RARE stock is moving higher on January 10, 2020, after a Piper Sandler analyst said the clinical trial data was surprisingly positive.

Piper Sandler analyst Christopher Raymond says Ultragenyx Pharmaceutical issued a “surprisingly positive” update for its DTX301 gene therapy program. While it seemed expectations for the data were lowered after an additional prophylactic steroid treatment cohort was added to the study earlier this year, yesterday’s update for Cohort 3 in the ongoing Phase 1/2 study “knocked it out of the park,” Raymond tells investors in a research note. Two of three patients in the highest dose cohort responded to treatment, and the third patient has been deemed a potential responder, plus an additional patient from Cohort 2 responded, adds the analyst. The update removes “any sort of” overhang to the DTX301 program and the gene therapy franchise, he contends. Raymond remains a buyer of Ultragenyx and continues to like the stock’s setup. He has an Overweight rating on the name with a $70 price target.

On January 9, 2020, Ultragenyx Pharmaceutical Inc. (NASDAQ: RARE), a biopharmaceutical company focused on the development of novel products for rare and ultra-rare diseases, announced topline positive safety and efficacy data from Cohort 3 and longer-term data from Cohort 2 of the ongoing Phase 1/2 study of DTX301, an investigational adeno-associated virus (AAV) gene therapy for the treatment of ornithine transcarbamylase (OTC) deficiency. In Cohort 3 (n=3), there were two confirmed female responders as well a third potential male responder who requires longer-term follow-up to confirm response status. In Cohort 2, one female patient has newly demonstrated a response starting at Week 52 which was confirmed at Week 78. The two previously disclosed responders in Cohort 1 and Cohort 2 also remain clinically and metabolically stable at 104 and 78 weeks, respectively. Across all nine patients dosed in the study, up to six patients have demonstrated a response.

“We are encouraged to see a more uniform response at the higher doses including three female responders. To date, three patients in the study have discontinued alternate pathway medication and liberalized their diets while remaining clinically and metabolically stable,” said Eric Crombez, M.D., Chief Medical Officer of the Ultragenyx Gene Therapy development unit. “We are moving to prophylactic steroid use in the next cohort as we believe this could further enhance the level and consistency of expression that we have demonstrated so far.”

Cohort 3 Efficacy Summary (as of December 9, 2019 cutoff date): One complete responder, one responder, and one potential responder

Patient 7 (complete responder, female):
Patient 7 demonstrated a clinically meaningful 79 percent change in rate of ureagenesis, from a low of 24 percent of normal at baseline to the 51 to 64 percent range, and staying at 44 percent of normal at Week 52. During this period, she reported feeling significantly better and discontinued her alternate pathway medications and liberalized her protein-restricted diet. She has remained clinically and metabolically stable without a rise in ammonia.

Patient 8 (responder, female):
Patient 8 demonstrated a significant and consistent 90 percent reduction in ammonia levels, time-normalized over a 24 hour period, from a high of 184 umol/L at baseline to 19 umol/L at Week 24, which is within the normal range. Potentially aberrant high baseline ureagenesis values inconsistent with her known more severe clinical status make her ureagenesis results uninterpretable. This patient was on a tapering course of steroids at the time of last assessment and has not yet discontinued alternate pathway medications or liberalized her diet. The investigator reported that her family says her health is the best it has ever been.

Patient 9 (potential responder, male):
Patient 9 showed a 123 percent increase in rate of ureagenesis, from 25 percent of normal at baseline to 56 percent of normal at Week 12 while still on a steroid taper. Steroids have been shown to suppress rate of ureagenesis in other study patients. This patient has not yet discontinued alternate pathway medications or liberalized his diet. His ammonia levels have remained in the normal range and response status will be confirmed after additional follow-up.

Cohort 2 Efficacy Summary: Two responders including new responder and previously-disclosed male complete responder

Patient 6 (new responder, female):
Patient 6 has now shown a 218 percent improvement in rate of ureagenesis, from 20 percent of normal at baseline to 61 percent at Week 52 and maintained at 64 percent at Week 78. In addition, she has shown a significant 74 percent reduction in ammonia levels from 156 umol/L at baseline to 40 umol/L at Week 78. She has started to taper her alternate pathway medications and liberalize her diet. With this new responder, there are two confirmed responders in cohort 2 out of three total patients.

Safety Summary
As of the data cutoff date, there have been no infusion-related adverse events and no treatment-related serious adverse events reported in the study. All adverse events have been Grade 1 or 2. All three patients in Cohort 3 had mild, clinically asymptomatic elevations in ALT levels, similar to what has been observed in other programs using AAV-based gene therapy. All three patients have been responding to reactive tapering courses of steroids, and all patients remain clinically stable.

Initiating Prophylactic Steroid Cohort
As previously disclosed, a fourth cohort will enroll three patients at the 1.0 × 10^13 GC/kg dose, using prophylactic steroids. Patients will receive an 8-week tapering regimen of prophylactic steroids, starting at least 5 days prior to dosing with DTX301 at a starting steroid dose of 60 mg/day. The first patient is expected to be enrolled in the first half of 2020, and data from the prophylactic steroid cohort are expected in the second half of 2020.

Potential Phase 3 Study Design
Ultragenyx is continuing discussions with the U.S. Food and Drug Administration (FDA) regarding the potential Phase 3 study design. Ammonia is expected to be a primary endpoint based on direct FDA feedback to date, with ureagenesis as a measure of biologic activity that supports the decision for patients to discontinue alternate pathway medications.

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