Analyst Conference Summary


Ionis Pharmaceuticals

conference date: November 4, 2020 @ 8:30 AM Pacific Time
for quarter ending: September 30, 2020 (Q3, third quarter 2020)

Forward-looking statements

Overview: Reabsorbed Akcea after the quarter ended. Sales not great, but making strong pipeline progress and getting milestone payments.

Basic data (GAAP):

Revenue was $160 million, up 10% sequentially from $146 million, and down 5% from $168 million year-earlier.

Net income was negative $43 million, down sequentially from negative $32 million, and down from $18 million year-earlier.

EPS (diluted) was negative $0.22, up sequentially from negative $0.23, and down from $0.18 year-earlier.


On track to achieve prior 2020 guidance of meaningful profitability.

Conference Highlights:

December 7 will be the Investor Day presentation.

CEO Brett Monia said "We took an important step forward in our evolution when we acquired Akcea. This transaction supports our commercial strategy, further enabling us to maximize the value of our Ionis-owned pipeline. As one company, we believe we are stronger and more efficient, with an enhanced ability to achieve even greater future success. We made significant progress across our pipeline this year. Recently, we advanced inhaled delivery with IONIS-ENAC-2.5Rx, positioning us to bring new treatment options to patients with pulmonary diseases. We also initiated mid-stage studies for vupanorsen in cardiovascular disease patients and ION541, our medicine to treat nearly all forms of ALS. Additionally, our five Phase 3 studies continue to progress, with our sixth expected to begin by the end of this year. We believe our achievements this year move us closer to delivering 10 or more marketing applications through 2025."

Akcea was reabsorbed back into Ionis on October 12. Estimate of cash following acquisition is $1.8 billion. Should result in some expense savings in 2021. In Q4 Ionis already earned revenue from multiple sources, including $75 million from Pfizer for advancing vupanorsen. Also may bet a substantial judgment against Alnylam in Q4.

Spinraza sales by Biogen were $495 million, flat sequentially but down 10% y/y. Some impact from competition, some from pandemic. Over 11,000 patients being treated.

Waylivra (volanesorsen) was approved in the EU for the treatment of adults with genetically confirmed familial chylomicronemia syndrome (FCS) at high risk for pancreatitis. Commercially available in Germany, Austria, Greece, and France. Filed in Brazil. Will refile for marketing authorization with the FDA in 2020.

Tegsedi (Inotersen) + Waylivra sales were $16 million, up sequentially from $15 million, and from $10 million year-earlier. Tegsedi is licensed and sold by Akcea. Tegsedi was approved in the EU for polyneuropathy in adults with hATTR (hereditary transthyretin amyloidosis). Now commercial in than 15 countries, with additional EU launches planned for 2020.

Recorded $44 million in milestone revenue in the quarter.

Ionis sales and royalties, $ millions
therapy Q3 2020 Q2 2020 Q3 2019 y/y
Spinraza $74 $72 $82 -10%
Tegsedi + Waylivra 19 16 12 58%
R&D collaboration 65 56 72 -10%

Non-GAAP numbers: net income $5 million, up sequentially from $8 million, and but down 87% from $39 million year-earlier.

Cash ended at $2.33 billion, up sequentially from $2.3 billion. Debt was $739 million convertible senior notes. Ionis repurchased no shares of common stock for a total purchase price of $0 million.

In Q3 2020 positive IONIS-ENAC-2.5Rx healthy volunteer results provided support for inhaled antisense medicine delivery. Dosing was completed in the IONIS-ENAC-2.5Rx Phase 2 study in patients with cystic fibrosis. Ionis also plans to initiate an IONIS-ENAC-2.5Rx Phase 2 study in patients with chronic obstructive pulmonary disease in late 2020.

SMA population treatable with Spinraza is larger than originally estimated, more than 45,000 patients in markets already established. In Q3 2020 over 11,000 patients were receiving Spinraza.

Huntington's and ALS therapies are in Phase 3 studies partnered with Biogen. ION541 advanced into Phase 1/2 development in patients with nearly all forms of ALS. Has multiple preclinical programs in development for ALS. ION464 advanced into Phase 1/2 development in patients with multiple system atrophy.

Tofersen (IONIS-SOD1Rx) Phase 3 study continues for ALS patients with SOD-1 mutation with data expected in 2H 2021.

Vupanorsen positive Phase 2 results were presented at ESC 2020. In Q4 2020 Vupanorsen advanced into Phase 2b development with the initiation of the dose-ranging study in statin-treated patients with dyslipidemia, resulting in a $75 million payment from Pfizer

Enrollment was completed in the IONIS-PKK-LRx Phase 2 study in patients with hereditary angioedema. IONIS-PKK-LRx advanced into an investigator-initiated study in hospitalized COVID-19 patients in Brazil.

Ionic plans to initiate a Phase 3 study of AKCEA-APOCIII-LRx in patients with FCS in 2020. Positive Phase 2 results were presented at ESC 2020. Granted Fast Track designation by FDA.

In Q2 2020 Roche completed enrollment of patients in a Phase 3 study for IONIS-HTTRx (now Tominersen). It had been granted EU designation for possible accelerated assessment for Huntington's disease. Roche released data from the OLE study of IONIS-HTTRx in patients with Huntington's disease and changed dosing to once every four months. Could make a regulatory filing in 2022.

AKCEA-APO(a)-LRx for CVD (cardiovascular disease) continued its Phase 3 study. Novartis licensed this. Phase 2 results were publishing in the New England Journal of Medicine.

With Biogen, progressed the IONIS-MAPTRx long-term extension study in patients with Alzheimer's disease and achieved a $12 million milestone payment in Q2 2020.

In Q3 2020 IONIS-FXI-LRx advanced into Phase 2b development in patients with end-stage renal disease

In Q3 2020 IONIS-HBVRx advanced into Phase 2b development in patients with hepatitis B virus infection

The Phase 3 study for the AKCEA-TTR-LRx continued enrollment.

In Q2 2020 Initiated a Phase 1 study of ION253 for the treatment of immune-mediated GI disease and achieved a $5 million milestone payment from Janssen.

Ionis continues to develop technologies that allow RNA therapies to almost any part of the body, including inhaled agents.

Ionis has a pipeline of 45 potential drugs. A growing number are wholly-owned.

GAAP Operating expense was $197 million, consisting of $3 million for cost of goods sold; $125 million for R&D and $69 million for selling, general and administrative. Operating loss was $37 million. Other loss was $3 million. Income tax $3 million. Net loss attributable to noncontrolling interest in Akcea $12 million.

Q&A summary:

ENAC Phase 1 data, PK vs. ENAC reduction? High dose issue? This was in normal volunteers, excellent safety. Consistent with preclinical. Effects were dose dependent and statistically significant. Now in Phase 2 with CF patients. The high bolus dose, given less frequently, did track PK to ENAC.

ION541? Strong rational for the target. Modulates PDP43, important to most forms of ALS. In theory combinations could provide added benefit.

Akcea platform applicability? The acquisition accelerates our ability to build out commercial capabilities. We believe that the platform could be applicable to neurological indications.

Described why ENAC2.5 is more potent than earlier ENAC versions.

Anecdotal info is that some patients do better on Spinraza than gene therapy, so doing a trial to test that hypothesis.

Main point of Akcea acquisition is to be able to commercialize therapies without partners. Focus is still on growing capabilities, not profitability, though that is still important to us.

We believe the American Heart meeting will show our therapy is highly differentiated for PCSK9 (IONIS-AZ4-2.5LRx with AstraZeneca), and can be delivered subq or orally. We believe we are going to be able to produce several oral medicines, this would just be the first.

Switches from Spinraza, indication of future rate? We and Biogen believe switches were a function of pent up demand, not a trend going forward.

Business development strategy now? Our strategy will focus on rare diseases. We have an extremely prolific platform. When potential drugs do not fit our strategy we will seek to partner them. On the whole we will partner less post the Akcea acquisition.

Acromegaly (IONIS-GHR-LRx) program patients? We have both failed and naive patients in our studies.

Bioavailability of LICA drugs in general? Oral availability is very similar to our non-LICA drugs. Also stable and effective in target reduction in the liver. We have shown it is transferable for 2.5 LICA drugs.

OpenIcon Analyst Conference Summaries Main Page



More Analyst Conference Pages:



Disclaimer: My analyst call summaries may include both condensations of statements made by company representatives and my own analysis. They are not covered by any warranty. I cannot guarantee anything said by company representatives is true. I try not to make errors, but it is possible. These are my personal notes which I share with other investors and which I use as the basis of my blog and Seeking Alpha articles.

Copyright 2020 William P. Meyers