California based biotech Ultragenyx Pharmaceutical Inc (NASDAQ:RARE) had a pretty tough start to the second quarter. The company logged mid March highs of more than $88 a piece, but by April 11, was going for a little of $57 a piece. That’s a 35% discount in the space of a few weeks.
This week, however, Ultragenyx (and by proxy, its shareholders) have picked up something of a reprieve. It’s not negated the discount, but a bit of news has boosted the company’s price per share to a little over $71 (in after hours trading) from the Tuesday open of $60. A close to 20% run on the news, then, makes it well worth a look.
So, with this in mind, here’s what happened, and what it means for the company going forward.
The news relates to a development asset called burosumab, and the company is investigating it as a potential therapy in a condition called X-linked hypophosphatemia (XLH). XLH might be a pretty unfamiliar term to many, but it’s also called X-linked dominant hypophosphatemic rickets, which might make things a little clearer for the non medical of us. Basically, when a person has low levels of phosphorous in their blood, it causes the problems generally associated with rickets – none paid, skeletal abnormalities, osteoarthritis, etc. In a standard rickets presentation, the introduction of phosphorous through IV, or tablets, or another method, can help top up the levels in the blood and – to some extent, at least – help to alleviate the symptoms of the condition. In this type, however, the disease is caused by a genetic malfunction that means the standard SOC doesn’t really work. We won’t go into the science in too much detail, but basically, there’s a gene that creates a protein, which regulates what’s called fibroblast growth factor 23 (FGF23). FGF23 is inhibits reabsorption of phosphorous in the kidneys, and in turn, stops the phosphorous passing back in to the blood for general circulation purposes. In patients with XLH, the gene that codes for the protein that regulates FGF23 is faulty, so the protein is ineffective, and the FGF23 isn’t regulated effectively. This means too much reabsorption inhibition takes place, and so the phosphorous doesn’t get reabsorbed.
The issue with this, then, is that however much phosphorous a patient receives as part of traditional SOC therapy, very little of it actually stays in the blood as it passes straight through the kidneys and out as waste.
Burosumab is an attempt to provide an effective alternative to SOC. It inhibits FGF23, and in doing so, allows for theoretically) an increase degree of reabsorption.
So that’s what the latest data looked at.
It’s a phase III and it was being carried out in collaboration with Kyowa Hakko Kirin Co. The trial set out to compare the drug to placebo across a 24-week period. The data, to put it bluntly, was excellent.
Patients treated with burosumab demonstrated a statistically significant improvement in serum phosphorus levels, with 94% of patients achieving normal levels compared to 8% on placebo. Further, and as relevant to a number of secondary endpoints, patients treated with burosumab also achieved a statistically significant improvement in stiffness and strong trends in improvements in physical function and pain.
Safety concerns didn’t arise that were outside of those expected, and this pretty much paints the drug as a shoo in for approval as and when it comes in front of the regulatory authorities in the target regions – specifically, and initially, the US and Europe.
So, what’s next?
The drug is going to stay under investigation as part of an extension study in this same population. That is, patients that took part in this study will (voluntarily) remain on study, and the company will follow up on the efficacy (and primarily, safety) of the dosing regimen on a longer term basis.
While this extension carries out, management has stated that it’s going to kick off discussions with the above mentioned regulatory authorities, and so we’re looking for any update as to how these discussions are progressing (and in turn, their potential outcome) as the next major catalyst.