Analyst Conference Summary


Ionis Pharmaceuticals

conference date: November 3, 2021 @ 8:30 AM Pacific Time
for quarter ending: September 30, 2021 (Q3, third quarter 2021)

Forward-looking statements

Overview: Continuing to develop pipeline.

Basic data (GAAP):

Revenue was $133 million, up 6% sequentially from $126 million, and down 17% from $160 million year-earlier.

Net income was negative $82 million, down sequentially from negative $81 million, and down from negative $24 million year-earlier.

EPS (diluted) was negative $0.58, down sequentially from negative $0.57, and down from negative $0.18 year-earlier.


On track for 2021 guidance. Revenue over $600 million.

Conference Highlights:

CEO Brett Monia said "We further expanded our broad late-stage pipeline to seven Phase 3 programs now that the olezarsen Phase 3 CORE study in patients with severe hypertriglyceridemia is underway. We were encouraged that while tofersen did not achieve the primary endpoint in the Phase 3 VALOR study, trends favoring tofersen were seen across multiple secondary and exploratory measures of disease progression in patients with SOD1-ALS. We also expanded our LICA platform capabilities by licensing technology from Bicycle Therapeutics." Based on our anticipated near- and mid-term catalysts, we remain on track to have 12 or more products on the market in 2026. We have the resources to meet our strategic objectives.

Donidalorsen (PKK-LRx) Phase 2 data in patients with hereditary angioedema will be presented at the ACAAI Annual Meeting the first weekend in November. Phase 3 initiation likely by year-end.

Spinraza sales by Biogen were $444 million. Over 11,000 patients being treated. Spinraza royalty rate resets each year. Biogen plans to initiate the Phase 3b Ascend study evaluating the potential benefit of an investigational higher dose of nusinersen in children, teens and adults with later-onset SMA who were previously treated with Evrysdi (risdiplam).

Waylivra (volanesorsen) is 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. Approved in Brazil in Q3 2021. Now distributed in Europe by Sobi. Not approved in U.S.

Tegsedi (Inotersen) is licensed and sold by Akcea. Tegsedi was approved in the EU for polyneuropathy in adults with hATTR (hereditary transthyretin amyloidosis). Now commercial in 15 countries, including Portugal, with additional EU launches planned. Now distributed in Europe by Sobi. Expanding into Canada and Latin America.

Q4 is likely to see an increase in R&D spend. But also higher revenue from partners.

Ionis sales and royalties, $ millions
therapy Q3 2021 Q2 2021 Q3 2020 y/y
Spinraza royalty $67 $72 $74 -9%
Tegsedi + Waylivra 15 12 19 -21%
licensing and royalty 3 2 2 50%
R&D collaboration 48 40 65 -26%

Non-GAAP numbers: net income negative $48 million, down sequentially from negative $36 million, and down from $12 million year-earlier. No non-GAAP EPS given.

Cash ended at $1.99 billion, down sequentially from $2.06 billion. Debt was $1.2 billion in convertible senior notes.

In Q3 2021 started the Phase 3 CORE study of olezarsen (IONIS-APOCIII-LRx) in patients with severe hypertriglyceridemia (sHTG).

In Q3 2021 reached full enrollment in the Bayer Phase 2b RE-THINc ESRD study of fesomersen (IONIS-FXI-LRx); data expected in the first half of 2022.

Pelacarsen for Lp(a) driven cardiovascular disease achieved 50% enrollment in Q3 2021, resulting in a $25 million milestone payment from Novartis.

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 completed dosing for ALS patients with SOD-1 mutation with data reported missed the primary endpoint in Q3 2021, but showed positive trends in secondaries.

Results from the eplontersen Phase 3 study in patients with TTR polyneuropathy are due mid-year 2022

In Q3 2021 showed proof of mechanism, a strong indication of proof of concept and good safety and tolerability in a Phase 2 study and a preliminary open-label extension study of cimdelirsen (IONIS-GHR-LRx) in acromegaly patients.

In Q3 2021 Ionis reached a license agreement with Flamingo Therapeutics for the development and commercialization of oncology programs from the Ionis pipeline. Under the terms of the agreement, Ionis is eligible to receive milestone payments and royalties on future product sales of the STAT3, AR, IRF4 and MALAT1 programs. Flamingo retains full rights to its FLAME platform and all lncRNA programs outside of MALAT1.

In Q2 2021 advanced ION363 into a Phase 3 trial for patients with FUS-ALS.

In Q2 2021 made a license agreement with Bicycle Therapeutics for rights to peptide technology to enhance LICA.

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

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

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

GAAP Operating expense was $219 million, consisting of $3 million for cost of goods sold; $185 million for R&D and $31 million for selling, general and administrative. Operating loss was $86 million. Other income was $2 million. Income tax benefit $2 million.

Q&A summary:

TTTR studies, type of patients? Polyneuropathy to read out midterm next year. Cariovascular outcome trial includes both wildtype and hereditary patients. Enrollment should complete in first half of next year.

FXTG program, vupanorsen? Vupanorsen with Pfizer is differentiated from olezarsen (APOCIII), which is strictly about triglycerides. Angiopoiten 3 is more a mixed dyslipodemic population, for vupanorsen. The market opportunity for olezarsen is very large. Olezarsen is best in class. There could be some overlap, but the drugs are mainly for separate markets.

Triglicerides are approvable alone. Pancreatitis positive outcome would be enhancing.

ION582 for Angelman syndrome, differentiation? Hoping for best in class, Phase 2 study should begin before year end.

We divested our oncology pipeline because those therapies require a great deal of expense and focus. We think the returns on investment were not working for us. Hence Flamingo deal. We have not disclosed milestones. Flamingo will fund and advance these medicines. We have less than 20% equity ownership.

Eplontersen, expansion of addressable patients? Has the great Lica profile. TTR reduction of up to 90%, vs. 70% for earlier products. Initially would launch with polyneuropathy. About 40,000 patients globally, initially. Currently only about 10% to 15% of these patients are getting treated.

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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 2021 William P. Meyers