Ultragenyx Receives FDA Incomplete Response Letter for UX111 Gene Therapy, Announces Restructuring

Ultragenyx Pharmaceutical received an Incomplete Response Letter from the U.S. Food and Drug Administration regarding its resubmitted marketing application for UX111 (rebisufligene etisparvovec) AAV9 gene therapy for Sanfilippo syndrome type A (MPS IIIA). The IRL requests additional supportive documentation related to its CRL CMC responses, which the company will provide in a resubmission.

The company had resubmitted its Biologics License Application for UX111 to the FDA, marking a key regulatory step. The resubmission includes extended clinical data showing sustained neurologic benefits and biomarker improvements, along with an adequate safety profile for Sanfilippo syndrome type A, which does not have any approved therapies. Long term data for UX111 in children with Sanfilippo syndrome Type A showed sustained biomarker reductions and functional improvements.

Ultragenyx reported fourth-quarter revenue of $207 million, up from $165 million a year ago, beating the consensus of $196.97 million. The company reported a fourth-quarter loss of $1.29 per share, missing the consensus of $1.14. Crysvita's revenue was $145 million, Dojolvi revenue reached $32 million, and Evkeeza sales were $17 million.

The company announced a strategic restructuring plan that includes a 10% workforce reduction, impacting approximately 130 employees. The restructuring is designed to reduce operating expenses and align resources with highest-impact opportunities. The significant reduction and partial reinvestment of expenses, and the planned growth in revenue from current and new product launches, are designed to keep the company on its path to profitability in 2027.

Ultragenyx forecasts fiscal 2026 sales of $730 million to $760 million versus the consensus of $786.93 million. Crysvita revenue is expected to be between $500 million and $520 million, reflecting growing underlying global demand partially offset by the expected timing of ordering patterns in Brazil. Dojolvi revenue is expected to be $100 million to $110 million.

In 2026, combined R&D and SG&A expenses are expected to be flat to down low single digits versus 2025. This includes the impact of spend reductions and approximately $50 million for severance, manufacturing, and other non-recurring restructuring charges. In 2027, R&D expenses are expected to decrease from 2025 levels by 38%, or approximately $280 million, driven by the completion of multiple phase 3 studies and the reduction of early-stage research efforts. On a combined basis, 2027 R&D and SG&A expenses are expected to decrease at least 15% versus 2025.

The price target on Ultragenyx Pharmaceutical was set to $60, which maintained a Buy rating on the stock. The estimate leads to a promising upside potential of more than 155% from the prevailing level. An Overweight rating was assigned with a target price of $44, which yields more than 87% upside potential.

At $20.52 versus a $59.75 consensus target, the price sits about 66% below where analysts as a group are looking. Ultragenyx Pharmaceutical shares were down 10.21% at $21.10 following the earnings announcement and FDA update.

Ultragenyx Pharmaceutical develops novel therapies, with a focus on identifying, acquiring, and commercializing products for rare and ultra-rare genetic diseases. It places strong emphasis on gene therapy and covers the various stages of clinical trials. The company is currently experiencing high cash burn, with the aim of becoming profitable from 2027 onward.