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Ionis Out-Licenses Second Candidate to AstraZeneca, Earns $30M

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Ionis Pharmaceuticals, Inc. (IONS - Free Report) announced that it has out-licensed IONIS-AZ5-2.5Rx, a Generation 2.5 antisense drug, to AstraZeneca (AZN - Free Report) . The candidate will be developed to treat a genetically associated form of kidney disease.

AstraZeneca will be responsible for the development and commercialization of the candidate, going forward. Ionis entered a strategic collaboration with AstraZeneca in 2012 to develop treatment for cardiovascular, metabolic and renal diseases. This is the second drug to enter development under this agreement.

Per the terms of the deal, Ionis will receive an upfront payment of $30 million from AstraZeneca and is eligible to receive up to $300 million in the form of milestone payments and royalty payments on potential sales.

Ionis’s shares have risen 9.5% in the past year, outperforming the industry’s gain of 1.8% in that period.

Ionis has collaboration agreements with several pharma companies to whom it licenses and sells its technology on an exclusive or non-exclusive basis for fees and payments.

Ionis earns the majority of its revenues in the form of royalty from Biogen (BIIB - Free Report) on sales of spinal muscular atrophy drug, Spinraza. The drug was developed using Ionis’ antisense technology. Several other candidates are under development in collaboration with Biogen.

We note that in August 2017, Ionis retained all rights to its lead pipeline candidate, Inotersen, as Glaxo (GSK - Free Report) declined its option to develop the drug. Investors cheered the news as Ionis will record full sales instead of royalties upon successful commercialization, which is expected in 2018.

Ionis is scheduled to report its fourth quarter and full year 2017 results on Feb 27. We expect to get updates on its various pipeline candidates.

Zacks Rank

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

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