Ultragenyx Pharmaceutical Inc (RARE) 2020 Q2 法說會逐字稿

Ladies and gentlemen, thank you for standing by, and welcome to the Ultragenyx Second Quarter of 2020 Financial Results and Corporate Update Conference Call. (Operator Instructions)

And without further ado, I would like to hand the conference over to Mr. Joshua Higa. Thank you. Please go ahead, sir.

Good afternoon, and welcome to the Ultragenyx Financial Results and Corporate Update Conference Call for the Second Quarter 2020. We have issued a press release detailing our financial results, which you can find on our website at ultragenyx.com. I am Joshua Higa, Director of Investor Relations. Joining me on this call are Emil Kakkis, Chief Executive Officer and President; Shalini Sharp, Chief Financial Officer; Camille Bedrosian, Chief Medical Officer; and Erik Harris, Chief Commercial Officer.

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 2019 annual report on Form 10-K that was filed on February 14, 2020, 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 on our website in the Investors section. 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 will now turn the call over to Emil.

Good afternoon, and thank you, everyone, for joining us on today's call. I'll start with our -- our call with a general update on our progress, and then turn it over to Erik, Shalini and Camille to provide more detailed updates on their respective areas.

Second quarter was highly productive for Ultragenyx. In the span of just 2 weeks in June, we received our third and fourth FDA approval in our first 10 years as a company. The first was Crysvita for tumor-induced osteomalacia, or TIO, which is now the second indication of the product after its approval for XLH in 2018. The second was Dojolvi for long-chain fatty acid oxidation defect or LC-FAOD, a group of 6 distinct inborn errors of metabolism. These are the first approved treatments for either of these debilitating diseases. In both cases, we were able to secure full FDA approval based on our Phase II study, supplemented by data from expanded access programs. This significantly reduced the time to develop for these therapies for patients with no other FDA options.

Our established approved products continued to perform well, Crysvita in XLH, and Mepsevii continued to grow as we enter the third year post approval. We've developed a great team and strong relationships in both medical genetics and in endocrinology fields with these earlier launches, and this will enable efficient launches in both TIO and LC-FAOD, despite some expected impact from COVID-19.

Moving to our gene therapy platform and programs. There have been significant recent clinical data updates for all 3 programs. At ASGCT, we presented data on both our GSDIa and OTC deficiency program. For GSDIa, all patients across all 3 cohorts in the Phase I/II study have responded to DTX401 gene therapy with the patients in the latest cohort more rapidly tapering their use of cornstarch and oral glucose replacement therapy that is enabled now by the expression of the transgene in our vector.

For OTC, we've now confirmed that 6 out of 9 patients in the study are responders to DTX301 gene therapy, including all 3 of the patients in the highest dose cohort. These updates further solidify our confidence in both programs as Phase III planning continues.

The third gene therapy update was for hemophilia A program led by our partner, Bayer. The [PI] on the ongoing Phase I/II presented data at ISTH on the third cohort from the study. As with prior cohorts, these latest data show sustained and clinically meaningful Factor VIII increases competitive with other hem A program and a near complete reduction in spontaneous bleeds. As a reminder, the Bayer program is our first partner gene therapy program and first-to-use material from our large-scale HeLa producer cell line system.

In the first quarter of this year, we initiated a gene therapy platform partnership with Daiichi Sankyo, in which they have nonexclusive access to our HeLa and HEK293 manufacturing system. Technology transfer related to that license has since been initiated, and we will receive $25 million in milestone payments when it is complete.

So with multiple collaborations in place, 3 products demonstrating positive clinical results, our gene therapy platform is on very solid footing as a source of multiple potential treatments.

I'll now turn the call over to Erik to go into more detail on the launches of Dojolvi in LC-FAOD and Crysvita in TIO as well as progress with our other commercial programs.

Thank you, Emil. I will start with recapping our launch plans for Dojolvi then cover Crysvita. As you saw last week, Dojolvi is now commercially available to U.S. patients with LC-FAOD. Dojolvi is the first approved therapy for LC-FAOD, which is a severe, lifelong and life-threatening disease. We have initiated the process of working with commercial and government payers to ensure that Dojolvi is accessible for all LC-FAOD patients as indicated in the broad FDA label.

In the first week of launch, we received start forms from multiple doctors and centers of excellence, and we have shipped commercial therapy to our first patients. Just this week, the first reimbursements were approved for patients. We also had one newborn already prescribed Dojolvi whose older sibling had died at a very young age with FAOD. It is important to recognize that the reimbursement process does take time as various payers establish their new market policies. As a result, we expect the Dojolvi launch to build gradually over time and most of our 2020 revenue for the product to come from EU-named patient sales.

In the early stages of the U.S. launch, we are focused on transitioning the approximately 80 patients currently on clinical drug in the U.S. to reimburse commercial therapy. Our team has started conversations with these physicians at our clinical sites to provide information about these transitions, which we expect to complete in the upcoming months, dependent on payers' new-to-market coverage policies. Overall, we estimate that there are approximately 2,000 to 3,500 patients with LC-FAOD. The vast majority of these patients are seen at approximately 160 metabolic genetic centers. We are very familiar with these centers and their physicians based on our experiences with Mepsevii, Crysvita and our OTC and GSDIa programs. As a result, our incremental commercial investment will be minimal for this new launch.

And while launching in the midst of the COVID-19 pandemic is not ideal, the work that we have done to adapt to the current situation for Mepsevii and Crysvita will be extremely helpful as we launch Dojolvi. These adaptations, coupled with the patient's ability to take Dojolvi at home since it is an oral therapy, along with a high unmet need, give us confidence that we will be able to have a successful launch.

Turning now to Crysvita, which we are also launched -- currently launching it in U.S. for tumor-induced osteomalacia, or TIO, and have begun to treat our first commercial TIO patients. Many of the potential prescribers are the same group of endocrinology specialists that have become familiar with Crysvita for XLH over the last couple of years, so we are able to leverage our current commercial infrastructure. TIO, however, is much less common than XLH, affecting about 500 to 1,000 Americans, and it can take a long time to diagnose. Our initial focus is on conversion of clinical trials and compassionate use patients.

Similar to Dojolvi, we expect payers to update their policies for Crysvita to add the TIO indication over time. Good news is that the J-code for Crysvita remains the same for both XLH and TIO indications, which will simplify the buy-and-bill process for payers. To date, we have had multiple starts and patient reimbursements for Crysvita in TIO. We expect a gradual and steady revenue build in this new approved indication.

Crysvita for XLH continues to do well in spite of COVID-19-related challenges. Our patient support services team has reached out proactively to all of our existing patients individually to ensure continuity of care. Since the COVID-19 pandemic, we continue to receive new start forms and increase the number of patients on reimbursed therapy. Our field teams have done a noteworthy job in adjusting to this environment with our ATPs and have started to effectively use virtual platforms to engage with them. We expect to further build momentum as the country begins to reopen.

Across Latin America, there is a strong patient community that has driven a lot of awareness and demand for Crysvita. In Brazil, the region's largest market, this is seen in the steadily growing numbers of injunctions that are being granted and funded by both state and federal governments. Similarly, in Colombia and Argentina, the number of patients on reimbursed named patient treatment increases. Over time, we expect Latin America to provide a more meaningful contribution to revenue as the launch in this region progresses.

Because of the team's efforts to maintain continuity of care while also finding new and creative ways to reach patients, Crysvita's performance through the second quarter of 2020 has been strong. We are maintaining our revenue guidance of $125 million to $140 million for Crysvita revenue in the Ultragenyx territories. As a reminder, this range includes Crysvita and XLH and TIO and covers both profit share, revenue in North America as well as product sales in other regions.

With that, I'll turn the call over to Shalini who will walk through our financial results.

Thank you, Erik, and good afternoon, everyone. We issued a press release earlier today that included a financial update, which I will briefly summarize.

Total revenue for the 3 months ending June 30, 2020, was $61.7 million. For the quarter ended June 30, 2020, Crysvita revenue in the Ultragenyx territories was $32.4 million. This includes $29.8 million in collaboration revenue in the North American profit share territory and net product sales in other regions of $2.5 million.

Total royalty revenue related to the sales of Crysvita in the European territory was $5 million, which includes $1.5 million for sales in the region prior to January 1, 2020, from a change in estimate and release of reserves by our collaboration partner.

Mepsevii products revenue for the second quarter of 2020 was $4.2 million, and UX007 named patient revenue was $1.3 million. We also recognized $18.9 million of revenue related to the collaboration and license agreement with Daiichi Sankyo that was executed in March of 2020.

Our total operating expenses were $124.8 million for the second quarter of 2020, which includes research and development expenses of $80.7 million and SG&A expenses of $42.3 million. We expect our R&D costs to continue increasing over time as we advance additional product candidates from preclinical development into early and pivotal clinical studies. We also expect SG&A to modestly increase over the coming quarters as we support the expansion of our existing commercial programs and the launch of Dojolvi for LC-FAOD and Crysvita for TIO. We expect the split of R&D versus SG&A expense to remain fairly consistent.

In 2020 to date, approximately 17% of our operating expenses are noncash.

In the second quarter of 2020, we reported net income of $25.3 million or $0.42 per basic share and $0.41 per diluted share. This compares to a net loss of $93.7 million or $1.59 per share basic and diluted for the second quarter of 2019. The net income for the second quarter of 2020 includes a $95.2 million unrealized gain from the fair value adjustment on the investment in the Arcturus equity and the $18.9 million of collaboration revenue related to our agreement with Daiichi Sankyo. These were partially offset by $8.4 million in noncash interest expense on the liability related to the sale of future royalties.

Recall in the second quarter, we exercised our option to purchase 600,000 shares of Arcturus common stock at $16 per share. Upon completion of the additional equity purchase, Ultragenyx owns 3 million shares and continues to be Arcturus' largest shareholder.

For the first half of 2020, cash use in operations was $7.8 million, which includes $134.9 million of operating cash received from Daiichi Sankyo related to the collaboration and license agreement. We ended the second quarter of 2020 with $817.5 million in cash, cash equivalents and available for sale investments.

Moving to our guidance for 2020. We are currently maintaining the guidance range that we shared at the beginning of the year and affirmed on our first quarter earnings call. We anticipate Crysvita revenue to Ultragenyx in our territories to be between $125 million and $140 million. Those territories include North America, Latin America and Turkey and exclude the European royalty, as this was monetized in the transaction that was completed with Royalty Pharma that was announced in December of 2019. We continue to monitor the situation as the COVID pandemic persists.

I would now like to turn the call to Camille who will provide an update on our clinical programs.

Thank you, Shalini, and good afternoon, everyone. I will review our 2 new FDA approvals and progress with our Angelman syndrome program before handing back to Emil to provide more detail on our recent gene therapy clinical updates.

Starting with Dojolvi for long-chain fatty acid oxidation disorders, or LC-FAOD, a devastating disease with significant morbidities despite newborn screening and use of available management options. On June 30, we received the first-ever FDA approval of a treatment for patients with LC-FAOD. The approval spans all 6 types of LC-FAODs and applies to both pediatric and adult patients. As Erik's team works to make Dojolvi broadly available to patients living with this debilitating and dangerous disorder, the clinical and regulatory teams will be focused on 2 areas of next steps for the program.

First, we are seeking approval for Dojolvi in other regions around the world. We had previously submitted a marketing application to Anvisa in Brazil and more recently made a new drug submission in Canada where we have been granted priority review. Our discussions with the European Medicines Agency are ongoing. And in the meantime, we will continue to make the product available to the more than 70, 7-0, patients with LC-FAOD, who are receiving it based on requests from physicians seeking the product for reimbursed named patient treatment in France and Italy.

The development team's other area of focus going forward for Dojolvi is the implementation of our disease monitoring program or DMP. As a reminder, the DMP is a long-term, fully sponsored observational study of Dojolvi in LC-FAOD in at least 300 patients for a target of 10 years. The DMP will encompass all post-marketing requirements from the FDA in the single study.

Disease monitoring programs are just one development in innovation we are employing at Ultragenyx. For example, the DMP we initiated for XLH in 2018 has enrolled very rapidly. As a reminder, patients in the LC-FAOD DMP may or may not be receiving Dojolvi. Those patients who receive therapy in our DMPs all receive commercial reimbursed drug. This enables us to minimize post-marketing requirement costs while generating robust, high-quality data from these very large and very long-term studies.

Moving on to Crysvita for tumor-induced osteomalacia, or TIO, a rare debilitating disease for which approximately half of patients have tumors that cannot be surgically removed, leaving them with no other current treatment options. We've received FDA approval of the Crysvita supplemental BLA less than 2 weeks before the Dojolvi approval. The FDA approval for both pediatric and adult patients was based on data from 2 single-arm Phase II study that followed 27 patients with TIO for up to 144 weeks. In these studies, Crysvita was associated with increases in serum phosphorus and improvements in osteomalacia and healing of bone lesions. Similar to our other approved therapies, we will be implementing a long-term, fully sponsored observational DMP that will enroll at least 20 patients and who will be followed for over a 10-year period.

Shifting to Crysvita for X-linked hypophosphatemia, or XLH, which is approved by the U.S. FDA and Health Canada for the treatment of adult and pediatric patients 6 months of age and older with this rare bone disease. Recall also that Crysvita is approved in Brazil with a slightly different indication. Our partner, Kyowa Kirin, recently announced a positive opinion from the Committee for Medicinal Products for Human Use, or CHMP, in Europe to expand the XLH European approval to now include adults and, therefore, is labeled now for all patients at least 1 year of age. The initial EU approval only covered pediatric and adolescent patients who are still growing. Kyowa Kirin expects a final European Commission decision in the second half of this year.

Our first approved therapy, Mepsevii, which is approved for the treatment of mucopolysaccharidosis type 7 or Sly Syndrome occurring in approximately 200 pediatric and adult patients around the world, recently received a positive opinion from the CHMP on the type 2 variation. This variation would expand the EMA approval information to include long-term effects of Mepsevii on the reduction of urinary glycosaminoglycans, or uGAGs, and improvements in the multi-domain Clinical Responder Index as well as 6-minute walk test. We anticipate a formal decision from the European Commission in the second half of 2020.

I will now turn to our program with GeneTx Biotherapeutics to advance GTX-102, an antisense oligonucleotide for the treatment of Angelman syndrome. Angelman syndrome, as you know, affects approximately 60,000 patients worldwide and is a devastating neurogenetic disorder with a broad spectrum of disease manifestations, including speech and cognitive impairment, ataxia or balance issues, sleep dysfunction and seizures. There are no approved treatment options. This disease is a neurodevelopmental disorder and not neurodegenerative. So there is the possibility to reverse some of the manifestations.

Our partner GeneTx initiated the Phase I/II study of GTX-102 earlier this year, marking the first ASO to move into the clinic for Angelman syndrome. The first 2 cohorts have been fully enrolled, and patients have received multiple doses. Safety and efficacy data from the first 2 dose-escalating cohorts are currently being evaluated, and enrollment and dosing at the next dose levels are expected to resume shortly. To

(technical difficulty)

all we have achieved so far in 2020, and we will drive continued progress for the programs going forward. I want to commend our internal teams for successfully pushing through 2 concurrent FDA reviews as well as the joint team with GeneTx for its impressive progress with a potential therapy for Angelman syndrome. And importantly, I want to again thank the patients, families, caregivers and physicians who participated in the clinical program in LC-FAOD and TIO and those currently participating in the Angelman program, particularly in light of COVID-19.

I will now turn it back to Emil who will provide more detail on our gene therapies in development.

Thank you, Camille. As mentioned in my opening remarks, we had important data read outs from all 3 clinical gene therapy programs during Q2. Starting with DTX401 for Glycogen Storage Disease Type Ia. GSDIa is a life-threatening disease that requires patients to take cornstarch every 3 to 4 hours to avoid severe hypoglycemia and the risk of death as well as long-term complications. We presented at ASGCT the first data from a confirmatory cohort 3 on 6e12 dose as well as longer-term data from the earlier cohort. All cohort 3 patients responded to DTX401, as we saw in the earlier cohort. Cohort 3 patients, though, reduced their cornstarch usage at a faster rate by an average of 57% at week 12 versus 38% and 14%, at the same time point for the other 2 cohorts.

Looking at the longer-term data from cohorts 1 and 2, these patients reduce cornstarch use by an average of 83% with 4 of 6 patients discontinued daytime cornstarch use altogether. 2 patients have completely terminated all cornstarch use. These results suggest that DTX401 is dramatically changing the lives of these patients who, prior to gene therapy, would have been at risk for death with such significant reductions in cornstarch use. We continue to follow all patients in the study and expect to put out additional data on cohort 3 in the second half of this year. We plan to have an end of Phase II meeting with FDA in the same time frame as we gear up for our Phase III study in early 2021, depending on the impact of COVID-19.

Moving on to DTX301, a gene therapy for the treatment of ornithine transcarbamylase deficiency or OTC. OTC is the most common of the urea cycle disorders caused by an inability to detoxify ammonia into urea. And OTC patients can experience metabolic crisis that can result in neurologic issues, hospitalizations and coma. It sometimes results in death. The ASGCT data was an update to the initial cohort 3 data from January. ASGCT included 3 major updates. First, patient 9 is now confirmed as a responder to DTX301, following multiple sustained ureagenesis increases. His volume levels have remained stable at normal range over that time. 6 of 9 patients in the study are now confirmed responders, including all 3 patients in the highest-dose cohort 3.

Second, patient 8, a previous responder, is now along the path of becoming a complete responder after discontinuing scavenger therapy and starting to relax their diet. Third, all 3 of the previously disclosed complete responders remained stable through up to 2 years of follow-up. They remained well despite discontinuation of alternative therapies and the restricted diet for more than 1 year now.

The next step for this program is to treat 3 more patients at the cohort 3 dose with prophylactic steroids. Due to COVID-19, we have not yet dosed a patient in the prophylactic steroid cohort, but we are aiming to have data by the end of 2020. We intend to hold an end of Phase II meeting with the FDA and plan to start the Phase III in the first half of 2021.

In addition to these ASGCT updates, data was presented at the recent ISTH meeting on the hemophilia A gene therapy developed by our partner, Bayer. The new data covered the third dose cohort of 2e13 GC for HeLa in 2 patients in the Phase I/II study. DTX201 led to Factor VIII expression levels of 72% and 12.9% of normal at weeks 28 and 26. Of note, there were no spontaneous bleeds after reaching peak expression, including discontinuation of prophylaxis. One of the patients experienced a traumatic bleed but without the need for Factor VIII replacement therapy.

An update on the first 4 patients treated at the lower dose cohort showed stable Factor VIII expression after up to 16 months of follow-up. This provides further validation of Bayer's hemophilia program, including a relatively low dose as well as Ultragenyx' HeLa production system. The safety and efficacy is competitive with other hem A programs with good safety so far.

To close out with the prepared remarks, as you can see, we made substantial progress so far in 2020 and expect the same through the second half of the year. I'm proud that the company has been able to make all of this progress in the midst of the ongoing COVID-19 pandemic. The team has adapted and found creative ways to continue working with and supporting patients, their families and their health care providers.

With 4 approved programs, a strong balance sheet and one of the most experienced rare development organizations and an exceptional commercial team globally, Ultragenyx is poised for substantial progress in our development and commercial goals as a next-generation rare disease company. While we have accomplished a great deal in our first decade, we will continue to pursue the smart, efficient and effective development, setting the bar for effective rare disease development and commercialization using the exceptional team and company we've built to bring even more therapies to patients. We will do so with great urgency and dynamic development and commercialization as required to overcome the inevitable challenges, especially in the first-ever treatment for rare diseases. Thank you for joining us today.

And let's move on to your questions.

(Operator Instructions) Our first question is from Tazeen Ahmad of Bank of America.

Emil, just a little bit of color on Crysvita for the quarter. It seems like KHK have provided some commentary that COVID had some bit of an effect on new patient adds and might have even had some interruptions for continuing patients. Can you give us a little bit of color on -- to the extent you can on -- the level of impact that we've seen in 2Q? And then as it relates to TIO, how are you thinking about the initial ramp? Or how should we be thinking about expectations as it would still be launching into the COVID environment?

Very good. So on Crysvita in the U.S., I think we've been managing it very well. And we did -- we talked a little about the proactive effort, and I'll let Erik finish with that in a moment a little bit about the impact. We are probably not seeing the same impact they're seeing, but our territories are different. And so I think it has to be a factor in thinking through.

TIO is a relatively small indication that is slowly diagnosed, so we expect it's going to take time to build slowly as we continue to add patients.

Erik, maybe you can add a little bit on the Crysvita impact and our management of it in the second quarter.

Yes. So the majority of the Crysvita patients in the U.S. are receiving care at home. And we've been able to ensure the continuity of that care by working closely with the patients and their providers. Where there was concern if -- with having a home health nurse enter due to the COVID concerns, we were able to arrange for self-administration. And that's been the exception, and that there were also -- continuity of care has continued. And where there were concerns about sites of care where patients had to go into the clinic, we've been able to arrange for at-home administration and working with the payer as well as the provider.

With regards to the impact on new patient starts, there has been -- our ramp has dampened a little bit as it takes longer to identify, diagnose and initiate treatment as health care providers are seeing lower volumes of patients and certainly even less in their clinics. So the way I would think of this is it's not a demand issue. It's really more of a capacity issue, which is why we're confident as the country begins to open up that we'll have a rebound.

The next question is from Gena Wang of Barclays.

First, I want to say congratulations on a very strong quarter despite the COVID-19. So I have 2 questions. The first one is regarding Dojolvi. I'm not sure if I missed it. Did you mention start forms? And if so, was these across all different genetic backgrounds? And the second question is regarding the Angelman syndrome. How is the safety so far on the first 2 cohorts? And how would you decide the third dose?

Let's start with -- I'll start with the Angelman part, and then I'll let Erik talk about the Dojolvi launch question. First of all, Angelman, the program is managed by GeneTx. And we're encouraged with the results so far, but we're not disclosing information yet on the conduct of the study. We want to maintain the study's integrity, not discussing both efficacy and safety since it is an open label, but it's really up to GeneTx who's managing it. But as I said, we're encouraged with the results so far, and we expect to resume dosing shortly.

Erik, I think the question on Dojolvi is related to stocking. Is that what you said, Gena?

I think it's start forms. Start forms. So we didn't provide any specifics with regards to start forms. As we did with our other products, we'll begin to provide launch -- specific launch metrics, most likely in the next quarter, and it will probably be similar to what we did for Crysvita. But with regards to the performance in the early days, we're very pleased with the interest that we received from health care providers and patients. Shortly after approval, we started receiving start forms from multiple centers and prescribers, and that number continues to grow. And it includes a mix of patients that were in our clinical trials and receiving clinical drug for compassionate use as well as naive patients that are new to Dojolvi.

[So people will get] start forms...

Regarding the genetic background?

Genetic background of the patients being treated?

Yes.

Well, I don't think we would have provided that normally...

Well, being submitted for the start forms.

I don't think we would normally provide that breakdown. But obviously, VLCAD is, by far, the most common and CPT II and LCHAD are 2 others. Those 3 encompass most of the patients and the TFP and CACT are much less common. So it will be those 3, the majority of them, but I don't know that we'll be breaking out start forms by type. And I don't think there would be that much enlightenment there based on the clinical trial data, which I think showed effect across all patient types.

Our next question is from Yaron Werber of Cowen.

Yaron?

Yes. Can you hear me okay?

Now I can, yes.

Okay. Excellent. So I have a question on -- also on GTX-102. And so the study, I think, is intended to enroll 20 patients in 5 cohorts. So is it magic math and it's sort of 4 patients per cohort? And then, secondly, I think you mentioned that some patients got multiple doses, and I think they're supposed to get doses sort of -- 4 doses or so every 28 days. And so I just want to confirm that you can dose them sequentially that way. Each patient can get those doses, and it's sequential that everybody has to go through 1 dose, look at safety and then go to the next dose.

Yes. Good. So the dosing is even more magical than what you propose. It's actually 2 in the first cohort, 2 in the second cohort, and it goes to 4 and then a larger amount in the last cohorts, right? So the first cohort started at a much lower dose and titrated at each dose up, but we're reaching therapeutic doses by the time they got to their third or fourth dose, we would expect. And just a starting dose for each titrating cohort would start a little higher each time. So that's the basic design. And that -- but even the first 2 cohorts would be expected to get to therapeutic dosing range, at least from our expectations projecting from animal.

So the 2 cohorts have been receiving multiple doses, and that's what we've said. And there, we're always managing safety and efficacy because it's dose cohort, it means each dose is stepping up, and so they're continuously monitoring. And then there are DMC reviews that occur also during the process. So that's basically the structure. 2 cohorts of 2 patients each have received multiple doses so far. We're only -- we're encouraged, but we haven't said any more. We're trying to protect the integrity of the study.

Got it. So when you say the 2 cohorts are fully enrolled, is it fully enrolled sort of 4 patients each? Or really, there were 2 patients each so far?

2 each -- 2 patients in cohort 1 and 2 in cohort 2. Camille, am I incorrect?

Yes, that's correct. You're correct.

Okay.

Right. And they'll continue to enroll each cohort to up to 4 patients thereafter.

Yes. The next cohorts get bigger, 3 to 4 -- the cohort gets bigger. The idea is they wanted to have the cohorts that were for the early safety, very low doses were smaller because they were starting at a very low dose. But once you know the low dose is fine, then you can start the next cohort start at a little bit higher level instead of very low.

I think the great thing is that the clinical trial has proceeded, particularly at the one center despite COVID and kudos go to the doctors fighting for patients there and keeping this thing going.

The next question is from Maurice Raycroft of Jefferies.

This is Swapnil on for Maurice. So can you provide going into Dojolvi launch a little bit of more perspective in terms of dynamics related to adult versus pediatric ratio, reimbursement? And then what metrics will you be providing going forward? And then I have a follow-up.

Sure. So I'll touch on the adult versus peds. And then Erik, perhaps, you can talk about the dynamics going forward. I think one of the things you have to understand about the dosing of Dojolvi is that it's based on a percent of calories. And what that means is so by the time you get to like 7 or 8 years old, you reach kind of the peak level and your -- the cost per patient from late school age to adult is actually the same. So I'm making that point to you that actually, the number of adults or the number of 10-year-olds doesn't really matter. The actual revenue per patient is almost the same. Is that clear? It's not like other drugs that are weight-based. It's a little bit different. So it's a much flatter top curve on revenue per patient, if that's what your question is.

We expect to see adult and peds involved, and there's just different patterns of disease that you see in adults than pediatric patients. And patients have different manifestations, and peds later have different types of problems than adults. So -- but we expect to see adult and peds. I would say, overall, probably there's more kids with it mainly because that many of the kids are dying. So naturally, the number of patients that are younger are going to be more than -- because of the loss of patients over time.

Any other dynamics, or was it metrics I think you asked about the metrics going forward. Erik, maybe you can touch on what we'll do for metrics in Dojolvi for the coming quarters.

Yes. Most likely in the upcoming quarter, we plan to provide some launch metrics to help characterize the strength and momentum of the launch. We haven't determined exactly what those metrics will be. But for Crysvita, we provided a number of prescribers, patient start forms and patients on reimbursed therapy. So I would think we would do something similar to that.

And I think you -- did you have a question with regards to the payer landscape? Is that what you were asking? And was anything else...

No, I think this is good. I just had a follow-up question. So this is regarding clinical trials website. So I just recently saw that there is expansion for the number of patients for 401 from 9 to 18. And also for 301, there is like slight amendment of protocol in steroid use. So can you provide some thoughts on the changes to the protocol?

Well, you're talking about DTX301, is that correct? And DTX401?

Yes, that's right.

Yes. So for DTX301, we have said we're going to treat 3 more patients in a prophylactic steroid cohort. So that would -- there have already been 9 treated, then we'd have 3 more. For GSDI, we would -- we may do another cohort with earlier steroid treatment, but it's not a -- those patients would not be limiting toward our progression to Phase III. But that would be the other 3 patients.

Our next question is from Chris Raymond of Piper Sandler.

This is Ally Bratzel on for Chris. So one on DTX301 and 401. I know you've been talking about holding end of Phase II meetings with FDA in the second half to discuss data for those programs for a while now. So just wondering, are those meetings officially on the calendar yet? Or is that something that could be pushed back due to COVID or maybe other gating factors? Any color on the status of those discussions and just your confidence in the ability to start Phase III on the expected time line, first half '21, would be helpful.

Yes. We normally don't talk about when meetings are scheduled. It's just not something we normally disclose. But we don't anticipate having a problem having meetings for end of Phase II between now and the second half, as we've disclosed, and getting started in 2021. So at this point, I don't see a problem. I think the FDA, maybe not because of COVID, but because of how many gene therapy programs there are, are definitely burdened with a lot of applications and questions. That is putting a strain on them. But at this point, we don't see a problem with getting any of the Phase IIs done. But we'll certainly provide updates when we've had meetings and decisions have been made on what the plan is. But when we've had those meetings, then we know what's going forward with Phase III.

(Operator Instructions) Your next question is from Cory Kasimov of JPMorgan.

This is Gavin on for Cory. We just had a quick one on the Wilson program. Wondering what gating factors remain for the IND submission later this year?

Sure. We have already run, and I noted this before, the GMP production run, and we need to get through the testing related to that product. We have been running some of the nonclinical work. So far, the lab doing the nonclinical work have maintained. There's no question that both manufacturing and nonclinical have some impact with COVID, particularly workers get sick and they have to be kept home. But so far, it looks like those key activities are moving ahead. We're also -- have been discussing the program with the agency and coming up with our plan and for developing it. So, so far, we look like we're moving along well, but there's clearly some impact going on in the vendors. But right now, we don't see an obvious impact yet. And if something became clearer, then we would let people know.

The next question is from Laura Chico of Wedbush.

I wonder if we could go back to the Crysvita revenue guidance, and I apologize if I missed it. But wondering if we -- how should we be thinking about the impact of any Latin America, South American countries for Crysvita and kind of what assumptions are embedded in the guidance at this point. And maybe just longer term, does this still remain a viable region for you to pursue orphan treatments? Any color there?

Well, I'll answer the first part first. But I -- I mean, the last part first. We strongly believe in the Latin American region for rare disease treatments. And we expect that there will be always political and economic challenges at times there, but we think that there's a lot of patients and a willingness to support treatment in Latin America, and we will continue to pursue treatment.

So we feel it's part of our own ethic as a company to treat people where they need to be treated. And we think that [finding the recompensation] will be reasonable. In the past, we haven't broken out country by country. And I don't know if -- obviously, a majority of what's happening is in the North America territory, but we did note some improvement in Latin America.

Erik, I don't know if you want to add anything about Latin America. We haven't really disclosed those specific numbers yet.

And just to reinforce that, we think it's a significant -- has significant potential, and we see increasing demand across multiple countries in the region. And you can see that our revenue is steadily growing. So we're picking up momentum as we work through the named patient sales process, which takes some time, as we continue positive discussions with health authorities for formal reimbursement across multiple countries.

Very good. Thanks, Erik.

The next question is from Yigal Nochomovitz from Citi.

This is Carly on for Yigal. Just on DTX401 and 301, finalizing the endpoints for the planned Phase IIIs will clearly be a key topic of the upcoming end of Phase II meeting. So we just wanted to get your thoughts on what you would view as kind of the best-case scenario in terms of Phase III endpoints heading into those meetings for each program.

Well, yes, no, I get you. I think one of the reasons we like these 2 disease areas, frankly, is because they are biochemical genetic disorders. Therefore, the biochemical endpoints are, in fact, measuring the disease. OTC is a disease of ureagenesis -- ammonia is obviously the thing that accumulates if you don't have it -- and it's well described in literature. So we'd expect ammonia be part of it. And we will look to try to supplement the biochemical primary endpoints with secondary points that would give some measure in clinical efficacy. But we'd expect to have a biomarker primary endpoint in ammonia in some form.

Now for GSDIa, glucose is just a well-accepted biomarker from FDA. Implications of its level are well-accepted and well-known. And cornstarch, in this case, it's being used as a treatment, is essentially oral glucose replacement therapy. So if you don't give cornstarch, glucose goes low. And what we're seeing very clearly here is that the amount of cornstarch required is highly dependent on how much the gene therapy is releasing glucose on its own, sort of obviating the need for the oral glucose replacement. So we think that anything that manages glucose removal of the treatment like cornstarch reduction or monitoring glucose in some form tying to hypoglycemia, or maintenance of glucose is in the normal control region -- for example, using continuous glucose monitoring -- would all be wins for us because all of those are easily determined biomarker-based endpoints. And I think those would be ones that would be well powered in the trial. We will, of course, look at cognitive and other types of outcome. But we would look at those as secondary and tertiary outcomes, and we would not expect them to be part of the primary.

Okay. Great. That's helpful. And then just a quick follow-up. Could you talk a little bit more specifically about CGM and how that could be utilized as a potential primary or secondary endpoint for 401?

Sure. Well, the challenge with glucose monitoring is it's very good for diabetes, but until the Dexcom 6, it wasn't -- they weren't the best for GSDI specifically because of a particular challenge with measuring lactate. Lactate's very high in glucose and GSDIa. And so that -- if that interferes, it would create problems. The Dexcom 6 now gives you very accurate glucose even in the presence of lactate. And therefore, that's why it's a step forward in GSDIa, is that new probe.

When you have continuous monitoring, it allows you to monitor in real-world settings what patients are doing at home. And what we're learning from that and what we've shown is patients that are further down, more than 24 weeks, is that you can watch them all through the night, many nights in a row, right, with that and see that their glucoses are not going low, that they're managing without starch in the middle of the night. And then (inaudible) so it's possible to capture so much more data in the real-world environment that it's far, I think, more powerful than an in-hospital assessment drawing blood from a patient, to the very artificial setting. So I think it gives us a massive data. It gives us highs and lows to manage those in a repeated fashion that will allow us to both demonstrate the improved efficacy and safety and better control of glucose, both high and low, as important measures of glucose control. So we think it is a powerful part of the story and something that will really help us demonstrate the improved efficacy of using gene therapy versus oral cornstarch.

The next question is from Jeff Hung of Morgan Stanley.

For Crysvita and TIO, you indicated there are 500 to 1,000 Americans. Can you remind us how many patients in the U.S. have already been identified? And what kinds of efforts you're planning to identify additional patients? And then I have a follow-up.

Yes. We haven't really put out for any of our programs identified patient numbers. So we are not disclosing that. We're continuing to identify patients, but TIO patients are definitely can be more challenging to find because they're often -- because they are a new onset problem and it can take several many years, in fact, to diagnose, we need to work on helping people diagnose it quicker. But we're not going to be disclosing patient numbers at this point. We haven't for other programs either.

And you have a follow-up question?

Yes. And then for Dojolvi, you mentioned that there are some naive patients with the start forms. Can you comment on how the proportion of start forms from naive patients compare to your expectations?

Well, I don't think that, that proportion so early in the launch is going to be all that enlightening. Obviously, the doctors that are in our trials are watching and waiting and ready to go. So I think it will take a little time to kind of set out how much naive and how much start forms. But I don't think it's going to be that enlightening. But what Erik has already said is that there were many naive patients and clinical trial patients already prescribed. And I think most [unprecedented starting] was a newborn -- diagnosed newborn treated out the gate, which I think is -- I think an important part of the future of the product is actually having newborns diagnosed to get put on early in life instead of waiting for later when they have a crisis and then switching. So we think that's an important part of the story about naive. But right now, I'd say it'd be pretty early to talk in detail about the ratios to make any kind of conclusion.

The next question is from Salveen Richter of Goldman Sachs.

This Andrea on for Salveen. Maybe for our first one, if you could just speak on how you're focusing your efforts in allocating resources for your gene therapy programs versus other technologies under development, such as your ASOs.

I see. Well, the gene therapy program involves essentially multiple programs. 3 programs are going to be in the clinic, plus the fourth program, which is Bayer, plus early stage. So the gene therapy franchise and the team [we'll bring] is clearly a substantial part of our R&D investment, and we've added a number of people and built out the platform there. And so it's a really substantial investment there.

Our ASO deal with GeneTx, that is the one ASO we're working on. It's using standard ASO technology, contract-manufactured. And so it's a relatively focused choice. And in that situation for Angelman, the ASO strategy, eliminating the regulatory RNA, we think is the best strategy for treating Angelman. And that's why we opted to go in that direction because our goal as a company is to focus on the right drug for the right disease and not get hung up on our mechanism we happen to have inside the house.

So right now, gene therapy is a big investment area, ASO is a very targeted investment [on the] Angelman program.

Got it. And then maybe just another strategy question. We recently saw that agreement with Daiichi. Is this something that we should expect that you might pursue more collaborations like this in the future?

Yes. We expect to do another such collaboration in the future. We think that the HeLa cell platform, current version and the new version, which was -- some of which was presented at the ASGCT, are going to substantially improve the productivity and cost of goods for gene therapy programs and scale. And we think that that's going to be an increasingly important point of focus, more important than choice of capsids and other things. So we do think that the Daiichi deal will be something that we expect to do other deals on. They may be not quite the same, but I think people will want to have access to large-scale, [1 million] AAV production system. And the HeLa platform, we think, is the best one out there.

And our last question is from Vincent Chen of Bernstein.

Just one quick question on the DTX201 data at ISTH. I recognize it's still early days, but the longer-term data from the earlier cohorts shows very sustained Factor VIII expression up to nearly 1.5 years in 1 patient without any seeming loss of expression. And I guess, if this holds up well, this would potentially look a little different from what we're seeing with other hemophilia A gene therapies. Curious, how confident are you that Factor VIII expression will, indeed, be sustained over time, especially as you look to more patients and higher doses and higher levels? And I guess, what gives you confidence?

And then a second kind of related one quickly would just be, do you have any hypotheses as to what might drive what looks to be kind of late spike in Factor levels after week 24 in the sixth patient that was treated?

Sure. Well I'll talk about the stable-question issue. I think one of the things important in Factor VIII that's not fully appreciated is that Factor VIII as a protein is very hard to synthesize. In manufacturing Factor VIII at companies, they make milligrams per liter type of quantities because cells just can't make it. It's a very hard to fold protein. What's important then is when you're doing in vivo gene therapy, you're really doing Factor VIII replacement therapy with cells expressing it that are manufacturing inside the body. The key thing there to understand is if you make a cell express too much individually, you'll end up putting heat shock stress in the cells. They may not necessarily last long term. So optimal Factor VIII therapy in our minds would be achieved by having a larger number of cells producing a smaller amount of Factor VIII and that you would end up with a more stable producing cell rather than an over-expressed cell that can't actually continue doing that.

With the AAV8 Hu37 capsid, we believe we get a more prevalent, wider array of liver and other cells expressing Factor VIII. And by having more expression across many cells, we think that, that could potentially give you a more stable type of phenotype. We didn't do the hottest expressing promoters and things because, in fact, I think that is what creates more stress. And I think the team made good choices in finding a good expression clone but assuring that we're getting good distribution.

On patient 6, I don't have enough detail to tell you. I know the patient had received some steroids, and that may have been part of stabilizing some expression and causing them to increase. But I think if you look at all the patients, the pattern is kind of different. You see build -- a slow build of Factor VIII over time in most of the patients, right? It doesn't go spike and down. It's slow build. And I think that could bode well for a gene therapy that actually would last more years.

Now remember, AAV8 was used in the original Factor IX program that was published. And those patients had stable Factor IX for 10 years. So we think that the problems of distributed cells to produce Factor VIII are going to be an important feature in getting stable long-term expression. And I think, so far, the data are encouraging, but let's face it, it's very early, and many other programs have much more data. And so we're going to wait and see how it comes out. But we're encouraged that perhaps, our program with Bayer will turn out to be an excellent Factor VIII gene therapy.

When might we expect to see updated data for that?

Well, we are not in control of the development of that. It's really under Bayer's control. So I would have to really defer to them on how it's going. I think they are obviously very Factor VIII-experienced. They have investigators around the world. I think they are very encouraged and excited about the data they're seeing. So I'd expect them to be doing the updates, and we're, at this point, in the mode of following along and supporting them where we need to.

And this concludes our question-and-answer session. I would now like to turn the call over back to Mr. Higa for closing or further comments.

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

Ladies and gentlemen, this does conclude today's teleconference. You may now disconnect. Thank you for your participation.