Ultragenyx has experienced a significant drop in its market value after its experimental drug for osteogenesis imperfecta, setrusumab (UX143), failed to meet the main goal of reducing fracture rates in two Phase III clinical trials. The company lost approximately $1 billion in value following the announcement.
Setrusumab was being evaluated in the Orbit and Cosmis studies involving patients aged 5 to 25 with three subtypes of osteogenesis imperfecta, a rare genetic disorder affecting bone strength. While the drug improved bone mineral density—a secondary endpoint—this did not translate into fewer fractures compared to placebo.
Ultragenyx CEO Emil Kakkis commented on the outcome: “The drug had shown promise in an earlier Phase II trial.” He added that the company would continue analyzing data for further insights and is considering additional analyses focused on bone health and other clinical endpoints beyond fractures.
Ultragenyx also indicated it may implement expense reductions but did not specify what these might entail. The company currently markets four approved products and reported $160 million in revenue for the third quarter of 2025.
Mereo BioPharma, Ultragenyx’s partner on setrusumab, saw its shares fall sharply by 81% to 42 cents. Mereo CEO Denise Scots-Knight stated there would be “immediate reductions in our pre-commercial and manufacturing activities.” Mereo reported having $48.7 million in cash at the end of Q3 and will now accelerate efforts to find partners for alvelestat, another drug candidate targeting AATD lung disease.
Analysts from William Blair expressed surprise at the results given previous success in Phase II trials and noted that more severe cases were included in these latest studies. They questioned whether greater effects might have been seen among pediatric patients but noted that Ultragenyx has not released full data.
Truist Securities analysts remained skeptical about setrusumab’s potential impact, noting: “Alas, more defective bone does not result in stronger bone.”
Following these developments, Ultragenyx shares dropped about 43%, trading at $22.67 as of Friday morning—a decline of 32% since before the trial results were announced. According to William Blair analysts, this price reflects roughly the value of Ultragenyx’s currently approved products.
Looking ahead, attention will shift toward upcoming milestones over the next year. These include a pivotal Phase III readout for apazunersen, an antisense oligonucleotide being tested for Angelman syndrome, expected during Q3. Ultragenyx could also gain approval for two gene therapies that would add to its existing portfolio of rare disease treatments such as Mepsevii for mucopolysaccharidosis VII.
