Ascendis Pharma(ASND) - 2024 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - In Q2 2024, SKYTROFA volume more than doubled compared to Q2 2023, but reported revenue decreased by 27% year-over-year to EUR 26.2 million due to higher sales deductions and adjustments to prior sales accruals [22][24] - Total revenue for Q2 2024 was EUR 36 million, including EUR 4.6 million from services and license revenue [24] - R&D costs decreased by 21% to EUR 83.5 million in Q2 2024 compared to EUR 105 million in Q2 2023, while SG&A expenses increased to EUR 74.3 million from EUR 70.3 million [25] - Net finance income increased to EUR 29.4 million in Q2 2024 from EUR 26.4 million in Q2 2023 [26] Business Line Data and Key Metrics Changes - YORVIPATH revenue for Q2 2024 was EUR 5.2 million, reflecting the first full quarter of commercial revenue in Germany and Austria, up from EUR 1.5 million in Q1 2024 [24] - SKYTROFA revenue for the first half of 2024 totaled EUR 91.2 million, a 35% year-over-year increase compared to EUR 67.4 million in the same period in 2023 [23] - The number of patients on YORVIPATH treatment in Germany and Austria increased to over 250, with a retention rate of 98% [14][42] Market Data and Key Metrics Changes - The US growth hormone market is estimated to be around $1.4 billion, with SKYTROFA positioned as a premium product with a net value per patient approximately three times that of daily growth hormone [30] - By the end of Q2 2024, SKYTROFA penetration in the US pediatric growth hormone deficiency treated patient population was 18% [23] Company Strategy and Development Direction - The company aims to achieve approval for all three endocrinology rare disease product candidates by the end of 2025, with a focus on expanding into larger therapeutic areas such as oncology and obesity [10][11] - The strategy for SKYTROFA includes simplifying market access and expanding the product label to include adult growth hormone deficiency [15][17] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about the transformative impact of YORVIPATH for patients with hypoparathyroidism and highlighted the strong retention rates for the product [21][42] - The company expects to achieve operating cash flow breakeven on a quarterly basis in 2024 or 2025, depending on the launch timing of YORVIPATH in the US [27] Other Important Information - The company announced a new capped synthetic royalty funding agreement with Royalty Pharma for $150 million in exchange for a 3% royalty on net sales of YORVIPATH in the US [26] - The company plans to submit a supplemental BLA for adult growth hormone deficiency for SKYTROFA in Q3 2024 [17] Q&A Session Summary Question: How does the company project getting SKYTROFA to a blockbuster in the US? - Management indicated that the US growth hormone market is about $1.4 billion and SKYTROFA has a net value per patient three times that of daily growth hormone, with plans for label expansion [30][31] Question: What are the competitive dynamics regarding SKYTROFA's pricing? - Management acknowledged that there are two other long-acting products in the US market but emphasized SKYTROFA's best-in-class potential and strong market position [34][35] Question: What feedback has been received from payers regarding YORVIPATH pricing? - Management reported no negative feedback on the responsible pricing strategy for YORVIPATH, which aims to support all patients with hypoparathyroidism [39] Question: How is the penetration of YORVIPATH tracking in Germany and Austria? - Management noted that the uptake is strong, with around 125 prescribers and a retention rate of 98%, indicating a positive trajectory for the product [41][42] Question: What assumptions led to the lower guidance for SKYTROFA? - Management explained that the guidance was based on observed growth in volume and the reset of market access, with expectations for continued growth in the second half of the year [48][50] Question: What is the expected run rate for SKYTROFA moving into Q3? - Management indicated that the reported net sales for Q2, adjusted for true-ups, would provide a good basis for expectations in Q3 and Q4 [81]