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Shares of the rare-disease drugmakerUltragenyx Pharmaceutical (NASDAQ: RARE) rose by over 14% in pre-market trading on light volume Wednesday morning due to a positive phase 3 data readout for burosumab, the company's experimentalX-linked hypophosphatemia (XLH)drug. As of 10:15 a.m. EDT, the stock had settled to a 8.5% gain.
XLH is an extremely rare but seriousgenetically based disease characterized by insufficient phosphate levels. These abnormally low phosphate levels can affect a patient's skeletal system, leading to other disorders such as rickets.Ultragenyx is co-developingburosumab with the Japanese drugmakerKyowa Hakko Kirin.
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Ultragenyx desperately needed a late-stage win withburosumab following its midstage miss with its experimentalglucose transporter type 1 deficiency syndrome drug triheptanoin (UX007) last March. In short, the company's valuation probably would have nose-dived ifburosumab missed the mark in its late-stage trial as well -- especially since some analysts have this drug's peak sales pegged at nearly $1 billion.
According to the press release,Ultragenyx andKyowa plan on discussing the drug's late-stage data with the FDA soon to hammer out the details on a possible regulatory pathway. Before investors get too excited, though, there are some lingering questions aboutburosumab's overall utility in XLH. After all, the drug did reportedly improveserum phosphorus levels in a meaningful manner (primary endpoint in the study), but the drug doesn't seem to offer much, if any, of a clinical benefit on the pain side of the equation (secondary endpoint; p=0.0919).
While Ultragenyx thinks that the totality of the data from both this study and another ongoing late-stage trial in adults with XLH will ultimately support an approval, the FDA has been known to shoot down experimental drugs for a lot less in the past. And this black swan-type risk factor is probably why the drugmaker's shares are struggling to maintain their momentum in early trading today.
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