Ultragenyx Pharmaceutical Inc. (RARE) Earnings

Management highlights

- Commercial Execution & Growth * Q2 2026 delivered the highest quarterly revenue in company history, with strong underlying demand across the existing product portfolio after a seasonal rebound from prior quarter variability. * CRISVITA: Steady growth in North America; strong performance in Latin America with ~50 new patients added in Q2, bringing the regional total to 1,000 patients; over 100 patients treated via the Named Patient Program in Turkey with accelerating demand. * DeJolbe: ~675 patients on reimbursed therapy in North America; ~300 patients via named patient/early access programs in Europe, with strong growth in the MENA region after approval in Kuwait; successful launch in Japan following national health insurance listing, with strong early demand. * Evkiza: Over 500 patients across 25 countries outside the U.S., with ongoing work to secure country-by-country reimbursement and convert early access patients to reimbursed therapy. * The global commercial infrastructure is fully established, with deep market-by-market expertise for rare disease patient finding, reimbursement navigation, and field execution, and is ready to support upcoming gene therapy launches. - Pipeline & Regulatory Progress * DTX401 (gene therapy for GSD1A): Biologics License Application (BLA) is under FDA review with a PDUFA action date of August 23, 2026 (just weeks after the call). Clinical data shows treatment enables clinically meaningful reductions in corn starch dosing and improves glucose regulation, reducing disease burden for patients. * UX111 (gene therapy for Sanfilippo syndrome type A): BLA is under FDA review with a PDUFA action date of September 19, 2026. Clinical data shows treatment reduces heparin sulfate and stabilizes cognitive function, with better outcomes observed when treating earlier before irreversible neuronal loss. * GTX102 (apazunersen, ASO for Angelman syndrome): The Phase 3 ASPIRE study has completed all 48-week patient visits, the database is being cleaned and locked, and top-line unblinded results are expected in September-October 2026. The study has two co-primary endpoints split with 80% of statistical alpha allocated to the Bayley-4 cognitive raw score and 20% to the Multi-Domain Responder Index (MDRI); either endpoint reaching statistical significance will count as a study success. * UX143 (citruzumab for osteogenesis imperfecta): Neither of the two Phase 3 studies (ORBIT and COSMIC) met statistical significance for their primary endpoint of annualized fracture reduction, though signals of biologic activity, improvements in bone mineral density, and positive patient-reported outcomes were observed. The MHRA has indicated a new randomized trial is likely required for approval, while the FDA is open to alternative fracture analysis approaches; additional discussions are needed to define required additional clinical data. - Launch Preparation * Preparations for simultaneous launch of DTX401 and UX111 are progressing as planned, with contracting for qualified treatment centers well underway and strong clinician engagement driven by high unmet need. * Market access preparations are complete, with over 200 payer engagements completed that have resulted in broad payer recognition of unmet need and treatment urgency. * Launch investments are already incorporated into existing operating expense guidance, and leverage the existing commercial infrastructure, requiring only incremental targeted investment.

Guidance

- Management reaffirms full-year 2026 guidance for total revenue and combined R&D and SG&A operating expenses. Full-year 2026 combined R&D and SG&A expenses are expected to be flat to down low single digits compared to 2025, with all planned launch investments for DTX401 and UX111 already included in this guidance. - Management reaffirms the target of achieving profitability in 2027. The path to 2027 profitability is based on three core pillars: continued double-digit revenue growth from existing commercial products, incremental revenue contributions from DTX401 and UX111 if approved, continued disciplined expense management with 2027 combined R&D and SG&A expenses expected to decrease by at least 15% compared to 2025, and potential non-dilutive capital from monetization of priority review vouchers (PRVs) for DTX401 and UX111 if approved. - Management noted that there are multiple operational and financial levers to achieve 2027 profitability, and the target is not entirely dependent on a fast launch ramp for the new gene therapies.

Segment performance

Total company revenue for Q2 2026 was $214 million. The breakdown by product segment is as follows: - CRISVITA: Contributed $156 million, equal to 72.9% of total Q2 2026 revenue. This includes $94 million from North America, $54 million from Latin America and Turkey, and $8 million from Europe. - DeJolbe: Contributed $27 million, equal to 12.6% of total Q2 2026 revenue, with steady demand growth in line with expectations. - Evkiza: Contributed $21 million, equal to 9.8% of total Q2 2026 revenue, representing 50% year-over-year growth from Q2 2025 as the business expands outside the U.S. - Mepsevi: Contributed $10 million, equal to 4.7% of total Q2 2026 revenue, for treatment of patients with this ultra-rare indication.

Risks & headwinds

- All forward-looking statements, including regulatory approval outcomes, launch timelines, clinical study results, and profitability targets, are subject to inherent risks and uncertainties that could cause actual results to differ materially, as detailed in the company's latest SEC filings. - There is regulatory risk for DTX401 and UX111: final FDA approval is not guaranteed, even after completion of the BLA review process. Additional regulatory requirements may emerge that delay or prevent approval. - There is clinical trial risk for GTX102: the Phase 3 ASPIRE study may fail to meet the required statistical significance threshold for either co-primary endpoint, even with positive trends or meaningful clinical activity. - There is uncertainty around the path to approval for citruzumab for osteogenesis imperfecta: additional clinical trials will almost certainly be required, which will add cost and delay any potential approval. - As of June 30, 2026, the company held $436 million in cash, cash equivalents, and marketable securities, which creates reliance on non-dilutive PRV monetization or potential future financing if new product launches are delayed or underperform, to fund operations through 2027 profitability.

Analyst Q&A

• Q: Can you confirm that the FDA agreed that either co-primary endpoint for GTX102 being statistically significant would be sufficient for approval, and confirm the endpoints were powered to show clinically meaningful results?

  A: The FDA did agree to the split of statistical alpha between the two endpoints, and this design allows for success if either endpoint meets its required p-value threshold. A 5-6 point average change in the Bayley-4 cognitive score is considered clinically meaningful, which is what the study is powered to detect. The MDRI endpoint is only scored when changes meet pre-set clinical meaningfulness thresholds, so a positive MDRI result inherently means clinically meaningful benefits.

• Q: What is the sensitivity of the MDRI endpoint for GTX102 compared to the cognitive endpoint, and why was this relatively novel endpoint selected?

  A: The MDRI aggregates clinically meaningful changes across multiple disease-relevant domains, which makes it substantially more sensitive to detecting overall treatment benefit than single endpoints. The company has used this endpoint successfully in prior rare disease trials, where it proved 10x more powerful than individual endpoints for detecting treatment effect. It also provides a more complete assessment of treatment benefit across the multiple diverse symptoms of Angelman syndrome, making it a more meaningful endpoint for this complex disease.

• Q: With the PDUFA for DTX401 just weeks away, how has the FDA review progressed, and are any outstanding CMC or manufacturing items still pending?

  A: The FDA did issue information requests during the review for both clinical and CMC sections of the BLA, and the company has completed all responses to these requests. The review has proceeded in a normal regulatory timeline to date, and management feels the application is in good shape, though the final FDA decision cannot be predicted ahead of the PDUFA date.

• Q: What is the estimated addressable patient population for DTX401 (GSD1A) and UX111 (Sanfilippo type A), and what is the current cash position and plans for financing ahead of upcoming launches?

  A: The developed-world addressable population is ~6,000 patients for GSD1A, with 1,500-2,000 patients in the U.S., and ~3,000-5,000 total global patients for Sanfilippo type A, with ~750-1,250 patients in the U.S. As of end-Q2 2026, the company has $436 million in cash, cash equivalents and marketable securities. All planned launch investments are already included in existing operating expense guidance, and the company's primary near-term financing plan is to monetize the two priority review vouchers that come with approval of DTX401 and UX111, which will provide non-dilutive capital to support operations.