CARLSBAD, Calif., Feb. 25, 2016 /PRNewswire/ -- Ionis Pharmaceuticals, Inc. (Nasdaq: IONS) today reported it ended the year in a strong financial position, significantly outperforming its guidance for both pro forma net operating loss (NOL) and cash.
“We have a pipeline of drugs with the potential to change the lives of patients with many different diseases. In 2015, we completed target enrollment in three Phase 3 studies for our three most advanced drugs in development; nusinersen, IONIS-TTRRx and volanesorsen, bringing these important new medicines one step closer to potentially reaching the market. These drugs are being developed for six different patient populations. We believe the robust development plan for each of these three drugs supports their significant commercial potential. We and our partners are well along in preparing for regulatory filings and for commercialization of nusinersen and IONIS-TTRRx. Our wholly owned subsidiary, Akcea Therapeutics, has begun the key steps necessary to launch volanesorsen. Paula Soteropoulos and her team, working with experts in the field, have begun to implement a multi-step program to increase diagnosis and referral of patients with FCS to lipid-focused physicians. In addition, they are assembling the commercial infrastructure that will support the global launch of volanesorsen,” said B. Lynne Parshall, chief operating officer of Ionis Pharmaceuticals.
“The majority of our drugs in Phase 3 and Phase 2 clinical development and our growing number of earlier stage programs provided us with numerous opportunities to highlight the breadth and depth of our pipeline in 2015. We reported positive clinical data from ten drugs in development. We designed these drugs to treat patients with a wide variety of diseases. In addition, in 2015 we advanced several earlier-stage programs into clinical development, including our drug to treat patients with Huntington’s disease. We believe these earlier-stage drugs represent the next wave of new medicines with the potential to fundamentally change the treatment of diseases that are currently untreatable,” continued Ms. Parshall. “The innovations we have made in our technology have the potential to add significant value to our pipeline. The substantial increase in potency conferred by our LICA technology supports weekly, monthly, quarterly or even less frequent dosing. This is a major advance and broadens the reach of our technology to larger patient populations and new therapeutic areas. The additional potency we achieved with our Generation 2.5 technology also allows us to continue to expand the opportunities for our antisense drugs.”
“In 2016, we plan to complete Phase 3 studies for nusinersen, IONIS-TTRRx and volanesorsen and report data from these studies in the first half of 2017. We plan to report additional data from the open-label studies of nusinersen and IONIS-TTRRx. Data from these open-label studies continue to support the potential of these important new drugs. We will continue to provide updates as Akcea builds its commercial infrastructure and prepares to launch volanesorsen. We also plan to report data from many clinical studies, including Phase 2 data from our novel antithrombotic drug, IONIS-FXIRx, and additional clinical data on the LICA drugs we are developing. All of these activities build upon the value we have created and provide us with an event-rich year ahead,” concluded Ms. Parshall.
Ionis’ 2016 goals and the full list of corporate and drug development highlights can be found at the end of this press release prior to the financial tables.
Financial Results
“Over the past several years, we have ended each year in a better financial position than when we began. During this time, we advanced three important new drugs into Phase 3 development, initiated five Phase 3 studies on these drugs, advanced 12 Phase 2 drugs and multiple Phase 1 drugs, and translated our technological innovations into the next wave of drugs to enter clinical development. Over the last several years, we have consistently increased our revenues and cash balance while decreasing our pro forma NOL reflecting the successes in our partnerships. We continued this trend in 2015 by significantly outperforming both our pro forma NOL and cash guidance. We ended the year with a pro forma NOL of $16 million, which represents a more than 70 percent improvement over our original guidance. On a GAAP basis, our operating loss was $76 million. During 2015, we received more than $320 million from our partners and ended the year with more than $775 million of cash, which is $150 million more than our original guidance. As our drugs successfully advance, we generate cash and revenue from our partners. In addition to cash and revenue, our partners provide expertise and significant additional resources, which allow us to minimize our research and development spending. Importantly, we believe these contributions will maximize the commercial value of our partnered drugs. Furthermore, with three potentially transformational medicines close to commercialization, we are looking forward to adding product revenues and royalties to our revenue base over the next few years,” said Elizabeth L. Hougen, chief financial officer of Ionis Pharmaceuticals.
“In 2016, we plan to continue to progress the drugs we have in development, including our Phase 3 drugs for which we are conducting multiple Phase 3 studies. We also plan to expand our pipeline and continue to invest in advancing our technology. Akcea plans to continue conducting the pre-commercialization activities and building the global medical, marketing and sales infrastructure to successfully commercialize volanesorsen. The efficiency of our technology and our business strategy allows us to do all of this while continuing to be fiscally prudent. We are also able to advance this large agenda while maintaining a strong cash balance because of the cash we generate as our partnered programs progress. As such, we are projecting a pro forma NOL in the low $60 million range and a year-end cash balance in excess of $600 million,” concluded Ms. Hougen.
All pro forma amounts referred to in this press release exclude non-cash compensation expense related to equity awards. Please refer to the reconciliation of pro forma and GAAP measures, which is provided later in this release.
Revenue
Revenue for the three and twelve months ended December 31, 2015 was $51.6 million and $283.7 million, respectively, compared to $84.9 million and $214.2 million for the same periods in 2014. Ionis’ revenue in 2015 consisted of the following:
- $91.2 million from Bayer in connection with its exclusive license agreement for IONIS-FXIRx;
- $72.6 million from Biogen for advancing the Phase 3 program for nusinersen, advancing IONIS-DMPK-2.5Rx and IONIS-BIIB4Rx, and validating three new targets for neurological disorders, which have proceeded forward in drug development;
- $22 million from Roche for initiating a Phase 1/2 study of IONIS-HTTRx;
- $20 million from GSK for advancing the Phase 3 program of IONIS-TTRRx and initiating a Phase 1 study of IONIS-GSK4-LRx; and
- $77.9 million primarily from the amortization of upfront fees and manufacturing services performed for its partners.
Already in the first quarter of 2016, Ionis has generated $7 million in milestone payments from Biogen for advancing the Phase 3 program for nusinersen, advancing IONIS-BIIB4Rx and from GSK when GSK initiated the Phase 1 study for IONIS-HBV-LRx.
Ionis’ revenue fluctuates based on the nature and timing of payments under agreements with its partners and consists primarily of revenue from the amortization of milestone payments, license fees and upfront fees.
Operating Expenses
In 2015, Ionis had higher operating expenses compared to 2014 primarily due to increased spending to support the Company’s ongoing Phase 3 studies for nusinersen, IONIS-TTRRx and volanesorsen, which are in the most expensive stage of development. In addition, Akcea continued to build its operations in preparation for the commercial launch of volanesorsen. As such, Ionis’ pro forma operating expenses of $97.1 million and $300.2 million for the three and twelve months ended December 31, 2015, respectively, were higher than the $66.3 million and $230.5 million for the same periods in 2014. On a GAAP basis, Ionis’ operating expenses for the three and twelve months ended December 31, 2015 were $114.5 million and $359.5 million, respectively, compared to $74.8 million and $261.9 million for the same periods in 2014. Ionis’ operating expenses on a GAAP basis included non-cash compensation expense related to equity awards, which increased due to the increase in the Company’s stock price in January 2015 compared to January 2014.
Gain on Investment in Regulus Therapeutics Inc.
In the third quarter of 2015, Ionis received nearly $26 million of cash and recorded a $20.2 million gain on its sale of a portion of its Regulus common stock. Regulus is a satellite company partner that Ionis co-founded to discover and develop antisense drugs targeting microRNAs. In total, Ionis has received nearly $50 million since 2014 from its sale of Regulus’ common stock. Ionis now owns approximately 2.8 million shares, or approximately 5%, of Regulus’ common stock.
Net Loss
Ionis reported a net loss of $71.4 million and $88.3 million for the three and twelve months ended December 31, 2015, respectively, compared to net income of $31.1 million and a net loss of $39.0 million for the same periods in 2014. Basic and diluted net loss per share for the three and twelve months ended December 31, 2015 was $0.59 and $0.74, respectively. Basic and diluted net income per share for the three months ended December 31, 2014 was $0.26 and $0.25, respectively, while both basic and diluted net loss per share was $0.33 per share for the year ended December 31, 2014. Ionis’ increased net loss for 2015 compared to 2014 was primarily due to the increased expenses related to advancing Ionis’ large pipeline partially offset by the Company’s increase in revenue in 2015.
Balance Sheet
As of December 31, 2015, Ionis had cash, cash equivalents and short-term investments of $779.2 million compared to $728.8 million at December 31, 2014. Ionis’ cash balance increased in 2015 primarily due to the more than $320 million in cash Ionis received from its partners. Ionis’ working capital was $688.1 million at December 31, 2015 compared to $721.3 million at December 31, 2014.
Conference Call
At 11:30 a.m. Eastern Time today, February 25, 2016, Ionis will conduct a live webcast conference call to discuss this earnings release and related activities. Interested parties may listen to the call by dialing 877-443-5662 or access the webcast at www.ionispharma.com. A webcast replay will be available for a limited time at the same address.
ABOUT IONIS PHARMACEUTICALS, INC.
Ionis is the leading company in RNA-targeted drug discovery and development focused on developing drugs for patients who have the highest unmet medical needs, such as those patients with severe and rare diseases. Using its proprietary antisense technology, Ionis has created a large pipeline of first-in-class or best-in-class drugs, with over a dozen drugs in mid- to late-stage development. Drugs currently in Phase 3 development include volanesorsen, a drug Ionis is developing and plans to commercialize through its wholly owned subsidiary, Akcea Therapeutics, to treat patients with familial chylomicronemia syndrome and familial partial lipodystrophy; IONIS-TTRRx, a drug Ionis is developing with GSK to treat patients with all forms of TTR amyloidosis; and nusinersen, a drug Ionis is developing with Biogen to treat infants and children with spinal muscular atrophy. Ionis’ patents provide strong and extensive protection for its drugs and technology. Additional information about Ionis is available at www.ionispharma.com.
FORWARD-LOOKING STATEMENT
This press release includes forward-looking statements regarding Ionis Pharmaceuticals’ financial position and outlook, Ionis’ business, the business of Akcea Therapeutics, Inc., a subsidiary of Ionis Pharmaceuticals, and the therapeutic and commercial potential of Ionis’ technologies and products in development, including nusinersen, IONIS-TTRRx and volanesorsen. Any statement describing Ionis’ goals, expectations, financial or other projections, intentions or beliefs is a forward-looking statement and should be considered an at-risk statement. Such statements are subject to certain risks and uncertainties, particularly those inherent in the process of discovering, developing and commercializing drugs that are safe and effective for use as human therapeutics, and in the endeavor of building a business around such drugs. Ionis’ forward-looking statements also involve assumptions that, if they never materialize or prove correct, could cause its results to differ materially from those expressed or implied by such forward-looking statements.
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