and the United Kingdom's Medicines and Health Products Regulatory Agency have granted marketing authorization for TransCon PTH as a replacement therapy indicated for the treatment of adults with chronic hypoparathyroidism.

Otherwise, please note that our product candidates are investigational and not approved for commercial use. As investigational products, the safety and efficacy of the product candidates have not been reviewed or approved by any regulatory agency. None of the statements during this conference call regarding our product candidates shall be viewed as promotional. On the call today, we'll discuss our second quarter 2025 financial results, and we'll provide further business updates. Following some prepared remarks, we'll then open up the call for questions. With that, let me turn it over to Jan.

Speaker 3

Thanks, Scott. Good afternoon, everyone. The second quarter of 2025 demonstrated strong momentum towards fulfilling our Vision 2030. As we progressed towards blockbuster status for multiple products and expand our engine for future innovation, the continued strong global launch of YORVIPATH increases our confidence that YORVIPATH is on the way to become a blockbuster product with durable global leadership for the treatment of chronic hypoparathyroidism. The FDA granted us priority review for TransCon CNP, recognizing its potential, if approved, to provide a significant improvement in the safety and/or effectiveness of the treatment of achondroplasia. The announcement of the interim Phase II data from the first combination therapy trial of TransCon CNP and TransCon Growth Hormone highlights our potential to boost healthy growth in achondroplasia. We achieved the first of many planned label expansions for SKYTROFA when the FDA approved it for treatment of adult growth hormone deficiency.

I will review these key developments in more detail in my prepared remarks. Beginning with YORVIPATH, revenue in the second quarter reached €103 million, more than double Q1, despite a strong currency headwind. In the U.S., from launch to June 30, more than 1,500 prescribers wrote prescriptions for around 3,100 unique patients, reflecting both a deep unmet medical need and compelling product profile. For U.S. patients receiving a prescription for YORVIPATH, the majority have received payer approval within three months. Outside of the U.S., we continue to see steady YORVIPATH revenue growth in both our Europe Direct and international markets, and we currently expect further acceleration of the revenue growth when YORVIPATH reimbursement becomes available in additional Europe Direct countries.

With a broad label covering all types of chronic hypoparathyroidism, supported by international guidelines, and a prominent reference to YORVIPATH in recently published best practice consensus statement, we expect growth to continue. We have an ongoing clinical program to support label expansion, for example, in older children, and initiated the Pathway 60 trial, a single-arm, safety, and efficacy trial to support titration up to 60 microgram doses in the U.S. The primary endpoint of this trial will be efficacy at 26 weeks, the same as our pivotal Phase III trial endpoint. We are building towards YORVIPATH's long-term global leadership based on three key pillars: differentiation, demand, and access. I will first speak about differentiation through mode of action. A replacement therapy for hyperpara must maintain the same mode of action as endogenous PTH throughout the body and sustain a physiological level of PTH 24 hours, seven days a week.

Based on all the data we have seen, YORVIPATH is the only product to demonstrate it can do this with normalization of key elements such as serum calcium, phosphate, kidney function, bone turnover, and quality of life. Second is demand. Where YORVIPATH is available, we see strong interest and growing enrollment. For the U.S. market, in just two full quarters, we had around 3,100 unique patients enrolled across more than 1,500 prescribers. We're seeing a broad uptake across the entire country. With our estimate of 70,000 to 90,000 patients in the U.S., we still have ample room to grow. Outside the U.S., we have recognized revenue from more than 30 countries, and currently, we have a commercial agreement covering more than 75 countries. Third is access. In the U.S., we see favorable access continue to improve, with approvals coming across all payer segments.

In Europe Direct, we have full commercial launch in Germany, Austria, and now Spain. We expect additional commercial launches later this year, both in Europe Direct and international markets. In Japan, our partner expects approval for YORVIPATH later this quarter. We consistently hear about how transformative YORVIPATH has been for patients. We do not believe that any publicly disclosed drug in clinical development has the potential to meet this efficacy and safety bar set by YORVIPATH. As shown in our clinical trial, it has been extended for all patient groups, post-surgical HP patients, to small genetic subtypes like DiGeorge syndrome, ADS1, and idiopathic hyperparathyroidism. Notably, YORVIPATH has brought approval from the FDA, the European Commission, and other regulatory authorities for the treatment of all forms of chronic hypoparathyroidism.

For all of the above reasons, we are confident that YORVIPATH has the potential to become a durable blockbuster over time and will continue to expand our global leadership position in the treatment of hyperparathyroidism. Moving now to TransCon CNP. We believe TransCon CNP is moving the bar on safety, efficacy, and tolerability and reducing treatment burden. We believe TransCon CNP is well positioned to become the leading monotherapy treatment for achondroplasia. In clinical trials, we have seen the desired linear growth across all ages. To our knowledge, once-weekly TransCon CNP is the only product to show statistically significant improvement beyond linear growth compared to placebo in a pivotal trial, for example, improvements in leg bowing and quality of life. We have demonstrated a safety and tolerability profile comparable to placebo, including no evidence of hypersensitivity effects and an extremely low frequency of mild injection site reactions.

Since our announcement of monotherapy data, we have engaged with patients, advocates, physicians, and regulators. All have appreciated the differentiating ability of TransCon CNP in comparison to placebo to increase linear growth while also leading to stronger muscle function, improved body proportionality and leg bowing, and reducing overall the burden of achondroplasia-related complications for the majority of treated children. Patients and caregivers appreciate the much lower burden of once-weekly injection. During the second quarter of 2025, the FDA accepted our NDA submission for priority review with a PDUFA date of November 13, recognizing TransCon CNP as a therapy that could, if approved, provide a significant improvement in safety and/or effectiveness. Next, I will review our combination trial results. As we look forward to the anticipated approval of TransCon CNP as monotherapy, we are investigating it in combination with our once-weekly TransCon Growth Hormone in children with achondroplasia in our co-trial.

In June 2025, we announced week 26 interim results, which showed a clear boost in linear growth and body proportionality improvement, with a safety and tolerability profile consistent with those observed for monotherapies. In the combination trial, both treatment groups exceeded the 97% threshold for growth of an average state of children, meaning they are achieving linear growth at a rate higher than an average child. The week 26 data demonstrated the potential to boost growth of around 3x, or three times above that observed with monotherapies addressing the hyperactive FGFR3 receptor pathway, supporting the scientific rationale for treating with TransCon CNP and TransCon Growth Hormone combined. These results are without precedent in achondroplasia. Importantly, we see clear indications that it's healthy growth, with linear growth accommodated by improvement in body proportionality and without acceleration of bone age. All patients continue in the study as of today.

These results enforce the role of TransCon CNP as a strong fundamental therapy in achondroplasia. We look forward to our 12-month release later this year and plan to start a Phase III study of the combination therapy in children with achondroplasia by the end of 2025. In addition, we also expect to initiate a pivotal combination trial in hypochondroplasia. I will now turn to SKYTROFA. SKYTROFA is established as a high-value brand and a treatment of choice for pediatric growth hormone deficiency. We recently received FDA approval for adult growth hormone deficiency, and with further label expansions planned, SKYTROFA remains a fundamental pillar in our strategy to become the global leader in the treatment of growth hormone disorder. Q2 revenue for SKYTROFA was €51 million. We continue to see growth in the number of people treated with SKYTROFA based on new patient stats.

We expect the recent label expansion for adult growth hormone deficiency to further drive long-term growth. Our market research shows SKYTROFA is the treatment of choice for pediatric growth hormone deficiency among patients and physicians. We believe we can achieve the same status for treatment of adult growth hormone deficiency. Our Phase III basket trial of SKYTROFA, planned to begin later this year, will include a range of established daily growth hormone indications, including ISS, short stature Turner, and SGA. I often say that Ascendis Pharma is just getting started. Following closely behind this major growth opportunity, our research team is developing the next wave of innovative TransCon technology and product candidates. In addition, our ongoing collaboration with Novo Nordisk for the development and commercialization of TransCon-based products in metabolic and cardiovascular diseases continues to make progress towards the clinic. Ascendis Pharma is demonstrating a significant inflection in revenue growth.

We are gathering important new clinical data, working towards additional key label expansions. We are advancing new blockbuster opportunities to drive growth for many years to come and fulfill our vision 2030. We are already preparing for our next vision. I will now turn it over to Scott.

Speaker 0

Thank you, Jan. I will touch on some key points surrounding our second quarter financial results, but for further details, please refer to our Form 6-K filed today. For Q2, our total product revenue was €153.7 million, which includes a negative sequential foreign currency exchange rate impact of €7.6 million. SKYTROFA revenue for the quarter was €50.7 million, including a €1.8 million negative currency impact. YORVIPATH delivered strong performance, with revenue more than doubling to €103 million, up from €44.7 million in Q1 2025. This revenue growth was achieved despite a negative sequential currency headwind of €5.8 million. Sequential growth across global markets remains strong, with continued strong uptake in the U.S. acting as a key growth catalyst. The YORVIPATH U.S. launch and continued performance outside the U.S.

are having a substantial impact on our financial profile, and we expect Ascendis Pharma to become cash flow positive on a quarterly basis this year. Including €4.4 million of revenue from our collaboration partners, total Q2 revenue was €158 million. Turning to expenses, R&D costs for the second quarter decreased to €72 million, compared to €83.5 million in the same period last year, primarily driven by lower development costs for growth disorders. SG&A expenses in the second quarter of 2025 increased to €107.6 million, compared to €74.3 million in the same period last year, primarily driven by global commercial expansion. Total Q2 2025 operating expenses were about €180 million. Net finance income for the second quarter of 2025 was €22 million, driven primarily by non-cash items. Net cash financial expenses for the second quarter of 2025 were €5.3 million.

We ended the second quarter of 2025 with cash and cash equivalents totaling €494 million, compared to €518 million as of March 31. Of the €24 million sequential decrease in cash, €19 million of that was due to the June 30 cash translation to euros, so pretty close to overall cash break even for the quarter for the company. Turning to the remainder of 2025, we expect continued revenue growth driven by the strength of the global launch of YORVIPATH. For SKYTROFA, for modeling purposes, we continue to believe that sequential revenue growth for 2025 should track growth in prescriptions, offset somewhat by payer mix and normal seasonality. We also expect long-term growth for SKYTROFA to be driven by label expansion, with our recent adult approval expected to only contribute modestly for 2025. We also continue to watch the euro/U.S.

dollar exchange rate for any potential impact related to reported revenue. For YORVIPATH, our launch is progressing exceptionally well. Globally, we see YORVIPATH as a standard of care for treating chronic hypoparathyroidism, and we believe it has the potential to achieve multiple billions of euros annually in peak sales over time. Our focus is on building long-term leadership. In the near term, as investors and analysts seek to model YORVIPATH's growth trajectory, I would highlight the following. Outside the U.S., we currently see continued steady sequential revenue growth. In the U.S., seven months into launch, we are seeing strong continued demand and continuation of enrollment trends. We are seeing good conversion from enrollment to paid prescriptions with YORVIPATH. As Jan mentioned, the majority of U.S. patients are approved for reimbursement within three months of enrollment. Payer approvals are broad across commercial and government, as well as geographies.

We expect additional coverage policies and payer agreements to facilitate patient experience, access, and continued long-term uptake. Based on our data so far, we expect persistence to be high because of the benefits to the patient, and we continue to monitor. We will continue to look to help investors understand uptake and reimbursement dynamics as the year progresses. With that, operator, we're now ready to take questions.

Speaker 2

Thank you. At this time, we will conduct a question and answer session. As a reminder, to ask a question, you will need to press *11 on your telephone and wait for your name to be announced. To withdraw your question, please press *11 again. You're allowed one question and one follow-up question. Please stand by while we compile the roster. Our first question comes from Jessica Fye from JPMorgan. The floor is yours.

Hi. Thanks, guys. Great quarter. You mentioned you're seeing a continuation of enrollment trends, and I think the number of unique patients enrolled grew by about 1,350 in Q2. Is that the rate you mean that you see continuing? Thank you.

Speaker 3

Hey, Jess. I can start with a few overall views, and then perhaps Jay can follow up. The number we reported was around 1,750 for the end of Q1. Here, the end of Q2, we reported 3,100. What we also said in our Q1 call, that 200 patients, we will consider some kind of a bolus injection because the 200 patients came from our EFE program. When I take the numbers out from our Q1 number, the 200, it gives me about 1,550. In some way, I actually believe that we see a steady state growth in the patients here between Q1 and Q2 when I take this consideration to the 200 patients that came from the pool. This is how we basically see the numbers, and this is very much aligned with our comments at the Q1 call.

We expect us to see a steady state development in the prescription. First, in the second part of the year, we expect to have an acceleration of the conversion of a patient that has a prescription to be on treatment. That is basically what we have seen. We look forward to seeing Q3 and Q4. We are extremely optimistic about this launch. I'm not just talking about the U.S. We see the same pattern everywhere where we're launching, but it really is amazing. We expect to see the same steady state. Sure, that can be a seasonal factor because of the summer vacation. At least we know in France, August is closed, and other places are happening the same thing. Jan, further comments?

Speaker 2

Thank you, Jan. As mentioned before, we are seeing that stabilization in enrollment. We're still early in the launch, so we will need more time to observe what that steady state trend will be as we get more months under our belt with the launch. More importantly, just as Jan mentioned earlier, we're focused beyond just the point of enrollment, right? We're looking across the entire funnel, from enrollments to approval, from approvals to patients on therapy. We are seeing continued growth, especially as it relates to the conversion of those patients onto therapy, and we're feeling good about what we are seeing.

Speaker 3

Thanks, Jay.

Speaker 0

Thank you for your question. Our next question comes from Derek Archila from Wells Fargo. The floor is yours.

Thanks for taking that question, and congrats on the progress here. I just wanted to confirm something. It sounded like you noted that there's three months from enrollment to conversion. I just wanted to know, what are you doing to kind of improve that? I guess how much progress can you make on improving on that three months? Thanks.

Speaker 3

Nothing has really changed compared to what we said on our Q1 call. There are a lot of elements that Jay and the entire integrated commercial team are working with. We can go a little bit more in specific, but in the overall view, sure, the different politics from the different PPM need to be installed. There are a lot of elements that still take time. We're also working a lot on the procedure, how we basically can help patients to be sure, and physicians and back office. This is happening for our ASAP program that we are helping the patient.

Nothing has changed compared to what we said in Q1, where we believe that we will first see in the second part of the year when many of these activities will be implemented, we will see an improvement in the time from a prescription to a patient is on treatment. Jay, you can give a little bit more flavor on some of the initiatives on a high level because we have so many initiatives going on.

Speaker 2

Absolutely. Thank you for the question. From a time-to-approval standpoint, as we said, we're seeing the majority within three months. I would divide our efforts probably in a few buckets. The first one is upstream, right? We're continuing our payer education, whether it's at a commercial level or a public level, just on the clinical value proposition of the product, the full expanse of her label. As you can all appreciate, whenever there's a new specialty drug on the market, particularly a rare disease one, it oftentimes takes a bit of time for them to consider either a category or product that they may not have previously had on formulary or plan. We anticipate that to continue to improve, which will, of course, have downstream impacts on the speed. More downstream from that, we also have a very experienced hub, right? I think we've mentioned this before.

We're quite experienced with being in managed care spaces. Some of the bread and butter work as it relates to ensuring that providers and patients are continuing to follow up, fill out their paperwork correctly, to decrease cycle times, to ensure that that paperwork isn't the reason why maybe something goes back and forth one or two extra times, which will then also increase the cycle. Lastly, I would say, as we continue to have patients within the funnel, just making sure again that our partnership with our specialty pharmacies, so on and so forth, again, streamlining those processes to continue shave-off time as we work through this initial launch phase. All that to say, we're incredibly encouraged by the speed in which we're seeing and a reflection of the experienced hub that we have. We continue to look forward to seeing how that will progress.

Great. Thank you.

Speaker 0

Thank you for your question. Our next question comes from Tazeen Ahmad from Bank of America. The floor is yours.

Hey, guys. Thanks for taking my question. I was wondering if you could give some color on the type of patients. There's been a lot of talk about initially severe patients, the most severe patients being put on YORVIPATH first. Do you have any color on what the split is between definitionally what a severe patient is versus the type of patients that are getting on that might be on the more moderate side? Thanks.

Speaker 3

Thanks, Fanny, for the question. First of all, there is no medical definition that defines the severity of hyperparathyroidism. We cannot go in and claim a database and say this is a severity that you have in the disease because all of them are not classified related to that. When we talked about the element of being uncontrolled, partly controlled, or something we call controlled, it was mainly related to one single parameter, looking on the claim databases and seeing how often they're sitting in a physician. How often they're sitting in a physician, I think, has a lot of multiple aspects that someway are not only reflecting where you're living in the country, what kind of medical access do you have, and also how often are there individuals that really can see you.

We did it out from this perspective because we wanted to be quite sure we are addressing a physician that sees a high number of patients in hyperparathyroidism. It was why we addressed this physician as our priority in our, you can say, commercial strategies. We can certainly not define and answer your question because there is no way this is part of the reimbursement system. It's no part of we can see of the patient because it's not a medical term that ever is defined. I think, someway to give you also the other aspect on it, when we look on the guidelines that we see being integrated in many different places, they are not using this kind of term either. The guidelines just have a broad aspect on all the different elements that really qualify to be on PTH treatment.

In general, all the guidelines we have seen being issued from all different places in the world now, they are indicating that 95% of all patient bases should be on PTH treatment. I think that is pretty logical. Think about how many patients on type 1 diabetes. Would you ever consider that you will not take all patients that have type 1 diabetes on insulin treatment? I think you will see the same thing happening with hyperparathyroidism.

Speaker 0

Thank you for your question. Our next question comes from Li Watsek from TD Cowen. The floor is yours.

Great. Thanks for my question and congrats again. A couple of interrelated questions. Can you give us a little bit of a sense, Scott? You mentioned last quarter to expect Europe to grow about $4 to $5 million. That puts you at around $24 million. It almost seems like you did sort of $79 to $80 million in the U.S. Am I sort of in the ballpark? I guess secondly, when one looks at it, we shouldn't be expecting that you're going to be growing patients 1,500 quarter over quarter. Can you give us a little bit of a sense of how to think about what a sequential normalized growth at this point in the U.S. can be so we don't get out of hand? Thank you.

Speaker 3

I can see I can help, Scott, this time, which I often do. Because what we said in our Q1 call, and if you look on Q3 to Q4, revenue increase, net revenue in euros was about €4 million to €5 million. In these two quarters, it was basic euros or ex-U.S. revenue. We also said at that time that we expect that to continue in 2025 when we see more countries coming on full commercialization, as we just got Spain now. We expect a few countries more, perhaps it will increase. It will first have a material impact two to three months after basic initiation of full commercialization. I will say your assumption is pretty correct and also reflects what we said in Q1 this way. Related to the question you commented, it's somewhat a forward-looking statement. I know it's really being covered by Scott's fast reading.

From my perspective, it is that we see a strong, strong launch here in the U.S. We have seen nearly the same numbers between Q1 and Q2. We're really looking forward, as Jay said correctly, this is early in the launch. It will be too early for us to come up with any kind of prediction how we really will see the next six, seven quarters to go.

Speaker 0

Thank you for your question. Our next question comes from Gavin Clark-Gartner from Evercore ISI. The floor is yours.

Hey, guys. Congrats on another great quarter. First, what do you believe the ultimate conversion rate from the enrollment forms to paid drugs will be at any point in time? Secondly, looking ahead, do you plan to keep reporting the enrollment forms for YORVIPATH? Thank you.

Speaker 3

It's really difficult for us to give you a clear number. What we always will see in the U.S., there will be a percentage of patients that have really difficulties to get reimbursed, even if we try and help them multiple times. What we see during the launch, which we have seen before, is that what I call the tail is getting faster and faster cleared out. I can guarantee we will do everything in Ascendis' manner to help that all the patients can come on treatment. Can we guarantee that everyone can go on treatment? No. There will be a number of patients, even after 6, 9, 12 months, really struggling. We will say it's really hard to be covered. You can ask about my personal success.

My personal success will be if we get in a steady state launch, really with a mature product, can get around 90% of all patients on treatment. I will feel it as a personal success and my contribution to help patients with hypoparathyroidism. Jay, you can also come with your personal success number if you want to do that.

Speaker 2

Appreciate the question. I would say layer on a couple of things, right? I think the enrollment to approval, again, it's not just driven by payers. Of course, that's a component of it, right? As we discussed before, there are certain plans and policies for which you have to go through exception or appeals process. I think, as Jan alluded to, that right tail will take some time to clear depending on the plan and as things evolve. The other component from enrollment to approvals is entirely unrelated to payers. It may just be more driven by ensuring providers are leveraging the paperwork appropriately, patients are following up with outreach, a lot of that, which we'll continue to pursue across the spectrum because we know that these patients can and should benefit from the product if they're already in the funnel.

We will do everything we can to clear that long tail out, knowing that it will take some time. When you look at a lot of rare disease analogs in these types of spaces, it can take some time to get there. This is a long haul, and we're looking at it more from that lens to making sure we're optimizing every step of the way.

Are you guys planning to report enrollment forms for YORVIPATH in the next quarter also?

Speaker 3

I think we will give you the necessary KPIs that we're doing today. We will continue to do that every quarter until we feel we're coming to a steady state where we feel that there's enough information just out from revenue that you can basically do your modeling. Until that, we will continue to provide the necessary data that support that you can make a solid modeling of the launches. Just to say and repeat it again, this is an amazing launch. Q1 was great. Q2 was also amazingly great. We have not seen any weakness in the launch.

Very helpful. Thanks.

Speaker 0

Thank you for your question. Our next question comes from Li Watsek from Cantor Fitzgerald. The floor is yours.

Hi. Congratulations on the quarter. This is Daniel Bronder on for Li Watsek. We're just curious about the pull-through of the patients that get onto YORVIPATH. How should we think about compliance, especially if you're saying that 1,500 PFS number, it's net patients going forward. Thank you.

Speaker 3

Where we have the best long-term data is from Europe, where we basically started the launch about six to nine months before. When we look on a rate, what we call true discontinuation, it's extremely low, a few %. We really see the benefit of the therapy. People are taking the therapy, taking it, they're keeping doing it. I believe that is the contribution on how we are addressing a major unmet medical need with the treatment of YORVIPATH. Everything we see here is a far way from what you see with a diabetes drug. People stay on it, even much better than insulin that you see in type 1 diabetes. I think this is a main contribution to the positive CNS effect that is with this product.

OK, cool. Thank you. Just going back to Yoran's question earlier about the 1,500 patient net enrollment per quarter, just for me to fully understand, this is the patient start forms that you're referring to?

Yeah, that is what we're referring to as unique prescriptions, meaning that it's a new patient that has got a prescription. This is what we call unique prescriptions.

Great. Thank you so much. Congrats again.

Thanks.

Speaker 0

Thank you for your question. Our next question comes from Joseph Schwartz from Leerink Partners. The floor is yours.

Yeah, hi. I'm Julia Park, dialing in for Joe. Thank you for taking our questions. The first one is on YORVIPATH. I believe there were 1,500 prescribing health care providers in the U.S. by the end of the quarter. Can you help us understand how much of your target physician base this represents? Secondly, on TransCon CNP, a competitor recently announced that their long-acting CNP's area under the curve PK level was three times greater than the levels of TransCon CNP. Based on your experience with TransCon CNP, how could that translate in the clinic in your view? How does that profile differ from your combination approach? Thank you.

Speaker 3

Yeah. Let me start with the easy one, or potentially, I will someway take that over to Jay Wu. I will take the more, I can say, scientific interesting question as number two.

Speaker 2

Sure. Happy to start with the first question. From a target list standpoint, we're talking about 8,000 to 10,000, so you can consider that as our universe, about 3,000 of which we decile as high-medium. We're seeing pretty good field execution metrics across that, with over 80% reach across our high-medium priority targets.

Speaker 3

The second question is interesting because for many, many years, there was a lot of skepticism about our sustained profile. Suddenly, there was a big change where somebody said there is some benefit by having a sustained profile that does not give a high Cmax, that basically can indicate risk of hypotension. You need to have continuous exposure over one week. We started and designed our TransCon CNP in 2015. Now we are in 2025. They're starting now to go after that concept. From my perspective, when you look at how we designed it and also all our associated patent filing we have with it, all the IP we have of the optimal product, the medical treatment benefit it is, and other things like that, people are now trying to copy with other concepts.

When I think about the concept, I think there was some kind of making success of a product without disclosing the key element. The key element that was AOC. I really don't care about AOC. I want to know the key element, what is really the half-life? How is this exposure really happening? Is it something that picks up to a very, very, very high value very shortly, and then you basically are going up to, as they call it, the danger zone of hypotension? That is not really an optimal product in this way. I believe what we saw in all our clinical data, it's really hard to do a lot when you remove a brake because it's really the hill is rolling down that really decides the speed. If you have taken the brake off, the brake is off.

That is where I really don't get the biological and scientific concept. That is related to linear growth. When we look at some of the other effects where we see muscle strengthening and other things like that, I'm quite sure having continuous exposure. We do not know exactly if that is maxed out or not. Out from that perspective, it's very doubtful. Can you get more out on having a higher AOC? First of all, you need to have the right AOC. It must be a higher exposure completely over the once-weekly profile. No one discloses that because then they need to have a longer half-life than ours that is about two and a half to three days. I have not got any kind of disclosure that they are there.

When I go out to our combination therapy, it's basically a completely different concept because the concept of that is between synergies between different biological pathways, which are well known from so many other therapeutic areas. To have the optimal treatment, you cannot overcompensate just by one pathway, but you're basically providing the benefit in a holistic manner, in a much more normal manner by balancing different pathways. That is what we do in the combination between TransCon CNP and the Growth Hormone effect, which are basically at the same time in a more simplified manner, remove the brake with what we do with the CNP, and then having a speed on that. I feel really, really confident with our code state, our combination therapy. That really is a unique way where you really can totally provide for patients, for physicians, a completely new treatment standard.

Got it. Thank you.

Speaker 0

Thank you for your question. Our next question comes from Li Watsek from UBS. The floor is yours.

Hey, guys. Thanks for taking my question and congrats on this round quarter. Curious, for achondroplasia, what's your base case for the indication statement for TransCon CNP, whether it would be for the treatment of achondroplasia or for the increase in linear growth in achondroplasia like VOXZOGO has, and I guess any expectations for differentiation in the label relative to VOXZOGO, such as in terms of the indication statement or, say, other secondary endpoints? A follow-up question. Just what's your perspective on the IP landscape for weekly CNPs? Specifically, any thoughts on BMN 333 and where that might stand relative to the TransCon CNP IP estate? Thanks.

Speaker 3

Yeah. We are progressing through the regulatory review with our TransCon CNP exactly as we hoped for in an accelerated priority review. Everything is happening at the right time. Labeling discussion is one of the last parts in the review cycle. It's really, really difficult for me to come up with any kind of elements. What I'm more referring to is the data we have that is really backing up TransCon CNP. I believe this is why we got the priority review, because we have data that gives us strong evidence that we can provide treatment benefits beyond linear growth. Now we're talking about everything we have seen related to leg bowing, everything we have seen to muscle strength, because people are saying that they have also seen it. You are not seeing it in a real manner.

You need to see it in a placebo-controlled manner because either body proportionality is actually improving during a normal development of a child, also to an achondroplasia child. How can you discriminate if it really is a treatment benefit or just a normal development? This is why it's so extremely important to be in a position that you are referring to data that's done in a placebo-controlled manner in a properly controlled trial. I'm not referring to the other benefits we have, no risk of hypotension, very low injection site reactions. This is why, and sure, obviously, patients, parents, parents, parents, parents really love the once-weekly profile. It's just a little burden for them to give it. I think what I see here, I'm not so much really concerned about exactly what is coming into the labeling.

I'm more interested in the benefit that we can go out and explain that TransCon CNP is providing, which I basically have never seen in any other well-controlled properly controlled trial. I think that is the key element for me. I think this is what we see everywhere. The second question was about the IP. I believe when we developed that in 2015, we basically filed a lot of IP. There was how to make an optimal product. There was the benefit of having a product that gave sustained things. As there is no clear for me exactly what is the BioMarin structure that they have in the BMN 333, it's impossible for me to say exactly what they are.

If you can see me, at least you can see I have a great smile on my face because we are pretty good in what we're doing when we file IP.

Understood. Thank you.

Speaker 0

Thank you for your question. Our next question comes from Joe Kelly from Jefferies. The floor is yours.

Congrats on another strong quarter. Thank you for taking my questions. For YORVIPATH, what is the typical titration period that you're seeing right now across the broader patient spectrum in the real world? Once the patient completes the titration period, should we expect a higher monthly cost? Thank you.

Speaker 3

At least I got the first question related to the titration period. I think Aimee, our Chief Medical Officer, knows a lot of what we have seen in our clinical trials. I think we are much more uncertain about what is exactly happening in what we call in real-life clinical elements. What the key element for me, and I take it from that perspective, is do we see a lot of patient unsatisfaction at that stage? Do we see a lot of patients drop out because there is a problem with it? We don't see that. I cannot really comment about what is exactly happening in the titration for the patient in the real world, but at least we can see that it's happening very successfully. Your second question was?

Once the patient completes titration, should we expect a higher monthly cost? Because they stay on a higher dose, right?

I think in the U.S., we have an approval up to from 6 to 30 micrograms. Basically, we are in a position that we're only using one pen at the time. Outside the U.S., they have a possibility to use up to 60 micrograms. We have just initiated what we call our 60-microgram trial, which will facilitate this is our aim. This is a 26-week trial to facilitate that we can get on labeling that we can use up to 60 micrograms in the U.S. I think when Jay has seen all the data and we're coming from what I call commercial launch of up to the 60 micrograms, there will be a discussion from Jay's side exactly how we are handling the reimbursement for that situation. I think it's too early for us to comment on that.

Thank you.

Speaker 0

Thank you for your question. Our next question comes from Paul Choi from Goldman Sachs. The line is yours.

Hi. Good afternoon. Congratulations on the strong quarter results. Jan, just to follow up on your last comment about potentially harmonizing the U.S. label with the EU label and the 60-microgram dose, when might you be in a position to submit that data to the FDA? Commercially, what portion of the patient population would that potentially allow you to address as not being currently suited by the available presentations in the U.S. market? Thank you for taking our questions.

Speaker 3

Thanks a lot for the question. I actually think this is a lot of questions in the question because what is happening in the U.S. today, and I think there are a lot of different places where different elements on how to solve the issue if a patient needs more than 30 micrograms. There are some patients because of the label restricting to 30 micrograms, they will stay in a position that they're taking 30 micrograms. If needed, they will potentially take additional calcium supplements or additional active vitamin D. There are other places where the basic patient on a physician off-label will potentially get access to a higher dose, which we obviously have no involvement in and no recommendation. From my perspective, it is that there is a need for a dose higher than 30.

We will do everything we can do to get it as fast as possible out to the patients. We are starting the trial now. It's a small trial. It's less than 20 patients. We are targeting enrollment of 18. It's only 26 weeks. We are utilizing the same pen devices that we basically have been already in the market. There is no CMC component in this way. It's just for Aimee Shu and all her people to basically get the clinical trial done and get through the regulatory team to get it filed and approved. We will do that as fast as possible. It looks pretty, pretty promising to get it in.

Speaker 0

Thank you for your question. Our next question comes from Alex Thompson from Stifel. The floor is yours.

Hey, great. Thanks for taking my questions. I guess on YORVIPATH as well, you've talked about the breadth of prescribers. I wonder if you could comment on the proportion of prescribers that you've seen with multiple prescriptions, multiple patients on therapy, and how you see that trend changing over time. Thanks.

Speaker 3

We cannot really address that question. We don't have sufficient data that we really will feel confident to come with data that really supports a strong trend analysis currently.

Speaker 0

Thank you for your question. Our next question comes from Luca Issi from RBC. The floor is yours.

Oh, great. Thanks so much, Sherrie, for taking my question and congrats on the quarter. Maybe Scott, lots of questions, obviously, in the top line, rightly so. How about SG&A? I mean, up 44% year over year and 6% quarter over quarter. I appreciate, obviously, you're launching a drug, but how should we think about modeling SG&A for the rest of the year? I guess what I'm trying to hear is how should we think about the potential to achieve profitability in Q3 versus Q4? Maybe secondarily, can you just remind us about Ascendis exposures around Caris and MSN? I appreciate the situation is still fluid and we don't have all the details, but any high-level commentary, much appreciated. Thanks again.

Speaker 2

Okay, great. On SG&A and expenses overall, remember last quarter we did the €190 million of OpEx, and we said that wasn't a bad run rate, maybe plus or minus each quarter. This quarter, we're minus about 10 from that, so we're about €180 million of OpEx this quarter. As you point out, it's probably not best to look year over year because we had a lot of growth in the last year. It's really in the sequential build. I would look at the 6% sequential growth for SG&A as potentially not a bad number to think about. In the overall context, I would still say about €190 million OpEx per quarter is not a bad number to think about. With respect to profitability, yes, we expect that this year.

If you look at our financials and back out June 30 currency, thanks to our, whatever it was called, liberation day, that cost about €20 million of cash delta. Overall, everything across the company, it was about €5 million of burn in Q2. Actually, on an operating basis, we're just slightly positive on cash. That should be relatively doable this year. With respect to MSN and tariff, I think you said it pretty well. There's really too much in development right now to make any comments specifically on it. We do believe that as a flexible company, we're pretty well positioned to mitigate the impact of any policy should it emerge.

Speaker 3

Just to clarify and also add in Scott's comments, we're not importing Finnish products to the U.S. We import them in different states and finalize them inside the U.S. In whatever way we look at it, we cannot see how it really should provide a major material impact on our business and how we operate.

Thank you so much.

Speaker 0

Thank you for your question. Our next question comes from Leland Gershell from Oppenheimer. The floor is yours.

Thank you. Good afternoon, and thanks for taking our questions. I'm just curious, in the past, you had not expressed much interest in hypochondroplasia as a development program. Maybe you had started to lean a bit toward that earlier this year. Now we're seeing a formal announcement of the intention to go in that direction. I'm just wondering what may have changed that affected your decision process here. If you could also maybe just share briefly what you think is the opportunity for Ascendis Pharma in hypochondroplasia. Thank you.

Speaker 3

Yeah, hypochondroplasia is what I will call, and perhaps it's the wrong way to define it, but I call it a milder form of achondroplasia. They don't have many of the same, what we call, body disproportionality. You can say some in old days, many of these patients basically will come in the ISS, your hepatic short status. Now, because of much more influence of genetic testing, you basically have a development large group that more is well-defined from genetic testing to be hypochondroplasia. It's one point that basically is saying a patient that was in one therapeutic group is now being moved over in a different therapeutic group, meaning they're moved from ISS over to hypochondroplasia. One thing.

The second thing is that when I saw the element of combination therapy with TransCon CNP and TransCon Growth Hormone, then even if you have a very much heterogeneous patient population, by having a combination product, you basically can ensure all of them will do extremely well. You can say that is what really is bringing up my attention why I believe we need to do it. Also, because I went out and talked with a lot of patients. I actually think I like to talk with the patient and the patient organization because talking with them, I get much more idea about the unmet medical need we need to address. Basically, this is the three pillars that have changed. I say a re-change of the therapeutic groups where the hypochondroplasia is growing because of allocation of patients from ISS over to hypochondroplasia.

They're a heterogeneous group that really, I feel, when I talk to the patients, when I talk to the patient organization, need a treatment. The extremely positive data we got for the first trial where when you have such a heterogeneous, some of the key elements will be the CNP. Growth Hormone will help. One CNP is the key element. CNP will help. This is why we.

Speaker 0

Have such a hesitant clinic group. Having the combination therapy will be the most realistic way to treat them in a way where you really will have a fundamental good treatment regime.

Speaker 2

Great, thank you for that, Aimee Shu.

Speaker 3

Thank you for your question. Our next question comes from the line of David Lebowitz from Citi. The floor is yours.

Speaker 2

Thank you very much for taking my question. Curious, has there been any evolution in your thinking on the ultimate size of the market for YORVIPATH? Curious to know.

Speaker 0

You know, I've always been bullish and said that it's going to be a $5 billion to $8 billion market segment. I have no doubt that it will be there.

Speaker 2

Thank you for taking my question.

Speaker 3

Thank you for your question. Our next question comes from Jay Wu from Cantor Fitzgerald. The floor is yours.

Hi, thanks very much for taking the questions. The first question on TransCon CNP for achondroplasia. Assume that you receive FDA approval by the PDUFA date. How quickly will you be able to launch the product? The second question on hypochondroplasia, and based on your comments just now, but the press release seems to be saying that either still either monotherapy or combination therapy. Is it still a possibility that you might end up going with a monotherapy for hypochondroplasia? If that's the case, then what would be the reason why you don't go with a combo therapy given the obvious benefit from code study?

Speaker 0

The first one is we actually made some kind of precision with SKYTROFA. We will wait until we get the approval and likely Scott will force me to wake up in the morning very, very, very early, so there will be a press release or some kind of call at 5:00 A.M. my time in the morning. I think at that time we will explain exactly when we have seen the labeling, got all the CMC information back from FDA and other places, when we will launch the product. Jay will also be forced to be up in the morning and he will explain how we're going to do our launch strategy in this way. You need to wait a little bit to this early morning call and we will try not to do it as Sunday, but we will try to take it every other day.

The second part is a little bit about what we talked about before. This hypochondroplasia in my view is an extremely heterogeneic population now with a lot of what I call burden in a different way. Also now with the reallocation of patients from the ISS group into the hypochondroplasia, it will some way, from my perspective, optimal will be to use the combination. We will continue our dialogue with our regulatory agencies around the world to be sure that they also have the aligned view. I cannot some way eliminate the discussion if we will have in the clinical trial a single arm also reflecting TransCon CNP as a monotherapy. It's our belief that the combination therapy will be what is best for the patients in this way. This is where we are for the time being. We believe that the combination is the most robust treatment on it.

Obviously, there will be some patients that also just will benefit of having TransCon CNP as a monotherapy.

Speaker 2

Thank you.

Speaker 3

Thank you for your question. Our final question comes from Maxwell Scar from Morgan Stanley. The floor is yours.

Great, thank you for squeezing me in and forgive me if this question's been asked. Given the magnitude of growth, velocity, improvement in the COACH trial, do you believe a single pivotal trial could be sufficient for approval of the combination? Have you received any preliminary feedback from the FDA or EMA? Thank you very much.

Speaker 0

Yeah. I had a lot of discussion with Aimee Shu about that. She's sitting on my side because when we started this trial, we talked about our own expectations. Now we're sitting with a growth velocity that is so unprecedented and never been seen in achondroplasia. They are basically growing faster than a normal child. I have four children and I remember when they have growth spurts. It was not really good. We're pretty tall. We're Scandinavian. You really grow a lot. You basically will be in a position that this is really a big change in that. In some way I see it, and we in some way go back and forward in that discussion. When you take a treatment of one year, when you take a treatment of two years in the combination, you will get major growth and other positive development.

When you then go back for one or two years, just have TransCon CNP as a monotherapy, and then you will boost again if there is desire from the parents for the child and for other things related to that and if it's really needed at that time. In some way, when I think about the overall way how we will do the best for the patient in the achondroplasias, it is basically to give them that option that we really can be in a position where they can take combination therapy likely for one year, potentially two years, and other things like that and get all the benefit in that kit. Then they can continue with our TransCon CNP. If they have a desire to move into another one yearly or two yearly treatment, they can do that again. That is more or less our thinking in this way.

Great, thank you very much.

Speaker 3

Thank you for your question. That does conclude the question and answer session portion of this meeting. This also concludes the meeting itself. I'd like to thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Speaker 2

Thanks so much. Thank you.