Ladies and gentlemen, thank you for standing by and welcome to the Ascendis Pharma First Quarter Earnings Conference Call. [Operator Instructions] And now it’s my pleasure to turn the call to Scott Smith, Senior Vice President and Chief Financial Officer of Ascendis Pharma.

Thank you, operator. Thank you everyone for joining our first quarter 2020 financial results conference call today. I am Scott Smith, Chief Financial Officer of Ascendis. Joining me on today’s call is Jan Mikkelsen, Chief Executive Officer; Dr. Dana Pizzuti, Head of Development Operations; and Dr. Juha Punnonen, 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 the planned 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 maybe expectations or projections disclosed our forward-looking statements. And you should not place undue reliance on these statements. 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 statements section in today’s press release and the Risk Factors section of our most recent annual report on Form 20-F. Please note that our TransCon product candidates are investigational product candidates and 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 first quarter 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. Jan?

Thanks, Scott and good afternoon everyone. In this quarter, we continue to execute on our strategic goals, advancing towards our vision to build a fully integrated biopharma company. We reported positive data from our Phase 2 PaTH Forward trial demonstrating that TransCon PTAs has the potential to be a true replacement therapy in hypoparathyroidism. We submitted an IND amendment to FDA to imitate our global adult growth hormone deficiency Phase 3 trial, the foresiGHt trial. We continue to build out our global commercial organization with the hiring of Jesper Høiland. We are demonstrating the flexibility and focus of the Ascendis team to execute on the task with minimal impact from the COVID-19 situation. We are happy to see our office in Denmark and research and development facilities in Germany have now reopened for normal orations. In addition, we opened our new resource and development facility in Redwood City, California. This facility is dedicated to our oncology division, including specific CMC activities related to the TransCon technology for sustained localized release. To be successful in our strategy to build a leading global biopharma company, we not only need to have the right product, but we also need to have the combined effort of the most talent workforce. Our vision is to not just to get a product to the market, but we aim to establish leading market positions for each of our products. As we prepare for the potential launch of TransCon growth hormone, we announced the appointment of Jesper Høiland as Global Chief Commercial Officer. Jesper has 20 years of commercial leadership experience with growth hormone products. Hiring a global leader with therapeutic experience is the logical next step in our preparation for the global launch of TransCon growth hormone and the rest of our endocrinology rare disease portfolio. As…

Thank you, Jan. Turning to our financial results for the quarter ended March 31, 2020. We reported a net loss of €63.3 million or €1.32 per basic and diluted share compared to a net loss of €53.6 million or €1.24 per basic and diluted share during the same period in 2019. Now let me run you through some key components of these results. Research and development costs for the first quarter were €57.5 million compared to €51.3 million during the same period in 2019. Higher R&D costs reflect continued advancement of our pipeline, with the primary drivers, including an overall increase in personnel-related costs and higher costs related to the continued build-out of our oncology therapeutic area. For TransCon PTH and TransCon CNP, costs were relatively flat with higher clinical trial costs offset by lower manufacturing costs. And for TransCon growth hormone, costs were lower compared to the same period of prior year due to reduced payments and activities related to the preparation of validation batches. General and administrative expenses for the first quarter were €17.9 million compared to €10.4 million during the same period in 2019. These higher costs primarily reflect an increase in personnel and related costs as well as continued build-out of our commercial capabilities. Other income and expenses included in an unrealized noncash gain of €10.3 million compared to an unrealized noncash gain of €3.1 million during the same period in 2019 due to foreign currency exchange rate fluctuations. We ended the first quarter with cash and cash equivalents of €534.4 million. We also remain on track to achieve the following milestones for the remainder of 2020: For TransCon growth hormone, these include submitting the BLA filing in the second quarter; submitting the MAA filing in Europe now in the third quarter; initiating a Phase 3…

[Operator Instructions] And our first question is from Tazeen Ahmad with Bank of America.

Hi, good afternoon. Thank for taking my question. Jan, I just wanted to ask about your oncology platform. You’ve now chosen the PLR molecule to be the first one that you’re moving into the clinic. Can you just give us some color about the characteristics that make this the right candidate to move into the clinic and what potential indications you could be looking at once it moves into patients? Thanks.

Thanks, Tazeen. How we really look in our oncology? There is not one right product. There is a series of right product, and this is why we’re building up our pipeline in oncology. We are not just coming with one single product. We’re coming with a pipeline of product opportunity. So what we continuously saying is, what is the role of product opportunities be launching to INDs through the next multiple years. And that is exactly what we are planning now. So we’re planning for the two. First one is our TransCon TLR 7/8 and the next one will be our bias best-in-class IL-2 compound. And I think both of them are really unique. Why we took one, in front of the other is mainly because we don’t really see that, it’s some kind of – except else that we’re utilizing some of the same resources in filing and executing of the clinical trial, so we took one in front of the other one. And from the value perspective, I believe both of them are high-value product opportunities. And the next two ones we will disclose next year, that we moving forward will also be in the same group of high value. But I like to think why we’re building up a pipeline. It’s because we believe that when you think about what we’re doing with the two different mode of action of this two compound, TLR 7/8 is a complete paradigm shift, where you place an activator of the tumor inside the tumor, not for just an intratumoral injection for about 1 hour, 2 hours and then it’s gone. We can place it in a tumor for months and it can stay in the months and activate the tumor. This is why we believe this is a way we basically can transform a cold tumor over to a responsive tumor. And then you can see how it also can be combined with the other drug. Because I believe that real, best-in-class bias IL-2 compound can be exactly as valid as we saw checkpoint inhibitor were, because we basically are starting to press up the speed of the immune system. And this is where I see our value proposition in oncology, is not a single drug, but it will be of a streamline of our dedication to develop best-in-class unique product opportunity inside oncology.

So would you want to move multiple molecules into the clinic before determining what indications you choose for each?

But I think when you look at a compound like both of them, there is multiple indication we can address. All kind of solid tumor, we basically should be possible to address with our TLR 7/8. And this is why we see that as compound that have broad applicability across a lot of different kinds of tumors and then you can ask, what is exactly the two or three first tumor we want to eliminate, that is what we will disclose later this year? And we’re building up a very, very strong medical team that will come out and disclose that later through the year, where you will get a flavor about what multiple programs we will conduct in oncology.

Okay, thanks, Jan.

Thank you. And our next question comes from Michelle Gilson with Canaccord.

Hi, thanks for taking my question. I have one on TransCon PTH. Just as suggested that hypoparathyroidism patients are very complex to treat on standard of care supplements. Could you just maybe share some of the feedback that you’re getting from the investigators on your Phase 2 study about their experience using TransCon PTH, especially now that we’re kind of starting to get beyond that titration period in the open label extension? And are you hearing that it’s simplifying treatment of these patients for them? And are their patients pretty excited about it now that they’ve been moved on to active from placebo for some of them? And then just, would you expect that 58 of 59 that are continuing now to continue on into, I guess, the future based on this – the feedback from your investigators?

I think, Michelle, you actually had a really great interview with one of our key investigator, I think that was this morning here. And I actually think you received a lot of feedback from her related to the treatment of the patient, and sure you can also some way share that with other people. But we’re basically seeing the same thing across all the sites. And it’s really also being confirmed by how we see the retention of in the trial. We basically had 58, and all of them stayed in the treatment, despite COVID-19, despite being middle of Italy, in Milano, one of the hot places for the COVID-19 in Italy. We are in a position where we see this is really providing such a huge benefit to the patient that they really are staying on the treatment. And it was not what I typically see just in a diabetes trial or anything like that, where you already, at that stage, we’ll see a lot of dropout of patients here. I believe this is really transformative too, for the patient and everything what we get back and seeing of data is only supported. But you also got the feedback this morning.

Alright. And just as a follow up also you mentioned on your last call that you were planning some FDA discussions around breakthrough designation for TransCon PTH. I guess, has anything changed in your thinking on whether you’ll apply for breakthrough designation? And maybe if you can just walk us through quickly some of the most important data points from the TransCon PTH study that demonstrate that it might have a substantial improvement over standard of care supplements?

What we are doing from a high-level perspective is that we’re trying to get this important treatment out to the patient as fast as possible. And this involve multiple interactions with regulatory agencies, how we can do that. And what we are, we just got the data out from some weeks ago, and we still are discussing that. And what we would like to do in a continued manner, update you when we get clarity about exactly what is the optimal pathway forward to get this product as fast as possible out to the patients.

Okay, thank you so much.

Thank you. And our next question comes from David Lebowitz with Morgan Stanley.

Thank you very much for taking my question. When patients are titrated on to their, I guess, ultimate dose, how long do you think it might take until they ultimately get stabilized, with respect to urinary calcium?

That is a question we will hope to get much more evidence on doing the trial. But I think you will see a period of time where you, for example would have a patient that have not seen PTAs for potential 8 years to 10 years. They will have a calcium deposit that is very different compared to a normal person. And there will be a transition state, which can take months, perhaps 3 months to 4 months, where you will see a net loss of calcium from the body. It can also be soft calcification it’s coming from. And you will see that happening in this period of time. So when we’ll be basically coming to the 6-month point, I actually believe it’s a great point because this is where we basically believe that we will see the best stabilization of the patient where you incorporate elements like also having sufficient long time with a normal bone turnover. And by doing that, you will have a much more regulated natural hemostasis of the calcium metabolism in the body.

Thanks for answering my question.

Thank you. Our next question comes from Josh Schimmer with Evercore ISI.

Great. Thanks for taking my question. I would like to come back to the oncology portfolio, and maybe ask a little bit of a leading question. I think historically, dose-dense chemo has generally reduced toxicity and improved outcomes in oncology, even with traditional chemo agents. And the TransCon platform would seem to be uniquely capable, essentially delivering dose-dense chemo, either traditional chemo agents or the new targets that you’re pursuing, either alone or potentially even in combination. So as you’re kind of thinking of evolving the portfolio, deepening it? Maybe you can give us a sense for what direction you may be headed in and whether kind of the dose-dense chemo successes of the past or potentially avenues that Ascendis can pursue?

When we look on the landscape of product opportunities we have in oncology, it’s huge. And when we look on the technology platform we have available, we have two discrete technology platform. Something, a platform that can localized injection inside a tumor and keep it up for 2 months, 4 months, 6 months, everything from a cytokine, from an antibody, from a small molecule and even a inside a tumor or anything like that, even the full-linked antibody fragmented and [indiscernible] and then to what we call the soluble platform where we basically can avoid any kind of [indiscernible] but have a constant low level release of a compound, which could have a huge availability across a lot of both antibodies, but also small compounds like [indiscernible]. And this is where we build up the pipeline. And currently now, we only restricted on one single thing. How fast we can take one IND or two IND into oncology development every year. And this is the flow we will see coming in. And I 110% follow your thinking.

And then, Jan, to your point, you could, in theory, choose almost anything, correct? And in theory, you could improve outcomes by essentially recreating dose dense with everything you choose, either again, monotherapy or combo. So how do you target this? And how do you do it with finite resources?

This is a great question. And this is where we really spend a lot of time on thinking is, what is the best opportunity for bringing most value to the patient in this regard. And definitely, the manual is extremely, extremely long. And this is also what we are really spending a lot of resources on. We have the dedication now for the two first. We have the two next being aligned on. We have two more. So basically, in our entire way of operating now, we are building up the pipeline again and again. And I actually think that is a great question because there is many more opportunities than we basically have capability to do.

Looking forward to seeing where you take the portfolio. Thank you.

Thank you. Our next question is from Alethia Young with Cantor Fitzgerald.

Hey guys. Thank you for taking my question. Congrats on all the progress with PTH over the quarter. I just wanted to ask about kind of dynamics of people taking vitamin D and calcium. And is there a possibility these data get more robust as time going on and people kind of get really comfortable that TransCon is truly a replacement therapy, is my first question?

I agree. I think when people see the data, get the story, hear the side, how we’re really getting treated, that will definitely be much easier to be titrated of standard of care, because they have now seen the clinical evidence that TransCon PTAs basic is a replacement therapy. A hormone replacement therapy, you’re missing PTH, you get it back. This is what we’re doing. We are creating a system where we basically are a replacement hormone replacement therapy. And I would compare it to being in a position that we basically have type 1 diabetes without insulin. Today, we have PTH deficiency, without PTH that can be restored in a physiological level. And that is the paradigm change being now. And people will see the results. We’re coming out more and more. And I actually believe that it will be much, much easier for people to understand the real benefit – if we saw it during the trial, when the first solver experience for the patients in the beginning, it was so much easier to get the patients in.

And just a follow-up, I guess, psychologically from the patient perspective, I guess, when I think about the extension data, do we think there’s a possibility that like it’s better because basically, that people get more and more comfortable with perhaps really going down to zero on vitamin D and calcium because they are having an overall good experience and obviously just getting comfortable. Is that a fair read?

I think in the intervals, some kind of psychology to move the last kind of calcium supplement. And we think that it’s improving with the improved experience – treatment experience, explaining data about our treatment of PTH. We definitely expect to see that.

Great. Thank you very much.

Thank you. And our next question comes from Jim Birchenough with Wells Fargo.

Yes hi guys. Congrats on all the progress, not common to see time lines actually improve during [indiscernible] so congrats. Just on the PIP, maybe set expectations for what you’re hoping to see around those discussions in – would be a good outcome and how we’ll hear about that, maybe, just to start off with?

Yes. Well, what we had relayed before was that we’re in the middle of the process with them. We received encouraging information in January when they completed their assessment. And they requested some additional information that was fairly straightforward and didn’t include anything we weren’t already doing in the program. And so we responded to that at the end of March, they informed us that the process started. And it’s a little bit not very transparent to us right now, is they’re within discussions, and we expect to hear their assessment at the end of June. We are moving towards receiving an approved PIP. I think that, that’s the way everything is pointing right now don’t really know until the end. All the other long-acting compounds had received waivers, which was a recognition of some concerns related to long-term benefit risk in children. But so far, the tea leaves don’t seem to indicate that for us right now.

And just as a follow-up, sticking with the growth hormone side of things. I’m not sure if Jesper is on the line, but if he is, I’d love to hear his thoughts and maybe, Jan, you could echo what he would say, and that is, what are the main barriers to making TransCon growth hormone a commercial success, is there some inertia or some dynamics that you’re thinking ahead towards in terms of commercialization? Thanks.

Hey Jim, what we have done is that Jesper will be joining us here in our August or where we expect to have our Q2 call. And I think he will give great feedback to you about his 20 years’ experience in growth hormone era and also building a brand, which we both know, up to the leading brand. And I think and I hope we will see Ascendis Pharma also will be in this position 1 day.

Terrific. Thanks, Jan.

Thank you. Our next question is from Tiago Fauth with Credit Suisse.

Hey guys. I just have a quick question on ACcomplisH. I was actually curious if you could give us a sense of the number of patients dosed to date or which of those cohort you might be right now? I’m just – I know there’s some uncertainty but trying to get a better handle of the time lines. If that’s not possible, at least what’s the length of follow-up that you’re dosing to help patients in each cohort before the data monitoring committee allows for dose escalation into the next cohort just trying to get a better handle of that? Thank you.

Yes. So what we are doing in this trial, every time when we have 3 months for a cohort, we basically have a safety meeting and efficacy meeting, where there is a group that unblind the data and look on the data and then they are making a recommendation to move forward to the next cohort. And that is what we really are going through now. And what we have done, in addition, we are on track to also initiate our second Phase 2 trial, what we call ACcomplisH China, where we will have potentially more than 100 children ready to be moved over to what we call the active dose that we will have at that time. And it basically will enable us to have two independent Phase 2 trial with more than – potential up to more than 150 patients both of them double-blinded, placebo-controlled, so we really can have an optimal evaluation of efficacy and perhaps much more important, safety. And this is where the packet that we be developing now. And remember, this is done to children of age of two. So this is really where we want to do the treatment as early as possible.

Got it. Thanks a lot.

Thank you. Our next question is from Adam Walsh with Stifel.

Hey guys. Thanks for taking my question. My first one is with respect to the open-label extension for TransCon PTH, you previously talked about remote nursing visits with respect to collecting the urinary and serum calcium. Is that still the case? Are we seeing patients return to more standard kind of health care site visits? And if it is still the case, how smooth a process has that been with respect to being able to collect the data – all the data necessary?

Well, we’re still sort of seeing that evolve right now. I think that according to the latest communications with the trial folks, there’s still some sites that are somewhat restricted in terms of patient access. But so far, with the visiting nurse scenario that we’ve been able to use, it’s been pretty successful, to be able to do these somewhat remote visits for a significant portion of the patients, not the majority, but a significant – we’ve had almost no missed visits. So 1 way or the other, we’re getting these data in. So – but I can’t tell you right now whether there’s been a significant move back to normalcy just yet in some of these places.

That’s helpful. And then 1 quick one, it’s a follow-up to the launch for the growth hormone. And I recognize that Jesper’s not there yet, but I just want to get some general thoughts around the launch in 2021. Given the unknowns around COVID and the potential for the effect to kind of wax and wane, perhaps over time until we have a vaccine, what might that mean for the commercial launch strategy? And what contingency plans are you making in terms of recognizing that the launch may have to be nontraditional? I guess what can you do in a COVID environment to ensure a maximal impact on that launch? Thank you.

That is exactly the question which we have been dealing with in – for the last period of time. So we are, basic, as we do in other parts of our operation, ensuring that we’re basically building on the flexibility, that ability for really living in the new changing circumstances. And that is what we also are enrolling now in exactly in our long strategy, which I actually believe most other companies also doing currently. So I think what you will see, you will see how we – as we did in always of our operation, adapting really fast to the circumstances, and we will do it exactly into the long strategy. We are dedicated to get this product out to as many as possible of the patient as fast as possible, and we were quite sure we will get it done.

Great. Thank you.

Thank you. Our next question is from Liana Moussatos with Wedbush Securities.

Congratulations on your progress. I have a couple of questions for Scott. €75 million OpEx in Q1, how should we think about Q2, Q3, Q4 and what’s the cash runway?

Thanks, Liana. Yes, I think that, that’s – using the Q1 OpEx is probably a good base to start from for building out a model for 2020. We’ll have, as I think you know, some increasing costs throughout the years, including advancing oncology. But as we said on the prepared remarks, the PPQ batches are falling off with regard to TransCon growth hormone. On the cash runway, so previously, we’ve said we’re comfortable through the launch of TransCon growth hormone. I don’t see any specific reason to change that.

Thank you.

Thank you. [Operator Instructions] Our next question is from Joseph Schwartz with SVB Leerink.

Hi, congrats on the progress as well. Just to follow-up on Adam’s question. I was wondering if you could expand a little bit on how endocrinologists – how you see endocrinologists managing growth hormone deficiency in an environment where they might have restricted bandwidth and how you’re anticipating being able to titrate patients to the optimal dose of TransCon hGH, if we do get a so-called second wave, and the environment could be challenging once again for managing patients?

There was multiple aspect of to your question. And when you think about how things are getting changed now in the current environment here in the U.S. in, for example, or a region like Denmark and Germany, basic, everyone is back in the normal way of living. So if you take part of the U.S., which are highly affected, there will be areas where you basically are talking with the physicians in the same way that your physicians are talking with the patient to a Skype-arranged talking or other element of interaction. And that is basically what you see that medical affairs, everyone changing over to instead of having hospital visits, they are planning to come with their communication, information about how our product will be in a different manner. And this is how typically you will see a lot of things adapting. When you think about growth hormone deficiency and treatment, I don’t think there will be any difference between our product and data growth hormone related to how often you ever will measure IGF-1 or how you either will titrate them, because both of them are basically function in the same way, except that there is a big difference. You take 1 every day, the other 1 you take once a 1 week, and you have a better efficacy or superior efficacy in growth velocity with our product. But basic to the titration, and how we’re getting taking, there’s basically no difference. So what we will see, that will not be other extra channels with our TransCon growth hormone, compared to what you will see with daily growth hormone.

Okay, great. And then on the TransCon CNP program, I was hoping you could just give us some more of an update on the status there in terms of IRBs and site activation and what the time line to generate some data in achondroplasia could be?

I think the time line is exactly about how we have disclosed it before. If I really can predict what is the best active cohort, I should potentially get a different job, but I cannot get that. And my idea is that we need to go to the different cohorts. And when we – some way are in acceleration that we think that we don’t want to do dose escalation more, we feel that this a time to stop it. What we will like to do is that we are hopeful that we are – with our second Phase 2 trial, the China ACcomplisH, we’ll be in a position that we can roll them over to the optimal effective dose. And what we have publicly said that we expect to initiate the Phase 2 trial end of this year in China ACcomplisH.

That’s really helpful. Thanks. And then can you just talk a little bit more about, like, what the biomarkers or other metrics that you’ll be looking at in order to determine what the optimal dose is?

There is a series of biomarker you can look at. What some of the element you can do, the most simple form which are very, very fast way to look at is, the expansion of the growth plate, which you basically can see, are there have really an expansion of the growth plate. Then you can obviously see high velocity which should be possible if you have sufficient effective compound already to measure that after three months. [indiscernible] that is specific PD markers that need to be validated. We still have a part of validated and never be validated to the Phase 2 program, which are collagen specific to measure directly growth of the growth plate. So from that perspective is that we also have other elements like disproportionality. We have other co-morbidities. We also have the active program we’re running. So I think there is a series of, you can say, co-morbidities and elements that we’re analyzing in the trials.

Great. Thanks for taking my questions.

Thank you. Our next question is from Leland Gershell with Oppenheimer. Please go ahead.

Hey good afternoon. Thanks for taking my question. Congratulations. Just a quick question for me on the oncology pipeline, as you announced the advancement of the TLR 7/8. I also wanted to ask about the other 2, your TransCon IL-2 beta/gamma selective and also the VEGF TKI, how should we think about those heading into the clinic? Could we see that next year for either of those? And would there be additional preclinical data we could see emerging from either of those candidates?

I think what we disclosed today is that there will be a disclosure of additional data related to two specific beta/gamma and Juha, perhaps you can tell about when that will be disclosed and basically a little bit about the overall content of the data that you expect to show.

Yes. So we are planning to present at the virtual AACR now in June, post the presentation on TransCon IL-2 beta/gamma, which will include preclinical data, both from mouse models and primate studies. We are looking forward to that presentation in June. We are moving forward into the IND with the TransCon TLR 7/8 Agonist program. Those studies are progressing well and are designing the clinical trial plans and expect to start those studies early next year. And we’re pursuing in parallel preclinical studies in the early pipeline as well as adding data to these more advanced programs.

But specific, your question is the IL-2, beta/gamma, as soon as the team has handled into the TLR 7/8 in the clinic, then they will immediately start on the other program, our TransCon IL-2 beta/gamma specific will happen in, I think, perhaps three to six months after the TLR 7/8.

That’s great. Thank you again. That’s very helpful.

Thank you.

Thank you. And this concludes our Q&A session and program for today. We thank you for participating, and you may now disconnect.