Ultragenyx Pharmaceutical Inc. Q3 FY2021 Earnings Call

Good afternoon. And welcome to the Ultragenyx Financial Results and Corporate Update Conference Call for the third quarter 2021. We have issued a press release detailing our financial results, which you can find on our website at ultragenyx.com. I would like to remind investors that this call will include forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, the types of statements identified as forward-looking in our 2020 annual report on Form 10-K that was filed on February 12, 2021. Our quarterly report on Form 10-Q that will be filed soon and our subsequent periodic reports filed with the SEC, which will all be available in the Investors section on our website. These forward-looking statements represent our views only as of the date of this call. And involve substantial risks and uncertainties, including many that are beyond our control. Please note the actual results could differ materially from those projected in any forward-looking statement. For a further description of the risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements as well as risks related to our business, see our periodic reports filed with the SEC. I'll now turn the call over to Emil.

Thanks, Josh. And good afternoon, everyone. I'll start off by highlighting our continued execution across Ultragenyx' broad portfolio of clinical and commercial assets. Since our last call, we made substantive progress on two of our most significant clinical programs focused on larger rare genetic diseases. The first of these is GTX-102, an antisense oligonucleotide that we are developing in partnership with GeneTx Biotherapeutics for Angelman syndrome. Over the last few months, we successfully concluded discussions with three regulatory agencies to get our Phase 1/2 study up and running again. The ex U.S. protocol initially dosed four patients with two monthly doses each before our data monitoring committee reviews available safety data. As previously guided, we anticipate providing a preliminary update on the study after this review, which is expected to be around year-end. A study will then continue to treat those first four patients with two more monthly doses and to enroll an additional eight patients. We plan to provide a more substantial readout from the study after day 128 for all 12 patients which is expected in mid-2022. Turning to the U.S., we expect to begin dosing patients under the revised protocol later this quarter. The dose in the U.S. is lower than ex U.S. but the patients are restricted to the younger, smaller four- to eight-year-old age group. Our experience with the first five patients previously treated suggests that younger, smaller patients can respond to treatment at this dose after drug loading with four repeated low doses over three months. For Wilson disease, we've also begun enrolling participants in the baseline evaluation phase of our pivotal study. UX701 is an AAV9 gene therapy of a specially designed copper transport that can restore normal copper metabolism and distribution. The design of our novel Phase 1/2/3 study in Wilson disease is notable because it enables a seamless transition from a traditional dose-finding Phase 1/2 study right into a pivotal study, which will save time. I will note that this is our fourth clinical-stage gene therapy program and our first targeting a more prevalent genetic disease. Camille will provide more information on this program and study later on in her section. Also of note is that the UX701 program for Wilson disease is our second program to use the Ultragenyx producer cell line or PCL gene therapy manufacturing system. Our PCL technology is a novel approach similar to vaccine manufacturing that is designed to yield a more productive and consistent AAV production process. The result is that we are manufacturing commercial grade material at commercial scale for the first clinical patients with a substantial reduction in costs compared with triple transfection processes. This process allows us to manufacture enough material to treat all the patients randomized to UX701 in the Phase 1/2 portion of the study with a single run significantly driving down COGS an important element when thinking about the potential reimbursement challenges in the future for gene therapy products. We are continuing to invest in our PCL system, most recently as part of our preclinical AAV program for Duchenne muscular dystrophy. We expect the greater productivity of the PCL system will be especially important for more common and higher dose indications like Duchenne, where the amount and cost of the product can be an important factor. Moving to the rest of our clinical pipeline. We are advancing four additional programs that further demonstrate the diversity of our portfolio across modalities. All four of these programs have new studies starting over the next few months. And three of these studies will be pivotal. Our gene therapy for DTX401 for GSDIa and DTX301 for OTC deficiency are both moving into Phase 3 studies based on durable positive Phase 1/2 results over multiple years of follow-up. We are also on track to initiate a pivotal Phase II/III study of our newest program, UX143. This monoclonal antibody will be tested in pediatric and adult patients with osteogenesis imperfecta, a larger rare genetic bone diseases that complements the capabilities we've developed with Crysvita. Wrapping up with our commercial programs. Despite the recent challenges with the COVID Delta variant, our team has continued to be effective at supporting compliance for patients already receiving our therapies as well as increasing new patient starts across all products. With Crysvita, the successful launch continues, and we are now tracking towards the upper end of our full year guidance. Adult patients are an increasing portion of patients we are identifying and converting to treatment. In Latin America, Crysvita continues to do especially well. Revenue in that region has more than doubled year-to-date in 2021 versus 2020. This growth is backed by increases across the board in patient identification, patients who have a prescription and are navigating the reimbursement process, and patients receiving reimbursed therapy. We are nearing the conclusion of the formal reimbursement process in Brazil for access to the product, which should help further growth there. With Dojolvi, we're continuing to build the momentum of a strong launch. All the key metrics show the teams are able to find patients and quickly get them on reimbursed therapy. We are near ten percent of the expected population of LC-FAOD patients now being prescribed Dojolvi in the first year or so of launch. Dojolvi is also growing in Europe, driven by significant increases in named patient requests in France and other countries in the region. Before I turn the call over to Erik, I want to highlight our recently announced collaboration with FDA, NIH and leading public and private organizations focused on gene therapy development. The bespoke Gene Therapy Consortium as part of the NIH Accelerating Medicines partnership program is focused on advancing gene therapies for ultra-rare diseases. At Ultragenyx, we believe we have the responsibility to support the development of treatments for as many rare diseases as possible, including these ultra-rares that might not otherwise get treated. We also believe that this joint collaboration will help identify ways to improve the development process and create a further improved regulatory paradigm to improve the efficiency and effectiveness of the development of the next generation of gene therapy for all rare diseases. With that, I'll turn the call now over to Erik.

Thank you, Emil. And good afternoon, everyone. The commercial and field teams continue to execute in the North and Latin American regions, despite the ongoing pandemic. This has led to another strong quarter, building on significant momentum that we generated in the first half of the year. In the press release we issued earlier today, we further highlighted this by guiding towards the upper end of the $180 million to $190 million range for 2021 Crysvita revenue in Ultragenyx territories. This would represent greater than a 35% year-over-year growth. Within the North American region, we continue to see steady underlying demand from both the pediatric and adult markets as the total number of prescribers surpassed 1,000. The split of the pediatric and adult patients remains approximately 50-50 while the total number of patients on therapy continues to increase. As Emil mentioned earlier, we expect this split will continue shifting towards a greater portion of adults on Crysvita as the teams continue to increase focus on finding doctors who have adult patients with XLH or TIL dispersed in the community setting. Compliance remains very high, in part because of the UltraCare patient support services team, and because patients who begin therapy recognize how much better they can feel when on Crysvita. Outside of the U.S., demand for Crysvita continues to gain momentum. Third quarter revenue in Latin America grew significantly versus the second quarter partly reflecting the uneven ordering patterns we expect within that region. However, if you compare the revenue of the first three quarters in 2021 versus the same time period in 2020, you can begin to see the significant opportunity ahead of us. Revenue over that time period grew approximately 115%, driven by increasing underlying demand. This is the result of all of the work the teams have been doing for the last couple of years to educate health care providers, find patients and work with regulatory and reimbursement authorities. We are in the final stages of negotiating full reimbursement with the Brazilian authorities. And in the meantime, continue to receive orders from the Ministry of Health to support patients who have been granted an injunction to receive this therapy. Turning now to Dojolvi, which was approved for the treatment of long-chain fatty acid oxidation disorders, or LC-FAOD, by the FDA in the middle of 2020 and by Health Canada earlier this year. In the third quarter, we added approximately 40 site points bringing the total since launch to approximately 310 site points. As of the end of the quarter, this has resulted in approximately 250 patients on reimbursed therapy. Approximately 145 unique health care providers have written a prescription for Dojolvi, and we are continuing to see growth in the number who have written multiple prescriptions. Much of the success we have seen in the first year of launch is driven by a couple of factors. First, the strong demand for Dojolvi at the major centers of bone metabolism. Second, our patient support services team is doing a great job, supporting patients and their families as they navigate the insurance process and work through any issues they might have in receiving Dojolvi. Over time, we believe demand with Dojolvi will continue to grow at a steady pace similar to other products in the space. Outside of the U.S., uptake of Dojolvi remains strong through our named patient and early access programs. In Europe, Dojolvi is growing driven by steady increases in named patient requests in France. We are continuing to work with regional regulators to gain full approval to treat all patients who could benefit from Dojolvi. In fact, the Brazilian National Health Surveillance Agency recently approved Dojolvi for the treatment of both pediatric and adult patients with LC-FAOD. As is typical within that country, we are now working with the Ministry of Finance to get full reimbursement approval. These are important steps forward as we seek to provide broad access to Dojolvi in the Latin American region. As the teams look to close out the year, we will continue to adapt to the ever-changing COVID landscape to ensure that patients can continue to benefit from our products. With that, I'll turn the call over to Mardi to share the financial results.

Thanks, Erik. We issued a press release earlier today that included a financial update, which I will briefly summarize. Company revenue for the quarter ending September 30, 2021, totaled $81.6 million. Crysvita revenue in Ultragenyx territories grew to $50.3 million, including $43 million from the North American profit share territory and net product sales of $7.4 million in other regions. Total royalty revenue related to the sales of Crysvita in the European territory was $4.7 million. Dojolvi revenue for the quarter was $10.7 million. As we have stated before, we will not be providing guidance for Dojolvi in these first quarters of launch. We believe the metrics Erik just discussed better describe the success we are seeing so far. Mepsevii revenue for the third quarter of 2021 was $3.9 million. And we expect these revenues may modestly increase over time. Third quarter 2021 revenue also includes $12.1 million related to the tech transfer as part of our strategic manufacturing partnership with Daiichi Sankyo around our PCL and HEK293 technologies. As we have discussed previously in the fourth quarter of 2021, the revenue we recognized from this agreement will taper significantly as the tech transfer activities wind down as planned. Additional details on this revenue recognition can be found in our annual and quarterly reports filed with the SEC. Total operating expenses for the quarter were $171.5 million, which includes research and development expenses of $113.4 million, SG&A expenses of $53.9 million and cost of sales of $4.2 million. We continue to expect our R&D cost to increase in 2021 compared to 2020 as we support three pivotal gene therapy clinical trials, the UX143 Phase 2/3 clinical study in osteogenesis imperfecta and the Phase 1/2 study for our most advanced mRNA program, UX053 and GSDIII, and a number of other preclinical activities as we get ready to advance the next programs into the clinic. We also expect SG&A to modestly increase in 2021 as we continue to support the expansion of the launches of Crysvita, Dojolvi, and Mepsevii. For the quarter ended September 30, 2021, net loss was $73 million or $1.08 per share. This compares to a net loss for the same period in 2020 of $68.8 million or $1.13 per share. The net loss for the third quarter of 2021 includes a $25.7 million increase in the fair value of investments in equity securities as compared to an $11.5 million decrease in Q3 2020. Net cash used in operations for the nine months ended September 30, 2021, was $284.4 million compared to $69.8 million for the same period in 2020. Net cash used in the nine months ended September 30, 2021, includes the $50 million upfront payment for the closing of the Mereo license and collaboration agreement, compared to the net cash used in the same period of 2020 that included $154 million of operating cash received from Daiichi Sankyo related to the collaboration and license agreements. We have ended the third quarter with approximately $941 million in cash, cash equivalents, and marketable securities. This puts us in a strong capital position to reach key clinical and commercial milestones as we continue executing our development and commercial strategies. So now I'll let Camille touch on some of our clinical programs.

Thank you, Mardi. And I too wish everyone a good afternoon. Before I share updates from our ongoing clinical programs, I'd like to review new data presented last month at the International Network for Fatty Acid Oxidation Research and Management, or INFORM 2021 virtual conference. The results represent data over a longer period of time and on additional patients and an independent group of patients with long-chain fatty acid oxidation disorders, LC-FAOD, treated with Dojolvi in an extension study. There was a statistically significant reduction in annualized major clinical events, or MCEs, and annualized duration of these events for 33 patients who had not previously received treatment with Dojolvi when comparing the 18 months prior to treatment to the median 21.9 months on therapy. In these patients, the median annualized rate of MCEs went from 2.00 to 0.28 per year or an 86% reduction, p-value 0.0343 and the median annualized duration of MCEs went from 8.66 to 0.8 days or a 91% reduction p-value 0.0325. These data are consistent with the previous published results. Next, I'll shift to GTX-102, the antisense oligonucleotide, ASO, that we are developing in partnership with GeneTx for the treatment of Angelman syndrome. Angelman is a severe neurogenetic disorder that affects approximately 60,000 patients in the developed world. We with our partner GeneTx, are currently enrolling the Phase 1/2 study in Canada and the UK. Dosing at the Canadian site has already begun with the UK to follow shortly. As a reminder initially two patients in the under eight-year-old and two in the over eight-year-old cohorts will be enrolled. Following each patient's second monthly dose and the completion of a two-week follow-up period, a data monitoring committee will review the available safety data to determine if they recommend moving forward with enrolling the remaining four patients in each age cohort. Following extensive discussions with the FDA, we were able to reach an agreement on a modified protocol that will allow us to dose naive patients, younger than eight years old, in the United States. The revised protocol will enroll eight patients split between a GTX-102 treatment arm and a comparator group with the active group receiving two milligrams monthly doses for four months. The comparator group can then eventually enter the same dosing regimen. Because the dose level is lower in the U.S. protocol we have narrowed enrollment to the younger age patient group of four to eight years old. The site in the U.S. has a number of patients identified who are all eager to participate in the study. We expect dosing to begin later this quarter. I'll now turn to our three pivotal gene therapy programs, starting with UX701 for the treatment of Wilson disease. Wilson disease is a rare genetic disorder of copper metabolism due to a mutation in the ATP7B or copper transporter gene. This results in the accumulation of copper in the liver and brain, particularly a potentially progressive serious disease. We estimate there are approximately 50,000 patients in the developed world who have Wilson disease. Last month, we announced that we have successfully screened the first patient in the seamless Phase 1/2/3 study that aims to directly address the mutated ATP7B gene. These patients are now in a six- to twelve-week baseline evaluation period where they will be evaluated to ensure stable measures of disease such as 24-hour urinary copper concentration, complete blood count, and liver function tests. Following this baseline screening period, patients will be randomized and treated with UX701 or placebo. Next, DTX401 for the treatment of glycogen storage disease type 1a, or GSD1a, is a disease that arises from a defect in the glucose 6-phosphatase, or G6Pase enzyme, which is essential to the liver's ability to release glucose to the bloodstream and its deficiency leads to serious hypoglycemia. GSDIa is the most common genetically inherited glycogen storage disease with an estimated 6,000 patients in the developed world. We have a number of sites already activated and expect the first patients from the U.S. and Canadian sites to enter the four to eight-week baseline evaluation period around the end of the year. During this period, patients will be monitored to establish four consecutive weeks of clinically stable disease through the use of a controlled diet, oral glucose replacement therapy, and a continuous glucose monitoring. Following this baseline evaluation period, patients will be randomized and treated with either DTX401 or placebo. Our third pivotal gene therapy is DTX301 for the treatment of ornithine transcarbamylase or OTC deficiency. OTC is a critical component of the urea cycle that metabolizes toxic ammonia into urea that can then be safely excreted in the urine. Ammonia is a very potent neurotoxic compound and can lead to coma, serious brain injury, and death. There are approximately 10,000 patients in the developed world with 80% being late onset. We currently expect the first patients to enter the four- to eight-week baseline evaluation period around the end of the year. During this period, patients will be monitored to establish four weeks of clinically and metabolically stable disease through a protein-restricted diet and/or the use of ammonia scavengers. Following this baseline evaluation period, patients will be randomized and treated with either DTX301 or placebo. The last program I will touch on is UX143 for the treatment of osteogenesis imperfecta or OI. OI is a large genetic bone disorder with approximately 60,000 patients in the developed world. Most of our XLH doctors have many more patients with OI than XLH. These patients have reduced or abnormal collagen that triggers a maladaptive bone remodeling response. The body recognizes the defective collagen and breaks down bone in a repeated cycling attempt to fix the issue. However, patients with OI are unable to create normal collagen. And that then leads to over-absorption and inadequate net production of bone. And the bone weakness creates the risk for fractures. What we have found in animal models is that if you stimulate the production of more bone with anti-sclerostin or other agents, you can improve the bone strength to normal or near normal even while the collagen is still mutated. This would suggest that the fragility of the bone is not due to the collagen, but is actually the body's maladaptive response to this defect. UX143 or setrusumab, is a fully human anti-sclerostin monoclonal antibody that should help the body correct this imbalance by stimulating bone production and suppressing bone resorption, restoring the net balance to our bone production. Mereo's ASTEROID study showed a dose-dependent increase in P1NP and a decrease in CTx serum levels supporting this hypothesis. There were also continuous improvements in bone mineral density over the 12-month treatment period of the study, including an 8% to 10% improvement in the spinal column, which is a better anabolic result than other commonly used bone anabolic agents. The pivotal 2/3 study we expect to initiate later this year, will study pediatric and young adult patients ranging from five to twenty-five years old with and without a history of prior bisphosphonate treatment. The first part of the study will enroll approximately 40 patients and will evaluate a few doses compared to placebo. Once the dose is identified, the study will enroll additional patients at the optimal dose level. We will provide more details on the study design and endpoints when we initiate the study later this year. With this update, I will now turn back the call to Emil. Thank you.

Thank you, Camille. Before we close out, I would like to provide a quick reminder of the key upcoming milestones for the company. For GTX-102 in Angelman syndrome, we've dosed patients in Canada. We'll dose patients in the UK and U.S. later this quarter. And we plan to provide a preliminary update on this program around the end of the year. For our gene therapy pipeline, we continue enrolling the UX701 Phase 1/2/3 study for Wilson. We'll share a longer-term follow-up Phase I/II data at the ICIEM from the studies of DTX401 in GSDI and DTX301 in OTC. We will initiate Phase 3 studies in both these programs around the end of 2021. For UX143 in osteogenesis imperfecta, we'll initiate the pivotal Phase 2/3 study in pediatric patients around the end of the year with studies and other age groups anticipated to begin next year. As you can see, our clinical pipeline is one of the largest and most diverse in the rare disease space and targets a number of genetic diseases with significant unmet need. With four pivotal studies enrolling in early 2022, and the Angelman program back up and running, we look forward to updating you on our progress. With that, let's move on to your questions. Operator, please provide the Q&A instructions.

And our first question comes from the line of Tazeen Ahmad from Bank of America.

Thank you, guys. Good evening. And thanks for taking my questions. Two quick ones, Emil. For the gene therapy for DMD, where do you think there is the most room to differentiate from what potentially could be in the market? So for example, the latest update, it seems like Sarepta and Pfizer are now both expecting their Phase 3 data for their programs in the early part of 2023. Obviously, we don't know what they would look like. But let's say that they're built on the market before your program, where do you see the biggest opportunity there? And then quickly for the 701 program are you able to tell us what you expect the screen-out rate to be for the AAV9 antibodies with patients that you're looking to enroll into the study? Thanks.

Sure. So look, on the DMD program, we know when we started, we're well behind the two program leaders, Sarepta and Pfizer. And so our goal is to come up with a better combination microdystrophin vector along with the manufacturing process we think will be superior. And to do some other improvements related to how we administer the drug which we think can enhance the delivery. So the combination of factors, I think, will help us provide an improvement. Our ability to look at development and improve the quality of the development strategy and endpoints and evaluations, I think are another factor. We think all the micro work, and I think there's room for further improvement and we have that opportunity as a fast follower. But we're well behind, and we have a lot of work cut out for us. So we appreciate both companies or the other companies are very capable. But we do think we have some angles on how to be superior to the other Duchenne programs. With regard to AAV9 for 701, we haven't put out any information on the frequency. But we don't expect it to be an important issue with regard to being able to enroll the study and execute. And so far, multiple patients have qualified, so we haven't seen an issue.

And your next is question from Yaron Werber from Cowen.

Congrats everybody on all really great progress. Just really quickly on the gene therapy stuff as well. So I know in Wilson just got up and running; would we maybe be able to expect any maybe preliminary updates from the Phase 1/2 next year? And if so, maybe when you're thinking that could be. And then just for - on GSD1a and OTC, it seems like you're expecting to start dosing patients probably realistically early next year now. So I just wanted to see if there's maybe anything of note that's kind of limited getting these up and running, or rate of enrollment or anything like that, that we should be aware of. Thanks so much.

Sure. So for the Phase 1/2 Wilson data, we expect by late in the year, we should have enough data on the Phase 1/2 that segment of the program to be able to talk about it. But we can't yet commit to exact timing of that data, but that's what we're expecting. And the Phase 1/2 data would be separately analyzed from the Phase 2, which gives us a little bit more room to maneuver with regard to disclosing what we find. But we expect we should know the dose and have information about it by late in the year next year. We expect it to enroll fairly promptly for Wilson. So there are a lot of patients we think our program is an attractive one for patients. And we've managed to work to make it as convenient as possible so we could enhance enrollment. With regard to OTC, we made the decision that GSDI and Wilson were able to get going quicker. The challenge with OTCs is we had some work we had to do with the agency regarding the ureagenesis test and the involvement of the device division that FDA, the CDRH on that which led to some more conversations, which just took more time to get through. And right now, I would say CBR and CRH are both strapped and overextended; it took more time than we would have liked. So that's the main thing. It's really getting up and running. We've been doing patient diagnosis for all of our programs with our global team have lined up a lot of patients that we know are out there. So at least we believe we should be able to help improve the actual enrollment process once we get started. But it took a little longer to get through some of the regulatory steps for OTC. That is behind us now, and we're ready to get going, but there is still - that's the one main difference for OTC.

Your next question is from Maury Raycroft of Jefferies.

Hi, everyone. Congrats on the progress. And thanks for taking my question. I was just going to check in on Angelman for the preliminary data for the four patients around year-end. Can you set expectations on what we should be focused on, how much follow-up we should expect? And will there be enough total drug administered to see some efficacy and determine if safety has improved?

Yes. I think the main thing you'll see is that we'll talk about patients dosed and what we're looking at with regard to safety at that time. It's a little bit early on in the time course to know what the loading would be. And there was a run-in period where these patients were started, and that pushed out the amount of data we'll get. But it will be a good update on where we are with regard to any safety issues and where we go. So it will give us a sense that everything is progressing, I think, but it will take - we won't have a lot of efficacy information at that point in time because it's a bit early. What we are guiding to though is that the 12 patients of full data coming midyear is really kind of the place where you get a real full feel for loading six young and six old patients maximally titrating. And well, I think that will be the best assessment. Anyway, so far it's going well, and we're pleased to get going.

Got it. And as a quick follow-up, will you provide an update on enrollment status at the year-end update on where you're at with the total of 12 patients?

Yes. We'll talk about where we're at on the status of the program at that time. Yes.

And your next question is from Joseph Schwartz of SVB Leerink. Your line is open.

I'm for Joe. Thanks for taking our question. The first one is on Angelman. Is there any more work you can do to help the FDA get comfortable with the risk benefit of dosing additional Angelman patients at a higher dose?

Well, I think the FDA is being conservative with regard to the sense of safety. And I think the thing that's going to help them is getting more data on the higher doses ex-U.S. and comfort with the administration strategy. We have confidence in it. But for them, there's not much benefit in taking any risk. So we're able to get started at two, which will give us some information since we restricted because of that dose to be the young patients where the milligrams of loaded drug should be significant enough to give an effect based on what we saw before. But we think that the dose ex U.S. is going to give us the safety and efficacy information, which we would use to revise the U.S. program eventually in this coming year. So I think clinical data is what's going to move the needle for FDA at this point. And that's on track to get it.

Okay. Great. And I guess as a follow-on to that, you kind of touched upon it. But I guess, to what extent do you think that the FDA will consider learnings from your ongoing UK and Canada study where you'll be able to do higher look. Have you had any conversations with the FDA about this?

Well, I've done a lot of regulatory interactions. One of the things I know that doesn't really work that well to ask some hypothetical questions because they won't commit to anything. So you can't say if they all look good, will you do this? They just say, let's see what that says. I just - it's not really a productive thing to ask them. So - but I know from history, I've done on four other programs. I've gone ex-U.S., obtained more data on safety and efficacy, come back to the U.S., got their agreement and got those products approved, right? So I've done it four times before. I think that's probably enough evidence that, that strategy can work.

Okay. Great. That's very helpful. And then my second question is on the Wilson program. I believe that the DTX701 has an inducible promoter. Curious to know how it works and have you learned anything from your experience with DTX401, which also has this feature, although it's likely different and there still needs to be patients for - and they are needed to be patients' blood glucose to equilibrate over time. Do you foresee the need for any equilibrating amongst Wilson patients? Or do you expect that they will achieve homeostasis right away to get the dose right?

Well, we're depending on the dose to get to the right level, and there isn't an inducible feature in 701 that I'm aware of. The 401, it's not just inducible. It's more of a regulation that is - the 401 promoter includes all the normal signaling elements that you require to control your glucose correctly for insulin and glucagon and cortisol and other things. So that our transgene for collection store disease will respond to your body's signals, which I think is extremely important in managing glucose correctly. You want a system that responds for the metal ion; I don't think there is actually a particular need. As long as you're getting enough metal transport, excess will not harm you. Basically, your body already regulates whether it's sending the copper to the bile or whether it's going to the Golgi. If the Golgi is how you make reals, if you need - if you have excess, it ends up going to the bile. And so how much transport is present is not as I think as critical as it might be in glucose regulation.

And your next question is from Gena Wang of Barclays.

Thank you for taking my questions. I also have two short questions regarding Angelman. So Emil, I'm just wondering, how did the FDA pick the 2-milligram dose? What was the thought process or data to support that? And then the second question is just wanted to confirm for the year-end update. Will we see full patient data with each having three doses or two doses? And then quickly, I think you commented a little bit. Just wondering what kind of safety data in terms of, say, follow-up or dose that from ex-U.S., do you think it will allow you to do higher in the U.S.?

Okay. So the 2-milligram dose is basically a level that's one-tenth the dose at which we saw in one patient, a safety problem. Remember, Patient 5 had the safety problem at 20 mg and they wanted a more dose one-tenth of that dose; that's the basis for that choice at 2 mgs. I don't really think that 2 to 3.3 is a big difference, but they prefer to stay a full 10x below. We decided just tactically not to try to titrate. They didn't tell us not to, but we just decided not to even push it because we were going to get what we needed ex-U.S., and it felt it more important just to get started and treating some patients. And we restricted it to the young patients because we thought we had a better chance of seeing efficacy in that group. And the idea is we would have a group of patients now, four patients that would run at 2 mg and we'll have ex-U.S. patients. So 2 mgs that get about a total of eight. And the ex-U.S. patients will get around 16.6 mg. So we'll actually essentially have like an equivalent of sort of half of the dose cohort. So if you look at the totality of this, it will give us a potential for looking at dose response, combining U.S. and ex-U.S. data. So there is a plus side to it, and we think it's just about getting started in the U.S. The FDA just wants to be conservative and protect patients, and we're willing to work with them and get through that and get on to the next step. And we're comfortable with the dose administration change we're making and how we're managing those ex-U.S. will be successful, and therefore, we'll be able to bring that to the U.S. The end of the year update, we've been - we will have some safety data and through the first 2 to 3 doses. But I think right now, it won't - it's not going to be a very complete update. It will be some dosing; you'll get a sense that whether patients are having the symptoms, but we want to be able to fully load the patients. We had hoped to have more like 3 to 4 doses, but it's more like 2 to 3. And the update, I think, will give people - should - if we're showing safety, then we'll at least understand that we can dose at this level and not get the problem and to get loaded to efficacy though we think you need several doses in order to get there. So the efficacy will be - will provide what we have, but it will be more important to think - look forward to the full data set on 12 patients midyear, which will be I think a truly substantial amount of information on what's going on with that loading and doses that we are proposing. Last item, you said safety data ex-U.S. I think the type of safety will be able to show them is that we're not seeing the exacerbation of protein into the CSF that we had seen. And the fact that we're not seeing lower extremity weakness, both clinically as well as using the neurological assessments. And of course, if we saw a problem, we would do an MRI scan. But assuming we haven't seen anything, it’s the combination of the laboratory and clinical findings that we'll be able to use in terms of justifying what we would do in the U.S. But we'd expect to take the data from the majority of patients in the U.S. And after we've gotten our four doses loaded in those U.S. patients to put that package together come back to FDA in order for the next cohort that we would initiate to begin at a dosing plan that would be more optimal for achieving efficacy.

And the next question is from Cory Kasimov of JPMorgan.

Great. This is Thomas on for Cory. Thanks for taking the question. I guess maybe just a quick one on setrusumab or UX143, I know you guys haven't laid out this whole design of the Phase 2/3 study there, but curious if you can just comment on what specifically you'll be looking for in the Phase 2 portion to make a decision on a go-forward dose? And then also curious if we should be expecting a data update from the Phase 2 portion of that site specifically? Thank you.

Sure. So the Phase 2 portion will focus on P1NP, which is the synthetic peptides that are released when your body is making collagen and laying down new bone. So it's the early sign of new bone creation. And we'll rely on that. We have seen it before, and it provided a dose response. We'll be looking at 20 and a higher dose. And what we're trying to do is figure out for the children whether a higher dose might work better. And so it's not only just - it's not which dose. It's the dose range and age for dosing that we'll figure out. We'll use a couple of doses in the first group of patients that are in the Phase 1/2 - Phase 3/2 part to make the decision and then define a dosing algorithm for children up to adults that we would use then in the pivotal study. We know the 20 mg per kilo dose provides a substantial improvement in bone moral density already in hand. So we have a strong anchor for what's an effective dose. So it's just about making sure we do the best we can for the children and that we optimize and ensure that there isn't more efficacy that we would have missed out on by not increasing the dose, either for children or adolescents or older patients. So that's the basic idea. With that, we'll move into the rolling of the Phase 3 patients and at the - using the dosing algorithm defined.

Next question is from Salveen Richter of Goldman Sachs.

Hey, good evening. Thank you for taking our questions. This is Elizabeth on for Salveen. Just wanted to ask, and I could have missed it. But are you looking to start redosing patients that were originally treated in the Angelman's program? And I guess, when could that happen?

We have not reached agreement on redosing those patients. The agency wants us to treat these other patients and do a little more work to figure out whether we can demonstrate it's safe to redose those patients. We believe it's safe. The problems have resolved fully. And we do not think there is any immunological type basis for what's going on. But right now, we have not achieved a plan to redose those five patients, but we will work on that. But our first step, we think, is getting patients dosed and treated safely. With that in hand, then you can also go back and talk about redosing those initial patients. They're anxious to get started, but we have to work through this first step of treating some naive patients before we can make that move.

Hi. Thank you very much for taking questions. Congrats on the progress. I just had a quick one on Angelman. Could you tell us what the volume of the 2-milligram doses? And have you ruled out that injection volume was playing a role in the muscle weakness observed? And assuming it's not volume-related, was this perhaps a sequel-dependent effect based on the UBE3A sequence or just the result of any antisense oligonucleotide present in the CNS?

Yes. So volume is not really a factor. We've been using 10 CCs. In some cases, they got more 15 CCs but it really didn't relate to the volume of the artificial CSF being used. So we don't think volume is a factor at all. We do think though that in these patients, if they were - since they were relatively active patients, they would lay down and stand up quickly, that their drug tended to settle down the bottom of their cord, which we think was probably a factor in incubating their nerve roots and a much higher concentration of drug. Now we don't think it's sequence-specific. Everything we've done would suggest it's not - we think it's a high concentration effect. Even with sequence-specific, we would have seen the phenomenon up and down the spinal cord because the clinical effect happening in the brain demonstrates the sequences there. But yes, we don't see the problem. The drug and the oligo was originally heavily screened for sequence-dependent effects and screened negative and toxicologically was negative. So we don't think it's a sequence-specific effect at all. I think it's non-specific. And at this point, my best sense is that this is more of a chemical irritation effect of the oligo present at high concentrations in kids that don't lay down. In the UK and Canada now we're sedating them longer, keeping them laying down in Trendelenburg and to make sure the drug is moving forward. We're also adding a flush as just to keep the drug moving and make sure it mixes rather than settling in at the bottom of their spine. So that's what we think at the moment, and we don't think it's sequence or volume dependent.

And that does conclude our Q&A session. I would now like to turn it back to Joshua Higa for final remarks.

Thank you. This concludes today's call. If there are any additional questions, please contact us by phone or at ir@ultragenyx.com. Thank you for joining us.