Ascendis Pharma A/S (ASND) Q1 2023 Earnings Report, Transcript and Summary

Thank you for standing by and welcome to the Q1 2023 Ascendis Pharma Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session [Operator Instructions] As a reminder today's call is being recorded. I would now like to turn the call over to your host Mr. Tim Lee, Senior Director of Investor Relations. Please go ahead, the floor is yours.

Thank you, operator, and thank you everyone for joining our first quarter 2023 financial results conference call. I'm Tim Lee, Senior Director of Investor Relations at Ascendis Pharma. Joining me on the call today is Jan Mikkelsen, President and Chief Executive Officer; Scott Smith, Executive Vice President and Chief Financial Officer; Dr. Stina Singel, Executive Vice President and Head of Clinical Development Oncology; and Joe Kelly, Senior Vice President, Head of Commercial Endocrinology. 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 U.S. commercialization and continued development of SKYTROFA for the U.S. market, our revenue projects for SKYTROFA, the commercialization of TransCon hGH for the EU market, statements regarding the expected timing of approval – the expected timing of potential approval and launch of TransCon PTH in the U.S. market, statements regarding the expected timing of the potential approval of TransCon PTH in Europe, statements regarding the potential the market size for TransCon PTH, our progress and our pipeline candidates and our expectations with respect to their continued progress, statements regarding our strategic plans, our goals regarding our clinical pipeline, including the timing of clinical results, statements regarding our pipeline product candidates, statements regarding our ongoing and planned regulatory filings, and our expectations regarding the timing and the results of regulatory decisions, our expansion into new therapeutic areas and statements regarding our ability to create a sustainable profitable leading global biopharma company. These statements are based on information that is available to us today. Actual results and events could differ materially from those in our forward-looking statements. And we may not be able to achieve our goals, carry out our plans, our intentions, our expectations, our projections disclosed in our forward – or our 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 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 our forward-looking statements section in today's press release and the risk factor sections of our most annual report on Form 20-F, filed February 16, 2023. TransCon Human Growth Hormone or TransCon hGH is approved by the FDA in the U.S. under the brand name SKYTROFA for the treatment of pediatric patients one year and older weighing at least 11.5 kilograms and having growth failure due to inadequate secretion of endogenous growth hormones. In addition, the European Commission has granted a marketing authorization for SKYTROFA to Ascendis Pharma developed under the name TransCon hGH as a once weekly subcutaneous injection for the treatment of children and adolescents aged 3 to 18 for growth failure due to insufficient secretion of endogenous growth hormone. In general, we refer to this product as TransCon growth hormone, unless we're referring to the product in the context of particular jurisdictions such as the United States or the European Union. Otherwise, please note that our product candidates are investigational and are not approved for commercial use. As investigational products, the safety and effectiveness of the product candidates have not been reviewed or approved by any regulatory agency. None of the statements made on the conference call regarding our product candidates shall be viewed as promotional. On the call today, we'll discuss our first quarter 2023 financial results and we'll provide further business updates. Following some prepared remarks, we will then open up the call for questions. I'll now turn the call over to Jan Mikkelsen, President and Chief Executive Officer. Jan to you.

Thanks, Tim. Good afternoon everyone. Ascendis continues to execute on the strategy we have laid out in our Vision 3x3 and our commitment to improve patient lives by building a sustainable, profitable leading biopharma company. Based on the strengths of our clinical data for TransCon PTH, including the positive feedback from patient and their physician and the significant unmet medical needs of patients living with hypoparathyroidism, we remain convinced that TransCon PTH can be approved and become an important new treatment option. We remain dedicated to working with FDA to bring this product to the U.S. market as quickly as possible. And we are on track in EU with an expected regulation regulatory decision later this year. In the U.S., our PDUFA date of April 30, 2023 is coming up and we expect to get feedback from FDA soon on the next steps forward. In heiGHt there are multiple possible scenarios. Our team is well prepared and our belief in the provability of TransCon PTH in the U.S. is unchanged. We launched Skytrofa with a commercial strategy built on this product strength with the goal of making it the leading product in value in a growing growth hormone market. With this product, we believe that it is more and more clear that Skytrofa is on track to become the U.S. market leader in value in a growing growth hormone market and a blockbuster product. We believe the success of Skytrofa we are seeing now is driven by the following three factors. First, treatment experience. Many physicians have now had patients with 12 months real-world experience with Skytrofa, the time period that is necessary to observe an improvement in linear growth and other endocrine benefits. Second, consolidation of daily growth hormone market. This consolidation started three, four years ago when daily growth hormone companies began to realize that their existing daily product will be phased out with time when once weekly treatment came to the market. We saw daily growth among companies reduce investment and optimize the business in this phase out period. We believe the current supply challenge of daily growth hormone products are a consequence of this with further support the uptick of Skytrofa. Third, Ascendis dedication and investment in endocrinology. We are investing in building relationship with physicians, patients, caregivers, providers with our investment in a dedicated commercial organization and medical affairs team supporting our endocrinology efforts. We also building a robust supply chain for Skytrofa indicating to patient, physician and providers that we are a trusted partner with a solid supply chain. As a result, first quarter 2023 Skytrofa revenue grew to €31.6 million. Based on the algorithm we described earlier this year for 2023 outlook using first quarter sales of €31 million and our goal of adding as many new reimbursed patient in 2023 as we did in 2022, we now expect full year 2023 Skytrofa revenue between €150 million and €160 million. Our revised outlook for 2023 provides a new higher foundation for 2024. We are pushing global market leadership for Skytrofa to geographic expansion and potential label expansion. The Skytrofa commercial launch in Germany is on track for the third quarter of 2023. In the fourth quarter we expect top line results for the Phase 3 foresiGHt trial in adult growth hormone deficiency, which is designed to demonstrate the impact of Skytrofa on body composition in adult patients, the growth hormone deficiency. Turning now to TransCon PTH. As I mentioned at the start of today's call, we are dedicated to get TransCon PTH to patients suffering from the serious health and quality of life issues caused by hypoparathyroidism. And we know that the patient community share our goal. We continue to be excited about the potential TransCon PTH could have on addressing the significant unmet medical needs of hypoparathyroidism patients. The open-label extension of our Phase 2 path forward and Phase 3 PaTHway trials for TransCon PTH are ongoing with 145 of 154 of the original clinical trial patients continue on treatment with TransCon PTH for now up to three years. In addition, in the U.S. our Extended Access Program continues to enroll new patient every week. In Europe as previous announced, we received the comprehensive Day 120 response from the European Medicines Agency and we are very pleased with the feedback. We anticipate a decision on our M&A during the fourth quarter. And if approved by the EC we expect to launch in Germany in early 2024, levering our status, commercial infrastructure. We also applied to initiate an early access program for TransCon PTH initially in Germany. Approval for this program, we expect to indicate and enrol the first patient in Germany this quarter. Moving to achondroplasia, TransCon CNP. Our clinical data and positive physician feedback continues to differentiate TransCon CNP and reinforce our conviction that it has a potential best-in-class product profile in the four key pillars of drug development, safety, efficacy, tolerability and convenience. More importantly, we believe TransCon CNP also has a beneficial effect on achondroplasia comorbidity besides promoting increased linear growth. We believe that is why all 57 patients who started in our Phase 2 ACcomplisH trial remain in this open-label extension. Later this year, we will have an R&D event focused on TransCon CNP to share new clinical data and the science that we believe support is best-in-class profile. Switching to oncology, we have two programs moving ahead with recommended Phase 2 doses in specific indication. TransCon TLR7/8 agonist and TransCon IL-2 beta/gamma. Next month in May, we will hold an oncology R&D event in New York around ASCO to give you an update on these two important programs. At this event, Ascendis and key opinion leaders with experience in our clinical studies plan will share key data from the dose escalation portion of our two first-in-human trials. Finally, as I said before, we are managing our business for long-term value creation and continue to aim to achieve cash flow like even without the need for additional dilutive equity financing. I will now turn the call over to Scott for financial review before we open for questions.

Thank you, Jan. I will quickly touch on a few points surrounding our financial results. For further details, please refer to our Form 6-K filed today. As Jan noted, SKYTROFA revenue for the first quarter of 2023 was €31.6 million. Revenue in Q1 would have been €1.4 million higher, excluding a negative foreign currency impact compared to the fourth quarter of 2022. Total revenue was €33.6 million including SKYTROFA revenue as well as license, clinical supply and services provided to third parties primarily VISEN Pharmaceuticals. During the quarter, we continue to demonstrate our cost discipline offsetting seasonally higher employee costs in Q1. Total operating expenses were €173 million for the first quarter, up 5% sequentially from the fourth quarter of 2022. Overall R&D costs declined 2% sequentially, primarily driven by lower endocrinology related costs partly offset by an increase in oncology related costs. SG&A expenses grew 18% sequentially, primarily due to increased support for SKYTROFA commercialization and pre-launch activities for TransCon PTH. Overall, our operating loss declined sequentially by 3% to €144 million for the first quarter from €147 million in the fourth quarter of 2022. Our main 2023 commercial product manufacturing campaigns which are capitalized rather than expense are expected to be completed in the first half of 2023, which would further reduce cash expenses in the second half. Finally, we ended the first quarter with cash, cash equivalents and marketable securities totaling €586 million. Based on Q1 results, we are on track to exceed the current Ascendis compiled 2023 consensus estimate of €98 million for SKYTROFA. Using the algorithm as Jan laid out in his remarks, SKYTROFA revenue is expected to reach €150 million to €160 million for full year 2023. Supporting our goal of achieving cash flow break even without additional dilutive equity financing, we are implementing additional cost controls and productivity improvements, which we anticipate will be realized starting in Q3 and beyond. Let me now also provide an update on selected key 2023 corporate milestones. For TransCon growth hormone, we are on track to launch SKYTROFA in Germany in Q3 and we expect to report top line data from the global Phase 3 foresiGHt trial in adult GHD, our second indication in Q4. For TransCon PTH in the U.S., our PDUFA date is April 30, so we expect additional clarity on our NDA application in the coming days. We expect the European Commission decision in Q4, if approved, we plan TransCon PTH is our second product launch in Germany in early 2023. For TransCon CNP, we are on track to complete enrollment of the Phase 2b ApproaCH trial in achondroplasia in Q2. And later this year, we will share long-term follow up data from patients on 100 micrograms from our open-label extension of our Phase 2 ACcomplisH trial. Within our oncology therapeutic area, as Jan mentioned in his remarks, we'll host a research event on May 31st in New York to review the science underlying our oncology portfolio. Review initial data on TransCon IL-2 beta/gamma and hear from KOLs who have clinical experience with both of our oncology product candidates. As you know, the PDUFA date for our NDA for TransCon PTH is this Sunday April 30, and we expect to receive a response from the FDA by then. Given the proximity to the PDUFA date for the NDA for TransCon PTH, we will not be providing additional details regarding this NDA at this time. With that operator, we are now ready to take questions.

Thank you. [Operator Instructions] Our first question comes from the line of Jessica Fye of JP Morgan. Your line is open.

Great. Good afternoon. Thanks for taking my question. I know it’s difficult to comment in advance of the PTH PDUFA, but at a minimum can you just say if you now know the deficiencies that the FDA has regarding the PTH NDA? I believe those were not previously outlined in the letter. Do you know them now?

I can say no to your question and have no further comments.

Okay. And then when you talk about managing the business to achieve the goal of cash flow breakeven without the need for dilutive equity financing, can you elaborate just on like what your expectations are for PTH that are kind of embedded in that breakeven assumption?

It’s a – we are dealing with a lot of different scenarios because as we indicated before, we do not know the exact nature of the deficiency. And we are working with what we call the best case and worst case. We are looking at on our Vision 3x3. We want still to fulfill that. We want to build up a leading biopharma that both sustainable and profitable. We can continue to this. So from our perspective is that we are taking into the assumption we are launching SKYTROFA in Germany here in Q3. We are taking into the assumption we are launching TransCon PTH in Germany and Europe to different system in beginning of 2024. We are building that SKYTROFA in the U.S. is going to the assumption we have laid out in 2023 and will continue that growth in 2024 and even from the worst case to the best case, we can get the two things together and still fulfill our Vision 3x3.

Thank you.

Thank you. [Operator Instructions] Our next question comes from the line of Tazeen Ahmad, Bank of America. Your line is open.

Hi guys, good afternoon. A couple of questions if I can on GHD. You’ve issued sales guidance for the year, I think as recently as the beginning of the year. You might have been more tentative on that prospect. I guess what’s changed during the quarter to I guess number one make you feel confident that you can project out the rest of the year. And can you tell us some of the major drivers you took into consideration when putting together the sales guidance such as perhaps switch rates versus new patients starts and any assumptions you can share on compliance would be great as well. Thank you.

Thanks for the question. We’re feeling much more confident now when we go to a Q1 because now we accumulated on top of a big sum that is a mathematic algorithm even I can understand without an MBA [ph]. So the duration is very, very simple. You have 31 million here in Q1. We have seen and our experience for many months we have with SKYTROFA, we are not basic – not losing patient. So if I’m multiply the 31 million with 4 times and then we just add the same amount of new patient as we did in 2022 are getting exactly to this number 100 and between 150 and 160, I think it’s a very simple agreement built on solid number and this is exactly why I feel I can stand in for this year. I have everyone in the senior organization to sign on for this. So we feel confident that we can fulfill this. And this is why I’m feeling, we will come up with guidance when we feeling we can give you reliable guidance that you can use in the modeling. So you’re feeling that – we feeling that we give you a number that we can stand in for.

Thank you. [Operator Instructions] Our next question comes from the line of David Lebovitz of Citi. Your line is open.

Well, thank you very much for taking my question. When you look at SKYTROFA into the rest of the year and then dramatic growth you’re expecting, how should we look at that in the U.S. versus Europe?

The guidance we are providing to you is only reflecting U.S. sales. We have not given you a guidance related to Europe. There will be on top of that.

I got it. And I guess could you just remind us of when we can expect the next TransCon CNP updates and what your expectations are going into that?

The update we will provide for you, as we indicated here in when we come to the beginning of the fall, likely in Q3, we will host and research event in New York as we do now in oncology here in May, where we will go through the signs behind the CNP. Because I think sometime, it’s getting forgotten that every product has its own mode of action. It signs and the signs and decides the clinical outcome he will get and how to understand the clinical outcome. We have always said we are not here for just addressing linear growth. We are here for addressing the key element of what a treatment for [indiscernible] need treatment of comorbidities and that is what we always have been focused on. And I believe we at that research event can give you the data, the signs behind the data that really can give you the way we are thinking and believe that we building up in best in class product opportunity in this disease era.

Thanks for taking my question.

Thank you. [Operator Instructions] Our next question comes from the line of Paul Choi of Goldman Sachs. Your line is open.

Hi thank you and good afternoon and thanks for taking our questions. Jan and team, I guess, one question that investors have with regard to PTHs. As you think about the – your earlier statements where you expect clarification from the FDA shortly. Have you – since the call that you held a few weeks ago provided any additional data updates? Or have there been any other requests from the agency?

I think we need to refer to the statement that Scott clearly wrote up that we will not comments further on any interaction we have of FDA at this time.

Okay. And then on the commercial side with regard to the European launch for growth hormone, can you maybe comment on any preliminary discussions you either have had with IREG or GKSV and just kind of how to think about the reference pricing versus the potential reference pricing in Germany versus some of the other available products in the category?

I believe the dynamic we saw in U.S. and how we tackled in U.S. is exactly happening in the same way in Europe. That is established daily growth hormones that have the same issue that they have here in the U.S. We will come in with a treatment regime that is superior for the patient and I believe we will have the same responsible superior pricing that we do in the U.S. also in Europe.

Okay, thanks. I’ll hop back in queue.

Thank you. [Operator Instructions] Our next question comes from the line of Li Watsek of Cantor. Your line is open.

Hey, thanks for taking our questions. I guess can you provide maybe some guidance on the OpEx side? I mean, I guess starting in Q3 given that you may have a delay with TransCon PTH and you mentioned earlier that you have a focus on cost control. Maybe help us understand how should we think about OpEx going forward. And for the early access program in Germany, how many patients are will be eligible for this?

Yes, let me take the last question first and because the program in Germany where we start in Germany where we have applied for an approval for initiated is different compared to the U.S. program because it’s electable for both all patient with Hypopara and not as for U.S. is highly restricted to patient that basic is highly PTH experience. So it would be a most broader program. The dynamic is also there – different, because for example the program is terminated automatic the day you’re getting approval and the patient is automatic conversed over to reimburse patient. So it’s a different system than you actually have in the U.S. system. So this is why we will some way give access to the patients that is the same unmet medical need that is a series of patient multiple hundreds of patient on Natpara today then know that under highly restricted constraint because Natpara is disappearing in the beginning of 2024. So they want to have time to really changed this patient over to TransCon PTH. At the same time we opened it up for all other patients because there was some must and you can say strong desire from the treatment physician also to give it to patient that actually [ph] never have seen all PTH program before. So this is why it’s a different program. Going back to your comments about how we are some way of running the financials at Ascendis and I actually made it very, very simple in this way we have one bucket with cash in with other water and then we take something in every day and we can see we grow it and grow it, grow it now with U.S. SKYTROFA we will grow it with U.S. outside U.S. also revenue there and we always want to have a solid amount of water into this bucket, and we do that by basic ensuring that we run our business, optimizing our business, optimizing the way we perform our procedure, what function path for two years ago is not function today is not the most productive way to do it, this is how we adapt it. We are global company would give us a lot of benefit to really optimize our business in different means and that is exactly what we are doing to ensure we always will have enough water in the bucket to feel safe. If we start to be dry around us, we always have enough to drink.

Okay, got it.

Thank you. One moment please. Our next question comes from the line of Derek Archila of Wells Fargo. Your line is open.

Hey great. Good afternoon. Thanks for taking the questions. Just two from us. Jan, you mentioned earlier in the call, yes you’re that you’re not commenting on interactions with the FDA so is it fair to assume that you’ve had some interactions since the deficiency letter that you do not want to comment on? So that’s question number one. Question number two is, you’ve talked about this attrition strategy and the growth hormone market, so kind of expecting these competitors to exit the market maybe because it’s not profitable for them leaving you and maybe one or two other players in the market. So, I guess what catalyst needs to happen for this to play out and what’s kind of the timing on that? Thank you.

Yes, obvious. It’s easier for me to answer first question because that’s no answer. So going to the second question, which are really a high valid question, because it’s actually, I believe someone should write a textbook of what happening in the go-to-market here in the U.S. It was the first place you saw biosimilar having Teva [p] centers coming in. We saw how the entire market developed and now we coming to the next stage, the first thing the biosimilar going in, then it went over to market access, and I can guarantee we had so much interaction with nearly every one of the daily growth among company except one I think. And we someway got a really, really good insight in their thinking. And the insight is exactly how I also would act. The element is that when do you have a superior treatment coming into that basic, making a paradigm shift in the treatment regime, if you are sitting with the – what we call the established that cannot follow this treatment regime, it’s only how really to optimize your business at that time. So you followed the classical textbook, first of all, you get rid of the sales force, the second one, you get rid of all promotion, you get basic optimizing the manufacturing source the way you never invest in it. Then you terminate the manufacturing after you have a bulk product setting and then you’re just selling that and then you are out. And I can guarantee it’s one of the best P&L you can get out of that business. This is really where you have a great P&L. But the problem, this is not sustainable. Some of the daily growth hormone, you can find that out that try to sell it. No one wanted to buy a dying product. That was why no one can sell it. So therefore the entire consultation started three or four years. What you start to see now is the consequence of it and you likely write there will only be one or two daily growth hormone provider, because there will potentially be a cash segment, there will be other things where the potential will be an element of what we can call a low priced element where they don’t really need optimal treatment or anything like that. And this is where you typically will see one or two player be.

Thank you. One moment please. Our next question comes from the line of Leland Gershell of Oppenheimer. Your line is open.

Hey, good afternoon, and thanks for taking my question. Just another question on the SKYTROFA trajectory, obviously very healthy bump up from fourth quarter and wondering if you can comment, is that as excellent sites at the turn of the year, were there any aspects related to more favorable reimbursement with the New Year and or changing dynamics of the daily growth hormone space as you had talked about that may have favored SKYTROFA? Thank you.

I think we had the three pillars we discussed in my part of the script, which I actually think illustrated very well the transition becoming thing. And I believe when we first go to the first the treatment experience, it actually take 12 months by physician really to see the improved – really the improvement in linear growth and other endocrine benefits. And when you see a new product, I think often as a physician you will wait to see in a few number of patients before you expand further on. The second thing is the consolidation of the market, which sure is happening and there was just a consequence when they start [indiscernible], we know it’ll happening. But we didn’t know exactly when it will be. And I also believe, and this is where Joe comes in and will talk about how we investing in a dedicated best-in-class endocrinology dedicated salesforce and our medical affairs teams.

Yes, yes. So yes, the commercial team really has done a good job of executing in this particular market where we really disrupted at how growth hormone is prescribed and also reimbursed by the PBMs and the payers. And really it comes down to the clinical strength of SKYTROFA, it’s efficacy the fact that we don’t have a preservative, best-in-class autoinjector. And again, the support that we can provide the offices and the patient to get reimbursed. So that they can enjoy SKYTROFA for their entire course of therapy. But the compelling story that we do have from a clinical standpoint is really a motivating factor for these healthcare providers to do the appropriate documentation so that that patient can get approved and stay on our product.

Thanks, Joe.

Thank you. One moment please. Our next question comes from the line of Vikram Purohit of Morgan Stanley. Your line is open.

Hi, good afternoon. Thanks for taking our question. We had one on TransCon hGH. Could you just help us frame expectations for the foresiGHt data expected in adult GHD in the fourth quarter? And also speak a bit about how you’re viewing the commercial potential for hGH for this part of the GHD population versus the pediatric population? Thanks.

Really, really interesting way to look and why the adult growth hormone deficiency trial is so really interesting for us, is because we are in a situation where many of the other indication that were used growth hormone, use linear growth as the primary outcome. Here in adult hormone deficiency, the primary endpoint is built on change in body composition, which are also one of the element you want to achieve in the pediatric population. But it’s not really the primary endpoint. What we also have, we have consideration where we have a benchmark related to the daily growth hormones. We have a benchmark related that both the two other long-acting have indicated Phase 3 trials have reported, Phase 3 trials in adult growth hormone deficiency. One of them didn’t manage to be better than placebo. The second one showed half of the effect compared to daily growth hormone. We believe because SKYTROFA is built on somatrope and unmodified molecule that can have the same mode of action like data growth hormone and endogenous growth hormone. We will be in a position that we hope at least we can see the same benefit as data growth hormone. Potentially we will be superior as we were in consideration in the pediatric, but we will wait to see the data. So we believe that it is a really, really strong integrated packet to see because it's first time where you really go out and analyzing really the impact on a growth hormone treatment on the endocrine health, which body composition is part of it, but is really parallel to some of the other benefit where you need to have the distribution throughout the body.

Thank you. One moment please. Our next question comes from the line of Joseph Schwartz from SVB Securities. Your line is open.

Hi, thanks very much. So how leverageable is a sales force across three endocrine indications you're currently pursuing. I know when we look for physicians to speak on these topics, it seems a bit fragmented to us and we almost never find anyone who can speak on two, never mind three of these endocrine conditions. So can you just talk a little bit about how the sales force is currently structured and whether you won't have to actually expand it significantly in order to reach achondroplasia and hypoparathyroidism specialists in addition to growth hormone folks?

Yes. This is the holistic picture. You basically are saying why did we focus on building up as really, really a strong pipeline of three independent products really focused on endocrinology. So the first one we have is SKYTROFA. It both have a pediatric and adult indication. We have pursued the pediatric now we go for the adult. We have TransCon PTH, the main indication is adult, but they also have a pediatric. We are going now, as I said before we expect to get an approval in what we call the adult hypoparathyroidism as soon as we get the feedback, what is the deficiencies? When we know what the deficiencies is, we can address it and this is what we will do extremely fast and ensure this product going out to the market. We will also pursue the pediatric indication in this segment. Then we have TransCon CNP, and people believe this is pediatric disease because they're just focused on linear growth. We believe that basic is a treatment regime for achondroplasia also rest of their life. And this is one of the things we also will like to discuss when we come to basic the research state. So when you see the holistic part on it, yes it gives us a lot of synergy specific when you think about reach out, we go to into. We have one strength, people come to us perhaps interest in PTH, perhaps interest in CNP, perhaps interest in growth hormone and to get the entire packet. They see endocrinologists, they physician, they see us dedicated to be a leader in endocrinology because we so much focused on all different product opportunities. When you go to dedicated sales force, you can build it up in different means and it's very much dependent on geographic regions. If you just think about U.S., I actually think what Joe and his team have done. They're actually building up what we call sales force that basically are dedicated to SKYTROFA, dedicated to PTH, but the basic can exchange it back and forth between the different sales force because both have all the capability to be in this way. So I have to believe that we have so much synergy in this way of operating.

Thank you. One moment please. Our next question comes from the line of Andreas Argyrides [Wedbush]. Again Andreas Argyrides, your line is open.

Yes. Good afternoon. Thanks for taking our question. A quick one here on the TransCon CNP. So looking at the growing achondroplasia market and the competitive landscape, could you expand on what data you are tracking and plan to provide to support TransCon CNP impact outside of high [ph]. Did you see a potential to expand into patients or children under two years old, and forgive us if that was already addressed?

No, I believe that is some way, what we want to do is that you have linear growth, which an element where we believe sure, we can help a lot. We can do a lot when we can also potential accelerated in a combination between SKYTROFA and TransCon CMP. The element of what we call achondroplasia-specific comorbidities. And in the presentation, we did when we released our contest data, we basic indicated that we couldn’t see an effect on the achondroplasia-specific side effects meaning is that regardless. We are building on that and we have regulatory interaction, how we potentially can prove that in a more clinical specific manner in our Phase 2b, which we hope is our pivotal trial, that we basic are recruiting now for full speed and hope to have all patient in this quarter here. So this is where we see the element of us providing and treatment of achondroplasia really to ensure that we are not only correcting linear growth, but also addressing the comorbidities.

Great. Thanks for taking our question.

Thank you. [Operator Instructions] Our next question comes from the line of Yaron Werber of Cowen. Your line is open.

Hi, this is [indiscernible] on for Yaron. Thanks so much for taking our questions. Historically, I think you’ve held this Q1 call in early May, and I think some investors were maybe thinking that the call was moved up this time to get ahead of the PDUFA date and that we might get an update on the deficiencies. If you could just help us understand this a little bit more, that’d be helpful. And then just quickly, secondly, I know you’re not able to comment that much, but just given the lack of interactions it seems with the FDA, are you expecting a CRO. And if that does happen, how quickly do you guys think you can refile? Thank you.

Let me take the last question as I said before, we have no knowledge about the deficiencies and we cannot comment further on anything of regulatory interaction related TransCon PTHs and [indiscernible] and I actually believe what we illustrate to optimize processes, optimize processes to think, to do things smarter and faster. And I actually think, I give all the credit to Scott, it’s not often I do that, but I will actually give him credit to Scott, Mads, the Head of Finance that is sitting here beside us today too. And they can tell about how they really have optimized all our financial process. So we’re, I think, but we’re just pressing a button and then we get everything finalized. Scott, Mads.

Yes, so just as we reported earlier for the annual report will now report earlier for the quarterly report. So, I would say nothing specific to look into it. In fact, if anything, I think next year we’ll probably report the annual even earlier, right Mads?

31st of January.

The 31st of January next year.

I hope to answer your question. It’s just because we increase productivity and do it faster.

Okay. Thank you so much.

Thank you. [Operator Instructions] Our next question comes from the line of Caroline Palomeque of Berenberg. Your line is open.

Hi, good afternoon. Thanks for taking the question. So were there any material differences in the MAA application in Europe versus the MBA application in the U.S.? Given that, to my understanding, there hasn’t been any feedback from the European Regulatory Agencies. And then a second question is just a follow up on expenses, just given the updated SKYTROFA revenue guidance. Do you also anticipate adjustments in SG&A expenses such as in sales force? Like will you add any more people and I’ll stop there? Thanks.

In our regulatory finding between the different regions Europe and U.S. is basic built on exactly the same data packet that will be filed both places with sure, there is a different formatting of a different filing because there need to be made in a different format. But the data is exactly the same for both Europe and U.S. And related to the last question is a clear no.

Great. Thank you.

Thank you. I’m showing no further questions at this time. Ladies and gentlemen, this does conclude today’s conference. Thank you all for participating. You may now disconnect. Have a great day.