Ultragenyx Faces Setback as Bone Disease Trials Fail to Meet Primary Endpoint

Ultragenyx Pharmaceutical has reported disappointing results from two late-phase clinical trials for setrusumab, a sclerostin-inhibiting antibody developed to treat osteogenesis imperfecta, commonly known as brittle bone disease. The failure of these trials has prompted the company to announce plans for significant cost-cutting measures and has sent ripples through the biotech industry.

Trial Results and Implications

The phase 2/3 Orbit trial and the phase 3 Cosmic study, which tested setrusumab against placebo and bisphosphonates respectively, both failed to meet their primary endpoint of reducing the annualized fracture rate in patients with osteogenesis imperfecta. Despite showing significant improvements in bone mineral density, as observed in earlier phase 2 trials, the therapy did not translate these gains into a meaningful reduction in bone fractures.

Ultragenyx noted that the fracture rate in the placebo arm was unexpectedly low, although detailed data from the studies have yet to be released. This outcome has surprised industry analysts, particularly given the increased enrollment of patients with severe disease in the pivotal program, which was expected to yield a higher fracture rate in the placebo group compared to earlier trials.

Financial Fallout and Future Plans

The news of the trial failures has had immediate and significant financial repercussions. Ultragenyx's stock plummeted 43% on the day of the announcement, closing the year 33% down from its pre-announcement price at $23. The company has stated it will "promptly define and implement significant expense reductions" in response to these setbacks.

Mereo BioPharma, which retains the European rights to setrusumab, experienced an even more dramatic market reaction, with its shares falling nearly 90% before slightly recovering. Mereo, which reported $48.7 million in cash reserves at the end of the third quarter, has announced plans to "tightly control costs" while further analyzing the trial data.

Industry Impact and Next Steps

The failure of these high-profile trials raises questions about the future of setrusumab and potentially impacts the broader field of bone disorder treatments. Ultragenyx is continuing to analyze the data before deciding on the next steps for the program. Key areas of interest include whether setrusumab showed greater efficacy in children and patient-reported outcomes, details which were not included in the initial press release.

William Blair analysts have expressed hesitation about the future of setrusumab given the failed trials. The biotech community now awaits more comprehensive data analysis and Ultragenyx's strategic decisions, which could have far-reaching implications for the company and the development of therapies for osteogenesis imperfecta.