Ascendis Pharma A/S

Good morning, ladies and gentlemen, and a welcome to the Q4 2020 Ascendance Farmer Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. If anyone should require assistance during the conference, please press star, then zero on your touchtone telephone. This call is being recorded. I would now like to turn the conference over to your host, Mr. Scott Smith, Senior Vice President and Chief Financial Officer of Ascendus Pharma. Please go ahead, Jay.

Thank you, Operator. Thank you, everyone, for joining our full year 2020 financial results conference call today. I'm Scott Smith, Chief Financial Officer of Ascendus. Joining me on today's call are Yen Mickelson, President and Chief Executive Officer of Dr. Mark Bock, Head of Clinical Development and Medical Affairs for Endocrinology Rare Diseases, Jesper Hoyland, Global Chief Commercial Officer, Dr. Dana Pizzuti, Head of Development Operations, and Dr. Juha Poonanen, Head of Oncology. Before we begin, I would like to remind you that this conference call will contain forward-looking statements that are intended to be covered under the safe harbor provided by the Private Securities Litigation Reform Act. Examples of such statements may include, but are not limited to, our progress on our pipeline candidates and our expectations with respect to their continued progress, statements regarding our strategic plans, our goals regarding our clinical pipeline, statements regarding the market potential of our pipeline candidates, and statements regarding our regulatory filings. These statements are based on information that is available to us today. Actual results or events could differ materially from those in the forward-looking statements, and we may not achieve our goals, carry out our plans or intentions, or meet the expectations or projections disclosed in our forward-looking statements. And you should not place undue reliance on these statements. Our forward-looking statements do not reflect the potential impact of any licensing agreements, acquisitions, mergers, dispositions, joint ventures, or investments that we may enter into or terminate. We assume no obligation to update these statements as circumstances change, except as required by law. For additional information concerning the factors that could cause actual results to differ materially, please see the forward-looking statement section in today's press release and the risk factor section of our prospective supplement filed on July 9, 2020, and our annual report on Form 20F being filed today. Please note that our Transcon product candidates are investigational product candidates and are not approved for commercial use. As investigational products, the safety and effectiveness of the Transcon product candidates have not been reviewed or approved by any regulatory agency. None of the statements made on the conference call regarding our Transcon product candidates shall be viewed as promotional. On today's call, we will discuss our full year 2020 financial results and provide a business update. Following some prepared remarks, we will then open up the call to questions. I will now turn the call over to Jan Mikkelsen, our President and Chief Executive Officer.

Thanks, Scott, and good afternoon, everyone. For Ascendis, 2020 was a year to remember. We succeeded as a team and were able to meet. and in some cases exceeded all our corporate goals in 2020. I am proud to be able to say that the Ascended team was adaptive, creative and focused on achieving the goals we outlined at the beginning of last year to bring our Transcon product candidates to patients as fast as possible. For 2021, we are well positioned to continue to execute and achieve the milestones we have laid out across all of our five independent product candidates. Going back, the importance of the science, one of Ascendi's core values, is really at the center of what we do 365 days a year. Our understanding of the biology and the science It drives our drug development process. I see it again and again. If we stick to the science, understand and respect the biology, we will be successful. With our algorithm for product development focused on the patient and the unmet medical need, combined with the Transcon technology, we have a powerful platform that has allowed Ascendi's to create not just one potential blockbuster product candidate, but a portfolio of five potential blockbuster candidates in two therapeutic areas with more to come. Beginning with Transcon Growth Hormone. Throughout the development, we have kept the patient needs in mind. From the beginning, We were committed to build on the last 30 years of knowledge with daily growth hormone and other long-acting growth hormone programs. We designed our Transcon growth hormone to have a similar tissue distribution pattern, receptor activation, and exposure as seen for daily growth hormone. Once somatopine is released from the Transcon growth hormone product. For more than 30 years, multiple companies have tried to develop a long-acting growth hormone product using several different technologies, providing comparable safety, efficacy, solubility, immunogenicity, mode of action as daily growth hormone. In spite of all this effort, today all patients are still being treated with daily growth hormone in the US, Europe, and Japan. I am excited to be close to our potential regulatory approval of transplant growth hormone in the U.S. and Europe. Last June, we submitted our BLA for transplant growth hormone for the treatment of pediatric growth hormone deficiency, and we have a PDUFA date of June 25, 2021. Later in September last year, we submitted our MNA in Europe. And we expect potential improvement in the fourth quarter this year. Since our regulatory submission, I can see the payoff from our design of Transcon growth hormone and the extensive preclinical and clinical programs in our interaction with FDA and EMEA. We believe our data clearly demonstrate once-weekly Transcon growth hormone has comparable mode of action and distribution in key growth hormone responsive tissues, such as brain, bone, muscle, liver, and fat tissue, as the growth hormone substrate for daily growth hormone and industrial growth hormone. In our discussion with FDA and MIA, give me comfort that we have developed a convincing body of non-clinical and clinical data to support our belief. In December last year, we had a positive mid-cycle meeting with FDA, where they indicated the agency has no plans for an advisory committee. We continue to have a constructive dialogue. and have begun labeling discussions with the FDA. And we are looking forward to a potential regulatory approval next quarter. In Europe, our M&A submission for Transcon-Globetamol last September followed the agreement with PEPCO to our proposed pediatric investigation plan, or called PIP. covering the non-clinical and clinical development of transcon growth hormone in children down to age of 6 months. To our knowledge, no other growth hormone or growth hormone analog has an approved PEEP. Our expectation for potential approval of the MNA in the 4th quarter of this year is unchanged. But our innovation did not stop with the design of our drug substance. As part of our effort to address the unmet medical need, we have also developed an autoinjector for the administration of transcon growth hormone, providing wound temperature stability and a small injection volume via a 31G needle. We introduced the transcon growth hormone autoinjector into the Phase III enlightenment trial where it is currently being successfully used by over 160 subjects in the U.S. with accumulated use of more than 225 device years. We expect the Transcon-Globetamone Autoinjector will be available to patients at the same time as the potential commercial logs. Going forward, we are developing an integrated connective health program that links the Transcon growth hormone autoinjector with an app and provides information for the patient and caregivers related to adherence and doses. The pediatric growth hormone market is an established market in the U.S. and Europe with several daily growth hormone products. But we also know that drugs don't work in patients who don't take them. Even modest lack of adherence leads to suboptimal outcomes and potentially to drop out of therapy. In fact, we see that almost all pediatric patients in the U.S. stop therapy after three to four years of treatment. We have submitted for publication a manuscript based on claims data. demonstrating that the problems of adherence and lack of treatment are potentially much worse than reported in published literature. I often get asked if we think we can expand the current market with Transcontinental. These new data describing lack of adherence and lack of treatment tell me that there is a potential big opportunity to improve patient care by improved adherence, persistence, and penetration, which will lead to better outcomes for patients and better outcomes for the society. So far, I have talked about U.S. and Europe, but we are not stopping there. Ascentis is a global company with a global thinking addressing unmet needs for a worldwide population. In Japan, we filed a clinical trial notification last year to initiate the phase 3 right trial for pediatric growth hormone deficiency. In China, in 2018, we formed Vision Pharmaceutical with an investor group to develop Transcon endocrinology rare disease product in Greater China. Vision continues to execute on its Phase 3 clinical trial of transcon growth hormone in children with growth hormone deficiency and will initiate clinical development for transcon PTH and transcon CMP soon. Moving to label expansion. We have the global Phase 3 foresight trial underway for adult growth hormone deficiencies. The primary objective of the foresight trial, from a regulatory perspective, is to demonstrate efficacy compared to placebo. However, the most important comparison is to data growth hormone, which is included as a third arm in the foresight trial, where we plan to randomize 240 subjects one to one to one. I'm often asked, Why is adult growth hormone deficiency so important? What do you get out of the foresight track? Growth hormone deficiency is not just about height. In children, height emerged as the primary regulatory endpoint. Since adults are not growing in height, the primary regulatory endpoint is to measure the metabolic consequence of growth hormone deficiency, to measure change in trunk fat, Only if a once-weekly growth hormone therapy is equivalent or better to daily growth hormone in both the pediatric and adult growth hormone deficient population, then it will provide all the endocrine benefits of daily growth hormone. We believe from our Phase III pediatric programs that Transcon growth hormone can provide all these endocrine benefits. Combined with a success in adult growth hormone deficiency phase three trial. We believe we will continue to differentiate from all once we do growth hormone product candidates. We expect to complete enrollment of the foresight trial by late 2021 or early 2022. Moving to Transcon PTH. I've never seen a product like this before. A product that not only can address short-term symptoms of the disease by restoring biochemical control and the quality of life for a patient, but also potentially can address the long-term complication of the disease as well. Hypoparathyroidism, HP, is a condition which affects more than 200,000 patients just in the US, Europe, and Japan. Similar to growth hormone deficiency, where the problem is absent or insufficient amount of the respective hormone, in this case for HP PTHs. In chronic and post-surgery HP, in around 75% of all cases, the parathyroid glands, the organs that produce PTHs, have been damaged or destroyed, and the body cannot be stimulated to produce sufficient amount of PTHs. Therefore, the only way PTH can be restored to normal physiological level is by PTH hormone replacement. Transcon PTH is designed to replace the hormone at physiological levels and restore the patient to normal health. When we speak to patients suffering from HP, we hear over and over again about how poor the quality of life is. how they had to stop going to work, all worried about calcium crashes and making it to an emergency room. These are the short-term symptoms driven by lack of serum calcium control and physiological PTH levels. In addition to the short-term effect, HB patients have multiple long-term complications as insufficient kidney function, cardiovascular risk, and abnormal bone turnover. As Transcontinental PTH is designed to restore PTH to physiological levels 24 hours a day, we will expect to normalize serum calcium to improve short-term symptoms. We also expect to normalize kidney function and normalize bone health to reduce long-term complications. So what have we seen? With our six-month open-label extension, or OLE, we saw all mean summary and subdomains SF-36 quality of life scores being normalized. Later this month, we will present data at an oral presentation at ENDU, where you will see results for the first time from our HP disease-specific patient-reported outcome instrument after six months in the OLE. Since then, all 58 subjects have now completed 12 months of treatment on Transcon PTH without any additional dropout, which gives me confidence that these subjects are continuing to see the quality of life benefit with a safe once-daily PTH injection. In addition to the great data on quality of life, Transcon PTA also demonstrated normalization of key biochemical parameters related to long-term complications. After six months in the OLE, mean 24-hour urinary calcium excretion fell on average 57% compared to baseline. Almost all subjects demonstrated a normalization or improvement in urinary calcium excretion. On measures on bone health, HP patients typically have low bone turnover, and as a consequence, abnormal dense bone compared to people without HP, particularly the trabecular bone. As expected, as we restore physiological PTH level, we saw bone turnover increases with the initiation of transcon PTH treatment, resulting in a trend towards normalization of the abnormal dense bone, particularly the trabecular bone. So what is next for Transcon PTA-8? During the second quarter of 2021, we plan to provide 12-month OLE data. We expect to see continued normal quality of life, sustained reduction of HP symptoms, continued normal serum calcium, continue normal level of urinary calcium, and continue normal bone turnover. As part of extending our global reach for this potential life-changing therapy, during the second quarter, in addition to the 12-month PTH Forward update, we plan to submit a clinical trial notification for a trial evaluating transcone PTH for adults HP in Japan. Later this year, in the fourth quarter, we plan to report top-line results from the part-way trial. At phase three, randomized, double-blinded, placebo-controlled trial, investigating the safety, toolability, and efficacy of Transcon PTH in adults with ASP. The trial is expected to enroll 76 subjects as sites in North America and Europe. We are pleased by the data that we have generated so far, and we believe the data support a profile for Transcon PTH to be a potential first-line therapy for HP. We are confident we can truly make a difference in the life of HP patients. Turning to Transcon CMP, we are conducting two double-blind placebo-controlled phase 2 trials in children aged 2 to 10 years old. The first, the ACCOMPLICE trial, is a dose escalation trial of 12 to 15 subjects in each cohort, conducted mainly in North America and Europe. The second is the ACCOMPLICE China trial, which is a cohort expansion trial of at least 60 subjects conducted in China. Beeson received approval from the Chinese Center for Drug Evaluation to conduct the accomplished China trial with a design for dose expansion at an effective dose determined from the accomplished trial. Combined, these two studies will enroll more than 120 subjects, age 2 to 10, to be followed for 12 months in a double-blinded manner. Both Accomplice and Accomplice China will remain blinded until the 20-month follow-up is completed. Once completed, we will have robust clinical data from two independent, randomized, double-blinded placebo-controlled trials. We plan to provide a Transcon-CMP clinical program update in the fourth quarter of 2021. Finally, In endocrinology, we announced today that centers will have a chairman presentation at the end of 2021 annual meeting. This will include an oral presentation of the six-month open-label extension from the Path Forward trial for transcortin PTAs, as I mentioned. In our second therapeutic era, we hosted our first Oncology R&D Day back in November to share our vision on how to use transcon systemic and intratumoral technology to establish a new paradigm for treatment of cancer. We think we can develop an entirely new treatment paradigm in oncology using transcon technologies and address all steps of the immunity cycle. We are applying the same product development algorithm in oncology as we have successfully used in endocrinology, applying Transcon technology to clinical validated parent drugs and biological pathways. For Transcon TLR78 agonist, an IND was submitted in December 2020 to initiate the Phase 1-2 Transcen IT 101 trial during the second quarter of 2021. following monotherapy dosing. We plan to initiate dose escalation in combination with a checkpoint inhibitor. Initial monotherapy dosing results are expected in the fourth quarter of 2021. For Transcon AL2 Beta-Gamma, earlier this year we reported potential best-in-class preclinical data. Our transcranial 2-beta gamma is designed to have best-in-class potency receptor bias combined with a long half-life of around 22 hours and a low Cmax concentration. In non-human primary study, we have observed a highly biased potent activity with sustained exposure leading to best-in-class immune cell expansion with minimal effect of eosinophils. IL-5 or IL-6 and vascular leak marks. Based on this data, we believe transcon IL-2 beta gamma has the potential to become a backbone agent in oncology treatment. We expect to submit an R&D or similar for transcon IL-2 beta gamma in the third quarter of 2021. I sincerely believe that our goals of building a fully integrated global biopharmaceutical company gets one step closer each day. 2020 was a great year, a year to remember for Ascentis, as we advanced our endocrinology rare disease and oncology product candidate. In 2021, we look forward to achieve additional successes as we advance our pipeline ahead and closer to patients with unmet medical needs. We are continuing to apply our algorithm to build a pipeline in oncology and are committed to entering a third therapeutic era. This is how we will achieve sustainable growth. Not by advancing just one program, but succeeding with multiple potential blockbuster programs in multiple therapeutic areas in multiple geographies. Now, let me turn We call over to Scott for a financial review before we open up for questions.