Fosdagrocorat (PF‐04171327), a dissociated agonist of the glucocorticoid receptor, has potent anti‐inflammatory activity in patients with rheumatoid arthritis with reduced adverse effects on bone health. To identify fosdagrocorat doses with bone formation marker changes similar to prednisone 5 mg, we characterized treatment‐related changes in amino‐terminal propeptide of type I collagen (P1NP) and osteocalcin (OC) with fosdagrocorat (1, 5, 10, or 15 mg) and prednisone (5 or 10 mg) in a phase II randomized trial (N = 323). The time course of markers utilized a mixed‐effects longitudinal kinetic‐pharmacodynamic model. Median predicted changes from baseline at week 8 with fosdagrocorat 5, 10, and 15 mg were −18, −22, and −22% (P1NP), and −7, −13, and −17% (OC), respectively. Changes with prednisone 5 and 10 mg were −15% and −18% (P1NP) and −10% and −17% (OC). The probability of fosdagrocorat doses up to 15 mg being noninferior to prednisone 5 mg for P1NP and OC changes was >90%.