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Ionis (IONS) Misses Estimates for Q3 Earnings and Sales

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Ionis Pharmaceuticals, Inc. (IONS - Free Report) reported third-quarter adjusted loss per share of 22 cents, which was wider than the Zacks Consensus Estimate of a loss of 11 cents. In the year-ago quarter, Ionis had recorded earnings of 18 cents per share, which included a $150 million license fee Ionis earned from Novartis (NVS - Free Report) .

Ionis reported total revenues of $160 million, down 4.8% year over year due to lower R&D revenues and royalties on Spinraza in the quarter. Sales also missed the Zacks Consensus Estimate of $180 million.

In August, Ionis announced that it plans to buy the remaining 24% stake in Akcea for approximately $500 million. The transaction closed in October 2020 and Akcea became a wholly owned subsidiary of Ionis. Prior to completing its acquisition of Akcea, Ionis owned approximately 76% of Akcea

Ionis’ shares were up 1.3% on Wednesday, following the earnings release. This year so far, Ionis’ shares have declined 21.2% compared with the industry’s decrease of 8.8%.

 

 

Quarter in Detail

Ionis has three commercial medicines approved in major global markets, Spinraza, Tegsedi and Waylivra. It has licensed Spinraza to Biogen (BIIB - Free Report) .

Biogen is responsible for commercializing Spinraza, approved for treating spinal muscular atrophy, or SMA, worldwide. Ionis receives royalties from Biogen on Spinraza’s sales. Tegsedi (hereditary TTR amyloidosis, or hATTR) and Waylivra (genetically confirmed familial chylomicronemia syndrome, or FCS) are its own products. While Tegsedi is marketed in both the United States and EU, Waylivra is marketed in European countries. Ionis plans to refile for U.S. approval of Waylivra next year.

Ionis earns commercial revenues, primarily royalty payments on net sales of Spinraza and R&D revenues, from partnered medicines. Ionis has collaboration deals with leading drugmakers/biotech companies namely AstraZeneca, Bayer, Biogen, Glaxo, J&J, Novartis, Pfizer and Roche for developing and marketing their medicines.

Third-quarter revenues comprised commercial revenues of $95 million, down 1% year over year, and R&D revenues of $65 million, down almost 10% from year-ago quarter.

Commercial revenues from Spinraza royalties were $74 million, down almost 10% year over year as Biogen reported softer sales of the drug. Product sales from Tegsedi and Waylivra were $19 million, compared with $12 million in the year-ago quarter. License and royalty revenues were $2 million in the quarter

R&D revenues included more than $50 million for advancing medicines within its neurological disease franchise driven by several Biogen partnered programs,

Ionis expects a substantial increase in R&D revenues in the fourth quarter, including the $75 million milestone payment from Pfizer (PFE - Free Report) .

R&D expenses rose 20.2% to $125 million in the quarter due to investments made to support its own pipeline. SG&A expenses rose 15% year over year to $69 million in the quarter.

Pipeline Update

Ionis has five pivotal phase III studies ongoing for four medicines (internal as well as partnered), which include tominersen for Huntington’s disease; tofersen for SOD1-ALS; pelacarsen (previously AKCEA-APO(a)-LRx) for cardiovascular disease due to elevated Lp(a) levels and AKCEA-TTR-LRx for TTR amyloidosis.  Its partners, Biogen, Roche and Novartis are now engaged in leading global development and commercialization activities related to tofersen, tominersen and AKCEA-APO(a)-LRx, respectively after Ionis developed them initially.

Ionis plans to have six pivotal studies underway by the end of the year, including a pivotal study for AKCEA- APOCIII-LRx in patients with FCS. It reiterated plans to file 10 or more new drug applications through the end of 2025, which will result in a number of new medicines.

2020 Guidance

Ionis expects to be meaningfully profitable in 2020.

Ionis currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Ionis Pharmaceuticals, Inc. Price, Consensus and EPS Surprise

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