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Why Is Ionis Pharmaceuticals (IONS) Down 8.4% Since Last Earnings Report?

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It has been about a month since the last earnings report for Ionis Pharmaceuticals (IONS - Free Report) . Shares have lost about 8.4% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Ionis Pharmaceuticals due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

Q4 Earnings Tops Estimates, Sales Lag

Ionis reported a loss of 37 cents per share for fourth-quarter 2022, much narrower than the Zacks Consensus Estimate of a loss of $1.06 and our estimate of $1.08 per share. In the year-ago quarter, the company had reported earnings of $1.41 per share.

The bottom line includes expenses related to the Akcea acquisition and restructured European and North American operations and other items. Excluding these non-recurring expenses, the loss per share was $1.18 per share versus a gain of $1.55 per share in the year-ago quarter.

Total revenues were $152 million in the fourth quarter, which missed the Zacks Consensus Estimate of $158.0 million but beat our estimate of $141.7 million. Fourth-quarter revenues were significantly less than $440 million in the year-ago quarter due to the recognition of a $200 million payment from partner AstraZeneca to jointly develop and commercialize eplontersen in the fourth quarter of 2021.

Quarter in Detail

Ionis earns commercial revenues, primarily royalty payments on net sales of Spinraza and R&D revenues from partnered medicines.

Commercial revenues were $80 million in the fourth quarter, down 8% year over year.

Commercial revenues from Spinraza royalties were $67 million, down 2.9% year over, due to rising competition in international markets and currency headwinds.

Revenues from Tegsedi and Waylivra from distribution fees were $7 million compared with $9 million in the year-ago quarter. License and royalty revenues were $6 million in the quarter compared with $9 million in the year-ago quarter.

R&D revenues of $72 million were much less than the year-ago revenues of $353 million due to the payment from AstraZeneca for eplontersen in the year-ago quarter.

Adjusted operating costs were up 70.9% year over year to $335 million in the fourth quarter, mainly driven by higher R&D costs as the company rapidly advances its wholly-owned late-stage pipeline and due to increased go-to-market activities for eplontersen, olezarsen and donidalorsen.

2023 Guidance

Ionis issued fresh financial guidance for 2023. The company expects total revenues to be more than $575 million in 2023. The guidance was much less than the Zacks Consensus Estimate of total revenues of $731.5 million.

Its adjusted operating loss is expected to be less than $425 million.

Adjusted operating expense is expected to be in the range of $970-$995 million. R&D costs are expected to increase in the range of 20-25% year over year in 2023. SG&A costs are expected to increase approximately 25% to 30% year-over-year.

The company expects its cash and investment to be approximately $2 billion in 2023.

How Have Estimates Been Moving Since Then?

It turns out, estimates revision have trended downward during the past month.

The consensus estimate has shifted -24742.88% due to these changes.

VGM Scores

At this time, Ionis Pharmaceuticals has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.


Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Ionis Pharmaceuticals has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

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