CARLSBAD, Calif., Nov. 9, 2015 /PRNewswire/ -- Isis
Pharmaceuticals, Inc. (Nasdaq: ISIS) today
reported consolidated financial results for the third quarter
of 2015 and highlighted recent progress in advancing its
pipeline.
"Our drugs in development have the potential to make fundamental
changes in the way diseases are treated. Our pipeline is
large, with numerous late-stage programs that represent potential
near term commercial opportunities. We are conducting four Phase 3
studies which should complete enrollment in the next several
months. And, we believe these programs have each been substantially
de-risked by positive data from Phase 2 studies. Just last
week, we reported encouraging data from two Phase 2 studies of
ISIS-TTRRx, which support the potential benefit of
ISIS-TTRRx for patients with familial amyloid
polyneuropathy, FAP, and TTR amyloid cardiomyopathy. Together with
our partner, GSK, we are conducting a broad Phase 3 program
evaluating ISIS-TTRRx in all forms of TTR
amyloidosis. As part of this program, GSK plans to initiate a
Phase 3 study of ISIS-TTRRx in patients with TTR amyloid
cardiomyopathy, both familial and wild type, early next year.
Further, we expect to complete enrollment in our Phase 3
study of ISIS-TTRRx in patients with FAP by year end,"
said B. Lynne Parshall, chief
operating officer at Isis Pharmaceuticals. "Our other Phase 3
programs are also progressing well. We expect to complete
enrollment in both of our Phase 3 studies of nusinersen, the
generic name for ISIS-SMNRx, in infants and in children
with spinal muscular atrophy by early next year. In addition,
we and Akcea plan to complete enrollment in the Phase 3 study of
volanesorsen in patients with familial chylomicronemia syndrome
this year. We also plan to begin dosing patients in our Phase
3 study of volanesorsen in patients with familial partial
lipodystrophy by the end of the year. As enrollment nears
completion for the ongoing Phase 3 studies for
ISIS-TTRRx, nusinersen and volanesorsen, we and our
partners are working closely together to prepare for regulatory
filings and to prepare the drugs for the market."
"Yesterday, we reported positive clinical data on our
APO(a) LICA program, showing that our LICA technology can
create drugs that are 30-fold more potent in humans than our
generation 2.0+ antisense drugs. The increase in potency of
our LICA drugs could translate into a small and convenient dose
that patients could administer weekly, monthly, quarterly or even
less frequently. This, obviously, has implications for uptake,
adherence and compliance and opens up broader patient populations
for all of our LICA drugs. Importantly, the significantly improved
potency from our LICA technology represents a major advancement in
our pipeline. We currently have eight LICA drugs in development and
plan to report clinical data on several of these drugs next year,"
continued Ms. Parshall. "Given the attractive profile of
ISIS-APO(a)-LRx, together with Akcea, we plan to
aggressively develop this drug to maximize its value with near, mid
and long-term opportunities in patients who are at significant
cardiovascular risk due to high Lp(a) levels."
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
"We ended the third quarter with pro forma operating income of
$29 million and pro forma net income
of $25 million both of which reflect
a significant increase over the same period last year. In
addition, our operating loss of $13
million and net loss of $17
million, both according to GAAP, were significantly improved
over last year. Our continued strong financial performance reflects
the successes of the drugs in our pipeline. As our drugs
successfully advance, we generate cash and revenue from our
partners. During the first nine months of the year, we earned
over $230 million of revenue
including nearly $90 million in
revenue from milestone payments. Our revenue for the first
nine months also included more than $90
million we earned from our license of ISIS-FXIRx
to Bayer. We ended the third quarter with more than
$800 million of cash as a result of
the more than $300 million we
received from our partners during the first nine months of 2015.
Because of our financial performance so far this year, we expect to
improve upon our revised financial guidance of a pro forma NOL in
the low $30 million range and more
than $750 million in cash," said
Elizabeth L. Hougen, chief financial
officer of Isis Pharmaceuticals.
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 nine months ended September 30, 2015 was $49.1 million and $232.1
million, respectively, compared to $44.1 million and $129.3
million for the same periods in 2014. Isis' revenue in
the nine months ended September 30,
2015 consisted of the following:
- $91.2 million from Bayer in
connection with its exclusive license of
ISIS-FXIRx;
- $51.7 million from Biogen for
advancing ISIS-SMNRx in late-stage clinical development,
advancing ISIS-BIIB4Rx into development and validating
two new undisclosed targets for neurological disorders;
- $22 million from Roche for
initiating a Phase 1/2 study of ISIS-HTTRx;
- $15 million from GSK for
advancing the Phase 3 study of ISIS-TTRRx; and
- $49.5 million from the
amortization of upfront fees and manufacturing services performed
for its partners.
Already in the fourth quarter of 2015, Isis has earned
$16 million in milestone payments
from Biogen and GSK.
Isis' revenue fluctuates based on the nature and timing of
payments under agreements with its partners and consists primarily
of revenue from the amortization of upfront fees, milestone
payments and license fees.
Operating Expenses
Isis is conducting more
later-stage clinical trials in 2015 than it did in 2014. As
such, Isis' pro forma operating expenses of $82.3 million and $203.0
million for the three and nine months ended September 30, 2015, respectively, were higher
than the $57.4 million and
$164.2 million in the same periods in
2014. On a GAAP basis, Isis' operating expenses for the three and
nine months ended September 30, 2015
were $97.3 million and $245.0 million, respectively, compared to
$65.6 million and $187.1 million for the same periods in 2014.
Isis' 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, Isis received nearly
$26 million of cash and recorded a
$20.2 million gain on its sale of a
portion of the Regulus common stock it owns. Regulus is a satellite
company partner that Isis co-founded to discover and develop
antisense drugs targeting microRNAs. In total, Isis has received
nearly $50 million since 2014 from
its sale of Regulus' common stock demonstrating the success of
Isis' satellite company strategy. Isis now owns approximately 2.8
million shares, or approximately 5%, of Regulus' common
stock.
Net Loss
Isis reported a net loss of
$35.8 million and $16.8 million for the three and nine months ended
September 30, 2015, respectively,
compared to a net loss of $26.7
million and $70.0 million for
the same periods in 2014. Basic and diluted net loss per
share for the three and nine months ended September 30, 2015 was $0.30 and $0.14,
respectively, compared to $0.23 and
$0.60 for the same periods in 2014.
Isis significantly improved its net loss for the first nine
months of 2015 compared to the same period in 2014 primarily due to
the revenue the Company earned from its exclusive license agreement
with Bayer for ISIS-FXIRx, an increase in milestone
payments earned from its partners and the gain from its investment
in Regulus. The increase in operating expenses associated
with the Company's maturing pipeline of drugs and Akcea's
activities to prepare for the launch and commercialization of
volanesorsen partially offset the Company's increase in
revenue.
Balance Sheet
As of September 30, 2015, Isis had cash, cash
equivalents and short-term investments of $812.2 million compared to $728.8 million at December
31, 2014. Isis' working capital was $746.1 million at September 30, 2015 compared to $721.3 million at December
31, 2014. The increase in the Company's cash and working
capital primarily relates to the nearly $300
million the Company has received from its partners through
the end of September 2015.
Conference Call
At 11:30 a.m.
Eastern Time today, November 9,
2015, Isis 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.isispharm.com. A webcast replay
will be available for a limited time at the same address.
ABOUT ISIS PHARMACEUTICALS, INC.
Isis 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,
Isis 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 Isis is developing and plans to commercialize
through its wholly owned subsidiary, Akcea Therapeutics, to treat
patients with familial chylomicronemia syndrome and familial
partial lipodystrophy; ISIS-TTRRx, a drug Isis is
developing with GSK to treat patients with all forms of TTR
amyloidosis; and ISIS-SMNRx, a drug Isis is developing
with Biogen to treat infants and children with spinal muscular
atrophy. Isis' patents provide strong and extensive
protection for its drugs and technology. Additional
information about Isis is available at www.isispharm.com.
FORWARD-LOOKING STATEMENT
This press release includes
forward-looking statements regarding Isis Pharmaceuticals'
financial position and outlook, Isis' business, the business of
Akcea Therapeutics, Inc., a subsidiary of Isis Pharmaceuticals, and
the therapeutic and commercial potential of Isis' technologies and
products in development, including ISIS-SMNRx,
ISIS-TTRRx and volanesorsen. Any statement
describing Isis' 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. Isis' 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.
Although Isis' forward-looking statements reflect the good faith
judgment of its management, these statements are based only on
facts and factors currently known by Isis. As a result, you
are cautioned not to rely on these forward-looking
statements. These and other risks concerning Isis' programs
are described in additional detail in Isis' annual report on Form
10-K for the year ended December 31,
2014, and its most recent quarterly report on Form 10-Q,
which are on file with the SEC.
Copies of this and other documents are available from the
Company.
In this press release, unless the context requires otherwise,
"Isis," "Company," "we," "our," and "us" refers to Isis
Pharmaceuticals and its subsidiaries.
Isis Pharmaceuticals® is a registered trademark of
Isis Pharmaceuticals, Inc. Akcea Therapeutics™ is a trademark
of Isis Pharmaceuticals, Inc. Regulus Therapeutics™ is a
trademark of Regulus Therapeutics Inc.
Isis Pharmaceuticals' Corporate and Drug
Development Highlights
(2015 third quarter and subsequent
activities)
Corporate Highlights
- Isis and AstraZeneca formed a strategic collaboration to
discover and develop antisense therapies for treating
cardiovascular and metabolic diseases, primarily focused on targets
in the kidney, and renal diseases. The collaboration enables
Isis to broaden the application of its antisense technology to
targets in the kidney.
- In total, Isis has the potential to earn up to more than
$4 billion in license fees and
milestone payments.
- Isis received a $65 million
upfront payment from AstraZeneca and is eligible to earn
substantial development and regulatory milestone payments and
license fees. Isis is eligible to earn a payment of
$25 million under this collaboration
upon identification of the first drug candidate to move into
development.
- Isis is also eligible to earn tiered double-digit royalties on
annual net sales for each of the programs.
Drug Development Highlights
- Isis reported positive clinical results from
ISIS-APO(a)Rx and ISIS-APO(a)-LRx,
ISIS-TTRRx and KYNAMRO. These data exemplify the
broad applicability and potential for antisense drugs to provide
therapeutic benefit for many different diseases.
- Isis and its subsidiary, Akcea Therapeutics, reported results
from a Phase 2 study of ISIS-APO(a)Rx in patients with
high lipoprotein(a), or Lp(a), a known driver of cardiovascular
disease. In the Phase 2 study patients treated with
ISIS-APO(a)Rx achieved reductions in Lp(a) of up to 94
percent. Data from this study were presented at the American
Heart Association Scientific Sessions.
- Isis and Akcea reported results from a Phase 1/2a, study of
ISIS-APO(a)-LRx, a LIgand Conjugated Antisense (LICA)
version of ISIS-APO(a)Rx, in subjects with elevated
Lp(a). In the Phase 1 study, subjects (with Lp(a) greater
than 30 mg/dL) who received a single, low volume, subcutaneous
injection of ISIS-APO(a)-LRx, achieved dose-dependent
reductions in Lp(a) of up to 97 percent. Subjects who
received multiple doses of ISIS-APO(a)-LRx achieved up
to 99 percent reduction in Lp(a) levels. In addition,
ISIS-APO(a)-LRx demonstrated the potential for a variety
of convenient dose schedules - weekly, monthly, quarterly or less
frequent dosing. This is the first clinical data from Isis' LICA
program and represents a greater than 30-fold increase in potency
over ISIS-APO(a)Rx, the non-LICA Lp(a) drug. These
data significantly exceeded the potency and duration expectations
predicted by preclinical experiments. Data from this study
were presented at the American Heart Association Scientific
Sessions.
- Dr. Merrill Benson reported
positive preliminary results from an ongoing Phase 2 study in
patients with familial amyloid cardiomyopathy (FAC) and patients
with wild-type transthyretin amyloidosis (wt-TTR amyloidosis,
previously referred to as senile systemic amyloidosis, or SSA). In
this open-label, investigator initiated study, after six and 12
months of treatment with ISIS-TTRRx, Dr. Benson
observed:
- Evidence of disease stabilization. These observations
compare favorably to those from Benson's previously published
natural history data, in which disease progression was observed at
12 months.
- Sustained reductions in TTR compared to baseline.
- Isis reported positive results from an ongoing open-label
extension study (OLE) of ISIS-TTRRx in patients with
familial amyloid polyneuropathy (FAP). An analysis conducted
on the first 38 patients to reach at least three months of
treatment in the OLE study showed a maximum reduction in TTR
protein levels of up to 92 percent with a mean maximum (nadir)
reduction of 76 percent as compared to patients' TTR levels at
entry into the Phase 3 study.
- Isis reported that the FOCUS FH study evaluating KYNAMRO in
patients with severe heterozygous familial hypercholesterolemia met
its primary efficacy endpoint with a statistically significant
reduction of LDL-Cholesterol. Genzyme and Isis plan to report
the full data from this study at an upcoming medical
meeting.
- Isis and Akcea published clinical data from two novel lipid
drugs, volanesorsen and ISIS-APO(a)Rx, in the New
England Journal of Medicine and The Lancet, respectively.
These data highlight the significant interest from the medical
community in Isis' and Akcea's lipid drugs and the medical
importance of the clinical data from these programs.
- Volanesorsen was granted orphan drug designation from the US
FDA for the treatment of patients with familial chylomicronemia
syndrome.
- Isis continued to advance its pipeline of drugs:
- Akcea and Isis initiated a Phase 3 study of volanesorsen in
patients with familial partial lipodystrophy. This study is
designed to support regulatory filing for volanesorsen in this
patient population.
- Isis initiated a Phase 2 study of ISIS-FXIRx in
patients who have compromised renal function. These data will
be important to form the basis for Bayer's first Phase 3
study.
- Isis initiated a Phase 2 dose-optimization study of
ISIS-GCGRRx in patients with type 2 diabetes.
- Isis initiated a Phase 1/2 study of ISIS-HTTRx in
patients with Huntington's disease (HD). ISIS-HTTRx was
granted orphan drug designation by the European Medicines Agency
for the treatment of patients with HD.
- Isis initiated a Phase 2 study to evaluate the safety and
activity of ISIS-FGFR4Rx in obese patients.
- Isis initiated Phase 1 studies of ISIS-DGAT2Rx and
ISIS-GSK4-LRx in healthy volunteers.
ISIS
PHARMACEUTICALS, INC.
|
SELECTED FINANCIAL
INFORMATION
|
Condensed
Consolidated Statements of Operations
|
(In Thousands,
Except Per Share Data)
|
|
|
|
Three months
ended,
|
|
Nine months
ended,
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
Revenue:
|
|
(unaudited)
|
|
(unaudited)
|
|
Research and development revenue under collaborative
agreements
|
|
$48,918
|
|
$43,798
|
|
$230,469
|
|
$119,975
|
|
Licensing and royalty revenue
|
|
203
|
|
265
|
|
1,664
|
|
9,325
|
|
Total
revenue
|
|
49,121
|
|
44,063
|
|
232,133
|
|
129,300
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
Research, development and patent expenses
|
|
88,508
|
|
61,086
|
|
220,962
|
|
173,798
|
|
General and administrative
|
|
8,751
|
|
4,470
|
|
23,992
|
|
13,313
|
|
Total operating
expenses
|
|
97,259
|
|
65,556
|
|
244,954
|
|
187,111
|
|
Loss from
operations
|
|
(48,138)
|
|
(21,493)
|
|
(12,821)
|
|
(57,811)
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
Investment
income
|
|
1,185
|
|
675
|
|
2,946
|
|
2,003
|
|
Interest
expense
|
|
(9,233)
|
|
(4,998)
|
|
(27,381)
|
|
(14,902)
|
|
Gain on investments,
net
|
|
199
|
|
3
|
|
200
|
|
140
|
|
Gain on investment in
Regulus Therapeutics, Inc.
|
|
20,211
|
|
535
|
|
20,211
|
|
535
|
|
Loss before income
tax benefit (expense)
|
|
(35,776)
|
|
(25,278)
|
|
(16,845)
|
|
(70,035)
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
-
|
|
(1,398)
|
|
-
|
|
(2)
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$(35,776)
|
|
$(26,676)
|
|
$(16,845)
|
|
$(70,037)
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net
loss per share
|
|
$(0.30)
|
|
$(0.23)
|
|
$(0.14)
|
|
$(0.60)
|
|
Shares used in
computing basic and diluted net loss per share
|
|
119,979
|
|
117,811
|
|
119,560
|
|
117,511
|
|
|
|
|
|
|
|
|
|
|
|
|
Isis
Pharmaceuticals, Inc.
Reconciliation of
GAAP to Pro Forma Basis:
Condensed
Consolidated Operating Expenses, Loss From Operations, and Net
Loss
(In
Thousands)
|
|
|
|
|
|
|
|
Three months
ended,
September
30,
|
|
Nine months
ended,
September
30,
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
As reported
operating expenses according to GAAP
|
|
$97,259
|
|
$65,556
|
|
$244,954
|
|
$187,111
|
|
Excluding compensation expense related to equity
awards
|
|
(14,997)
|
|
(8,118)
|
|
(41,907)
|
|
(22,894)
|
|
|
|
|
|
|
|
|
|
|
|
Pro forma
operating expenses
|
|
$82,262
|
|
$57,438
|
|
$203,047
|
|
$164,217
|
|
|
|
|
|
|
|
|
|
|
|
As reported income
(loss) from operations according to GAAP
|
|
$(48,138)
|
|
$(21,493)
|
|
$(12,821)
|
|
$(57,811)
|
|
Excluding compensation
expense related to equity awards
|
|
(14,997)
|
|
(8,118)
|
|
(41,907)
|
|
(22,894)
|
|
|
|
|
|
|
|
|
|
|
|
Pro forma income
(loss) from operations
|
|
$(33,141)
|
|
$(13,375)
|
|
$29,086
|
|
$(34,917)
|
|
As reported net
loss according to GAAP
|
|
$(35,776)
|
|
$(26,676)
|
|
$(16,845)
|
|
$(70,037)
|
|
Excluding compensation
expense related to equity awards
|
|
(14,997)
|
|
(8,118)
|
|
(41,907)
|
|
(22,894)
|
|
|
|
|
|
|
|
|
|
|
|
Pro forma net
income (loss)
|
|
$(20,779)
|
|
$(18,558)
|
|
$25,062
|
|
$(47,143)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Pro Forma Basis
As
illustrated in the Selected Financial Information in this press
release, pro forma operating expenses, pro forma income (loss) from
operations, and pro forma net income (loss) were adjusted from GAAP
to exclude compensation expense related to equity awards, which are
non-cash. Isis has regularly reported non-GAAP measures for
operating results as pro forma results. These measures are
provided as supplementary information and are not a substitute for
financial measures calculated in accordance with GAAP. Isis
reports these pro forma results to better enable financial
statement users to assess and compare its historical performance
and project its future operating results and cash flows.
Further, the presentation of Isis' pro forma results is consistent
with how Isis' management internally evaluates the performance of
its operations.
Isis
Pharmaceuticals, Inc.
Condensed
Consolidated Balance Sheets
|
(In
Thousands)
|
|
|
|
|
|
|
|
September
30,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
|
(unaudited)
|
|
|
Assets:
|
|
|
|
|
Cash, cash
equivalents and short-term investments
|
|
$812,192
|
|
$728,832
|
Investment in
Regulus Therapeutics Inc.
|
|
18,594
|
|
81,881
|
Other current
assets
|
|
37,475
|
|
25,884
|
Property,
plant and equipment, net
|
|
89,243
|
|
88,958
|
Other
assets
|
|
30,501
|
|
30,254
|
Total assets
|
|
$988,005
|
|
$955,809
|
|
|
|
|
|
Liabilities and
stockholders' equity:
|
|
|
|
|
Other current
liabilities
|
|
$54,062
|
|
$63,619
|
Current
portion of deferred contract revenue
|
|
68,136
|
|
51,713
|
1% convertible
senior notes
|
|
342,136
|
|
327,486
|
2 3/4%
convertible senior notes
|
|
49,754
|
|
48,014
|
Long-term
obligations, less current portion
|
|
79,403
|
|
79,400
|
Long-term
deferred contract revenue
|
|
149,100
|
|
127,797
|
Stockholders'
equity
|
|
245,414
|
|
257,780
|
Total liabilities and stockholders' equity
|
|
$988,005
|
|
$955,809
|
|
|
|
|
|
|
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SOURCE Isis Pharmaceuticals, Inc.