On November 9, 2022 Ionis Pharmaceuticals, Inc. (Nasdaq: IONS) (the "Company") reported financial results for the third quarter of 2022 (Press release, Ionis Pharmaceuticals, NOV 9, 2022, View Source [SID1234623538]). Financial results are summarized below :
Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:
Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing
Schedule Your 30 min Free Demo!
Financial Highlights
Revenue increased 20% for the third quarter of 2022 and 18% on a year-to-date basis compared to the same periods last year driven by significant partner payments earned across multiple programs
Non-GAAP operating expenses increased 5% for the third quarter of 2022 and 13% on a year-to-date basis compared to the same periods last year driven by advancing Phase 3 pipeline
Entered into a long-term lease in October 2022 to construct a new manufacturing facility supporting continued growth
Entered into a sale-leaseback transaction in October 2022 for several real estate assets, generating net proceeds of $240 million plus full funding to expand R&D campus
Reaffirmed 2022 P&L guidance; increased cash and investments guidance to approximately $2.0 billion
Late-Stage Pipeline Highlights
Presented positive data from the Phase 3 NEURO-TTRansform study of eplontersen in patients with polyneuropathy caused by hereditary TTR amyloidosis; on track to file U.S. New Drug Application this year
Expanded enrollment in the Phase 3 CARDIO-TTRansform study of eplontersen in patients with ATTR cardiomyopathy; data still expected first half of 2025
NDA for tofersen was accepted and granted priority review by the FDA; Prescription Drug User Fee Act date of April 25, 2023
Initiated CORE2, a confirmatory Phase 3 study of olezarsen in patients with severe hypertriglyceridemia (SHTG)
Initiated ESSENCE, a supporting Phase 3 study of olezarsen in patients with SHTG or hypertriglyceridemia and cardiovascular disease
Mid-Stage Pipeline Highlights
GSK presented positive end of study data from the Phase 2b B-Clear study of bepirovirsen demonstrating potential for functional cures in patients with chronic hepatitis B; GSK plans to advance bepirovirsen into Phase 3 development in the first half of 2023
Presented positive data from the Phase 2 study of IONIS-FB-LRx in patients with immunoglobulin A nephropathy; Roche plans to advance IONIS-FB-LRx into Phase 3 development in the first half of 2023
Bayer presented positive data from the Phase 2b study of fesomersen in patients with end-stage renal disease; Ionis regained rights to fesomersen from Bayer and is assessing next steps
Roche presented the Phase 2 GENERATION HD2 study design of tominersen in Huntington’s disease patients; Roche plans to begin enrollment in early 2023
Reported ION449 (AZD8233) targeting PCSK9 met the primary endpoint in Phase 2b SOLANO study in patients with hypercholesterolemia; based on pre-specified efficacy criteria, AstraZeneca is not advancing ION449
"We have made significant progress on our key priorities this year, building our commercial pipeline, delivering an abundance of new medicines to the market and expanding and diversifying our technology. We delivered positive data from eight key programs, positioning us to potentially add two new marketed medicines to our portfolio and expand our rich Phase 3 pipeline to eight medicines next year. Additionally, we have recently begun work on a manufacturing facility to support our pipeline growth," said Brett P. Monia, Ph.D., chief executive officer of Ionis. "As we advance our near-term opportunities, including filing the NDA this year for eplontersen, and expanding our rich late-stage pipeline, we are well positioned to drive increasing value for all stakeholders."
Total revenue for the three and nine months ended September 30, 2022 increased 20 percent and 18 percent compared to the same periods last year, respectively. The increase was driven by significant payments Ionis earned across multiple partnered programs. R&D revenue for the nine months ended September 30, 2022 included $85 million from Biogen for advancing several neurology disease programs, $63 million from Roche for licensing and advancing IONIS-FB-LRx and $55 million from AstraZeneca for its share of the global Phase 3 development costs for eplontersen.
Commercial revenue for the three and nine months ended September 30, 2022 decreased 15 percent and 13 percent compared to the same periods last year, respectively. SPINRAZA royalties for the three and nine months ended September 30, 2022 decreased 7 percent and 12 percent compared to the same periods last year, respectively. In the U.S., SPINRAZA sales were flat in the first nine months of 2022 compared to the same period last year. Outside of the U.S. SPINRAZA royalties were lower due to lower SPINRAZA product sales primarily due to decreased pricing, foreign currency exchange and competition. TEGSEDI and WAYLIVRA revenue was also lower due to the shift to distribution fees in 2021.
Operating Expenses
Ionis’ non-GAAP operating expenses increased for the three and nine months ended September 30, 2022 compared to the same periods in 2021, in line with expectations. For both periods, higher R&D expenses were driven by the expanded number of Phase 3 studies the Company is conducting, which doubled from three to six studies in 2021. SG&A expenses increased for the three months ended September 30, 2022 compared to the same period last year driven by Ionis’ go-to-market activities for eplontersen, donidalorsen and olezarsen. SG&A expenses were lower for the nine months ended September 30, 2022 compared to the same period last year largely due to the substantial savings the Company achieved from integrating Akcea and restructuring its commercial operations in 2021.
Balance Sheet
As of September 30, 2022, Ionis had cash, cash equivalents and short-term investments of $2.0 billion, compared with $2.1 billion at December 31, 2021. Ionis’ debt obligations and working capital did not change significantly from December 31, 2021 to September 30, 2022.
In October 2022, Ionis entered into a sale and leaseback transaction for several of its real estate assets. Under the agreement, Ionis will receive net proceeds of approximately $240 million plus full funding to expand the Company’s R&D campus. The net proceeds reflect the Company’s extinguishment of its mortgage debt for the related properties. Ionis’ fourth quarter financial results will reflect the impact this transaction.
2022 Financial Guidance
The Company reaffirmed its full year 2022 guidance for total revenue, operating expenses and net loss, on a non-GAAP basis. The Company’s 2022 operating expense guidance, compared to the prior year, includes increasing R&D expenses between 25% and 30% and consistent SG&A expenses. Ionis expects to recognize a substantial gain on the sale of its real estate assets in the fourth quarter. The gain will not impact the Company’s non-GAAP results since the sale was non-recurring and not part of the Company’s normal business operations.
The Company increased its full year 2022 cash and investments guidance to approximately $2.0 billion from the previous guidance of $1.7 billion.
"Our strong year-to-date results, including year-over-year revenue growth of nearly 20 percent, keep us on track to meet our 2022 P&L guidance," said Elizabeth L. Hougen, chief financial officer of Ionis. "Additionally, we recently bolstered our balance sheet when we unlocked net proceeds of approximately $240 million plus full funding to expand our R&D campus by capitalizing on the favorable life sciences real estate market and monetizing several of our facilities through a sale and leaseback transaction. As a result, we are increasing our 2022 cash and short-term investment guidance to approximately $2 billion."
Webcast
Management will host a conference call and webcast to discuss Ionis’ third quarter 2022 results at 11:30 a.m. Eastern time on Wednesday, November 9, 2022. Interested parties may access the webcast here. A webcast replay will be available for a limited time at the same address. To access the Company’s third quarter 2022 earnings slides click here.