Ultragenyx Pharmaceutical Inc. (RARE) is having a rough Friday, with shares down over 10% after the rare disease drugmaker delivered mixed quarterly results and some unwelcome news from regulators. Sometimes it's not just about the numbers you report—it's about what you buried in the press release.

The FDA Problem

Here's the thing investors are really reacting to: tucked into Thursday's earnings announcement was word that the FDA issued an Incomplete Response Letter regarding the company's resubmitted application for UX111 (rebisufligene etisparvovec), an AAV9 gene therapy for Sanfilippo syndrome type A. The agency wants additional supportive documentation related to chemistry, manufacturing, and controls responses from a previous Complete Response Letter.

Translation: more paperwork, more delays. William Blair tried to stay optimistic, noting that "while the IRL is frustrating, we think it will ultimately be promptly resolved." That's the analyst version of "it's fine, everything's fine."

The Numbers Game

Ultragenyx reported a fourth-quarter loss of $1.29 per share, missing the consensus estimate of $1.14. On the revenue side, things looked better: sales hit $207 million, up from $165 million a year earlier and topping the $196.97 million consensus.

Breaking down the product lineup: Crysvita brought in $145 million, Dojolvi reached $32 million, and Evkeeza added $17 million. Not bad for a portfolio focused on ultra-rare diseases.

Cutting to Survive

CEO Emil Kakkis positioned the year ahead as "an important turning point for the company" with two potential product launches and pivotal data that "could significantly accelerate our commercial revenue trajectory." But turning points require tough decisions.

The company announced a strategic restructuring that will eliminate roughly 130 positions—a 10% workforce reduction. Kakkis explained they're working to "reduce our operating expenses and ensure our resources are squarely aligned with our highest-impact opportunities, while leading the future of rare disease with multiple first-ever treatments."

The math is straightforward: cut costs now, grow revenue from existing and new products, and hit profitability by 2027. That's the plan, anyway.

Looking Ahead

For fiscal 2026, Ultragenyx expects revenue between $730 million and $760 million—below the analyst consensus of $786.93 million. Crysvita should contribute $500-$520 million, though that reflects timing issues with Brazilian ordering patterns offsetting global demand growth. Dojolvi is projected to bring in $100-$110 million.

The restructuring is designed to drive meaningful cost discipline. In 2026, combined R&D and SG&A expenses are expected to be flat to down low single digits compared to 2025, including approximately $50 million in severance and other non-recurring restructuring charges.

The real savings come in 2027, when R&D expenses are projected to drop 38%—roughly $280 million—driven by completing multiple Phase 3 studies and scaling back early-stage research. Overall, 2027 R&D and SG&A expenses should decrease at least 15% versus 2025 levels.

Ultragenyx Pharmaceutical shares were trading down 10.21% at $21.10 Friday afternoon, according to market data. Investors are clearly pricing in the FDA delay and lower-than-expected guidance, even as management insists the company is positioning itself for that profitability finish line two years out.