Full Press Release Details
Ionis reports fourth quarter and full year 2022 financial results
Eplontersen NDA submitted to FDA; tofersen under regulatory review for marketing approval in U.S. and EU
Phase 3 data planned for eplontersen and olezarsen; robust late-stage pipeline expanding with two new Phase 3 programs
Ionis provides full year 2023 financial guidance
CARLSBAD, Calif., February 22, 2023 - Ionis
Pharmaceuticals, Inc. (Nasdaq: IONS) (the "Company"), a genetic medicines company, today reported financial results for the fourth quarter and full year ended December 31, 2022. Financial results are summarized below:
| Three months ended December 31, | Year ended December 31, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| (amounts in millions) | ||||||||||||||||
| Total revenue | $ | 152 | $ | 440 | $ | 587 | $ | 810 | ||||||||
| Operating expenses | $ | 360 | $ | 219 | $ | 998 | $ | 840 | ||||||||
| Operating expenses on a non-GAAP basis | $ | 335 | $ | 196 | $ | 898 | $ | 695 | ||||||||
| Net (loss) income | $ | (52 | ) | $ | 225 | $ | (270 | ) | $ | (29 | ) | |||||
| Net (loss) income on a non-GAAP basis | $ | (168 | ) | $ | 248 | $ | (311 | ) | $ | 116 | ||||||
| Cash, cash equivalents and short-term investments 1 | $ | 1,987 | $ | 2,115 |
Financial Highlights
Recent Late-Stage Pipeline Highlights
Recent Additional Pipeline Highlights
Recent Technology Advancement Highlights
"We made substantial progress in 2022, marked by important achievements, including the December submission of the eplontersen NDA for people with ATTRv-PN. We also
delivered multiple positive data readouts, enabling us to advance and expand our rich late- and mid-stage pipeline. And we took important steps to expand and diversify our technology, including our Metagenomi collaboration to add DNA editing to our
platform," said Brett P. Monia, Ph.D., chief executive officer of Ionis. "As we start 2023, we are positioned to build upon our achievements by bringing our first near-term
commercial opportunities to the market. We look forward to reporting the 66-week results from the eplontersen NEURO-TTRansform study in the first
half of this year. Importantly, we are prepared to co-commercialization eplontersen with our partner, AstraZeneca. We also look forward to Phase 3 data from olezarsen in FCS patients, positioning us for our first independent launch. With the talent and resources we have
today, we anticipate a highly productive year that will enable us to drive increasing value for all stakeholders."
Fourth Quarter and Full Year 2022 Financial Results
Ionis' revenue was comprised of the following:
| Three months ended December 31, | Year ended December 31, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Revenue: | (amounts in millions) | |||||||||||||||
| Commercial revenue: | ||||||||||||||||
| SPINRAZA royalties | $ | 67 | $ | 69 | $ | 242 | $ | 268 | ||||||||
| TEGSEDI and WAYLIVRA revenue, net | 7 | 9 | 30 | 56 | ||||||||||||
| Licensing and royalty revenue | 6 | 9 | 31 | 18 | ||||||||||||
| Total commercial revenue | 80 | 87 | 303 | 342 | ||||||||||||
| Research and development revenue: | ||||||||||||||||
| Amortization from upfront payments | 15 | 21 | 69 | 78 | ||||||||||||
| Milestone payments | 14 | 40 | 74 | 88 | ||||||||||||
| License fees | - | 290 | 37 | 291 | ||||||||||||
| Other services | 22 | 2 | 27 | 11 | ||||||||||||
| Collaborative agreement revenue | 51 | 353 | 207 | 468 | ||||||||||||
| Eplontersen joint development revenue | 21 | - | 77 | - | ||||||||||||
| Total research and development revenue | 72 | 353 | 284 | 468 | ||||||||||||
| Total revenue | $ | 152 | $ | 440 | $ | 587 | $ | 810 |
Ionis' 2022 revenue continued to be derived from diverse sources, with just over half coming from commercial products and the balance from numerous partnered programs.
SPINRAZA royalties, the largest contributor to the Company's commercial revenue, increased each quarter in 2022. Total SPINRAZA product sales increased six percent in the fourth quarter of 2022 compared to the prior quarter and also increased four
percent compared to the same quarter in 2021. The increases were driven by stabilization in the U.S. and growth in Asian markets partially offset by competition in Europe. Total SPINRAZA product sales decreased six percent year-over-year due to
foreign currency exchange and competition in Europe. TEGSEDI and WAYLIVRA revenue in 2022 reflected the shift to distribution fees.
R&D revenue for 2022 included $112 million from Biogen for advancing several neurology disease programs, $77 million from AstraZeneca for its share of the global
Phase 3 development costs for eplontersen and $64 million from Roche for licensing and advancing IONIS-FB-LRx, among other partner payments. R&D revenue was higher in 2021 compared to 2022 primarily due to the $200 million Ionis earned in the fourth quarter of 2021 from
AstraZeneca to jointly develop and commercialize eplontersen.
Ionis' operating expenses increased for the three months and year ended December 31, 2022 compared to the same periods in 2021, in line with expectations. For both
periods, higher R&D expenses were driven by the increased number of Phase 3 studies the Company is conducting, which doubled from three to six studies in 2021, and the $80 million upfront
payment for Ionis' collaboration with Metagenomi. SG&A expenses increased for the three months ended December 31, 2022 compared to the same period in 2021 driven by Ionis' go-to-market activities for eplontersen, olezarsen and donidalorsen.
SG&A expenses were lower for 2022 compared to 2021 largely due to the substantial savings the Company achieved from integrating Akcea and restructuring the Company's commercial operations in 2021.
Gain on Sale of Property and Related Tax Impact
In October 2022, Ionis entered into a sale and leaseback transaction for several of its real estate assets. Under the agreement, Ionis received net proceeds of $200 million, with the potential to receive additional payments of up to $40 million plus funding to expand the Company's R&D campus. As a result, the Company recognized a $150 million gain on sale
of property and $9 million in related income tax expense in the fourth quarter of 2022. In conjunction with the sale and leaseback transaction, the Company extinguished its mortgage debt for the related properties and recorded a new right of lease
asset and liability on its balance sheet.
As of December 31, 2022, Ionis had cash, cash equivalents and short-term investments of $2.0 billion compared to $2.1 billion at December 31, 2021. Ionis' year-end cash
balance does not include the $500 million the Company received from Royalty Pharma in January 2023. From December 31, 2021 to December 31, 2022, Ionis' debt obligations decreased by $50 million because the Company repaid its mortgage debt and Ionis'
working capital decreased modestly driven by the Company's slightly lower cash and short-term investments balance.
2023 Financial Guidance
The Company's 2023 guidance reflects its ability to earn substantial revenue from its commercial portfolio and partnered programs. It also reflects the Company's
commitment to investing in advancing its rich late-stage pipeline and preparing to commercialize its near-term commercial opportunities, eplontersen, olezarsen and donidalorsen, while maintaining a healthy balance sheet to continue investing for
| Full Year 2023 Guidance | |
| Revenue | >$575 million |
| Operating expenses on a non-GAAP basis | ~$970 - $995 million |
| Net operating loss on a non-GAAP basis | <$425 million |
| Cash, cash equivalents and short-term investments | ~$2.0 billion |
"Our solid 2022 financial results reflected our ability to earn substantial revenues while investing in key programs with the potential to drive substantial future
growth, including our near-term commercial opportunities," said Elizabeth L. Hougen, chief financial officer of Ionis. "Additionally, we recently bolstered our balance sheet with more than $700
million from our royalty monetization and sale and leaseback transactions. With approximately $2.5 billion in pro forma cash, we have the resources to continue to advance our innovative pipeline
and achieve commercial readiness for eplontersen, olezarsen and donidalorsen."
Management will host a conference call and webcast to discuss Ionis' fourth quarter and full year 2022 results at 11:30 a.m. Eastern time on Wednesday, February 22,
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 fourth quarter
and full year 2022 earnings slides click here.
About Ionis Pharmaceuticals, Inc.
For more than 30 years, Ionis has been the leader in RNA-targeted therapy, pioneering new markets and changing the standards of care with its novel
antisense technology. Ionis currently has three marketed medicines and a premier late-stage pipeline highlighted by industry leading cardiovascular and neurological franchises. Our scientific innovation began and continues with the knowledge that
sick people depend on us, which fuels our vision of becoming the leader in genetic medicine, utilizing a multi-platform approach to discover, develop and deliver life-transforming therapies.
Ionis' Forward-looking Statement
This press release includes forward-looking statements regarding Ionis' business, financial guidance and the therapeutic and commercial potential of SPINRAZA
(nusinersen), TEGSEDI (inotersen), WAYLIVRA (volanesorsen), eplontersen, olezarsen, donidalorsen, ION363, tofersen, pelacarsen, bepirovirsen, Ionis' technologies and Ionis' other products in development. Any statement describing Ionis' 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 including those inherent in the process
of discovering, developing and commercializing medicines that are safe and effective for use as human therapeutics, and in the endeavor of building a business around such medicines. Ionis' 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 Ionis' forward-looking statements reflect the good faith judgment of its management,
these statements are based only on facts and factors currently known by Ionis. As a result, you are cautioned not to rely on these forward-looking statements. These and other risks concerning Ionis' programs are described in additional detail in
Ionis' annual report on Form 10-K for the year ended December 31, 2021, and most recent Form 10-Q, which are on file with the Securities and Exchange Commission. Copies of these and other documents are available from the Company.
In this press release, unless the context requires otherwise, "Ionis," "Company," "we," "our" and "us" all refer to Ionis Pharmaceuticals and its subsidiaries.
Ionis Pharmaceuticals is a registered trademark of Ionis Pharmaceuticals, Inc. Akcea Therapeutics is a registered trademark of Akcea
Therapeutics, Inc. TEGSEDI is a registered trademark of Akcea Therapeutics, Inc. WAYLIVRA is a registered trademark of Akcea Therapeutics, Inc. SPINRAZA is a registered trademark of Biogen.
Ionis Investor Contact:
info@ionisph.com 760-603-2331
Ionis Media Contact:
ionis_ca@ionisph.com 760-603-4679
IONIS PHARMACEUTICALS, INC.
SELECTED FINANCIAL INFORMATION
Condensed Consolidated Statements of Operations
(In Millions, Except Per Share Data)
| Three months ended, December 31, | Year ended December 31, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| (unaudited) | ||||||||||||||||
| Revenue: | ||||||||||||||||
| Commercial revenue: | ||||||||||||||||
| SPINRAZA royalties | $ | 67 | $ | 69 | $ | 242 | $ | 268 | ||||||||
| TEGSEDI and WAYLIVRA revenue, net | 7 | 9 | 30 | 56 | ||||||||||||
| Licensing and royalty revenue | 6 | 9 | 31 | 18 | ||||||||||||
| Total commercial revenue | 80 | 87 | 303 | 342 | ||||||||||||
| Research and development revenue: | ||||||||||||||||
| Collaborative agreement revenue | 51 | 353 | 207 | 468 | ||||||||||||
| Eplontersen joint development revenue | 21 | - | 77 | - | ||||||||||||
| Total research and development revenue | 72 | 353 | 284 | 468 | ||||||||||||
| Total revenue | 152 | 440 | 587 | 810 | ||||||||||||
| Expenses: | ||||||||||||||||
| Cost of sales | 4 | 2 | 14 | 11 | ||||||||||||
| Research, development and patent | 308 | 179 | 833 | 643 | ||||||||||||
| Selling, general and administrative | 48 | 38 | 151 | 186 | ||||||||||||
| Total operating expenses | 360 | 219 | 998 | 840 | ||||||||||||
| Income (loss) from operations | (208 | ) | 221 | (411 | ) | (30 | ) | |||||||||
| Other income (expense): | ||||||||||||||||
| Gain on sale of real estate assets | 150 | - | 150 | - | ||||||||||||
| Other income, net | 14 | 4 | 3 | - | ||||||||||||
| Income (loss) before income tax benefit (expense) | (44 | ) | 225 | (258 | ) | (30 | ) | |||||||||
| Income tax benefit (expense) | (8 | ) | - | (12 | ) | 1 | ||||||||||
| Net income (loss) | $ | (52 | ) | $ | 225 | $ | (270 | ) | $ | (29 | ) | |||||
| Basic net income (loss) per share | $ | (0.37 | ) | $ | 1.59 | $ | (1.90 | ) | $ | (0.20 | ) | |||||
| Diluted net income (loss) per share | $ | (0.37 | ) | $ | 1.41 | $ | (1.90 | ) | $ | (0.20 | ) | |||||
| Shares used in computing basic net income (loss) per share | 142 | 141 | 142 | 141 | ||||||||||||
| Shares used in computing diluted net income (loss) per share | 142 | 160 | 142 | 141 |
IONIS PHARMACEUTICALS, INC.
Reconciliation of GAAP to Non-GAAP Basis:
Condensed Consolidated Operating Expenses, Income (Loss) From Operations, and Net Income
| Three months ended December 31 , | Year ended December 31, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| (unaudited) | ||||||||||||||||
| As reported research, development and patent expenses according to GAAP | $ | 308 | $ | 179 | $ | 833 | $ | 643 | ||||||||
| Excluding compensation expense related to equity awards | (19 | ) | (16 | ) | (74 | ) | (88 | ) | ||||||||
| Excluding Akcea merger and restructured commercial operation costs* | - | (1 | ) | - | (9 | ) | ||||||||||
| Non-GAAP research, development and patent expenses | $ | 289 | $ | 162 | $ | 759 | $ | 546 | ||||||||
| As reported selling, general and administrative expenses according to GAAP | $ | 48 | $ | 38 | $ | 151 | $ | 186 | ||||||||
| Excluding compensation expense related to equity awards | (7 | ) | (7 | ) | (26 | ) | (33 | ) | ||||||||
| Excluding Akcea merger and restructured commercial operation costs* | - | 1 | - | (15 | ) | |||||||||||
| Non-GAAP selling, general and administrative expenses | $ | 41 | $ | 32 | $ | 125 | $ | 138 | ||||||||
| As reported operating expenses according to GAAP | $ | 36 0 | $ | 219 | $ | 998 | $ | 840 | ||||||||
| Excluding compensation expense related to equity awards | (25 | ) | (23 | ) | (100 | ) | (121 | ) | ||||||||
| Excluding Akcea merger and restructured commercial operation costs* | - | - | - | (24 | ) | |||||||||||
| Non-GAAP operating expenses | $ | 335 | $ | 196 | $ | 898 | $ | 695 | ||||||||
| As reported income (loss) from operations according to GAAP | $ | (208 | ) | $ | 221 | $ | (411 | ) | $ | (30 | ) | |||||
| Excluding compensation expense related to equity awards | (25 | ) | (23 | ) | (100 | ) | (121 | ) | ||||||||
| Excluding Akcea merger and restructured commercial operation costs* | - | - | - | (24 | ) | |||||||||||
| Non-GAAP income (loss) from operations | $ | (183 | ) | $ | 244 | $ | (311 | ) | $ | 115 | ||||||
| As reported net income (loss) according to GAAP | $ | (52 | ) | $ | 225 | $ | (270 | ) | $ | (29 | ) | |||||
| Excluding compensation expense related to equity awards | (25 | ) | (23 | ) | (100 | ) | (121 | ) | ||||||||
| Excluding Akcea merger and restructured commercial operation costs* | - | - | - | (24 | ) | |||||||||||
| Excluding gain on sale of real estate assets** | 150 | - | 150 | - | ||||||||||||
| Excluding income tax effect related to gain on sale of real estate assets | (9 | ) | - | (9 | ) | - | ||||||||||
| Non-GAAP net income (loss) | $ | (168 | ) | $ | 248 | $ | (311 | ) | $ | 116 |
*In October 2020, Ionis completed a merger transaction with Akcea such that following the completion of the merger Akcea became a wholly owned subsidiary of Ionis.
Additionally, in December 2020 and April 2021, Ionis restructured its European operations and its North American TEGSEDI operations, respectively, as a result of entering into distribution agreements with Sobi. The Company excluded the Akcea merger
and restructured commercial operation costs from its non-GAAP amounts for the applicable periods.
**In October 2022, Ionis entered into a sale and leaseback transaction for several of its real estate assets. As a result, the Company recognized a $150 million gain on
sale of real estate assets in the fourth quarter of 2022. The Company excluded the gain on sale of real estate assets and the related tax effect from its non-GAAP amounts for the applicable periods.
Reconciliation of GAAP to Non-GAAP Basis
As illustrated in the Selected Financial Information in this press release, non-GAAP operating expenses, non-GAAP income (loss) from operations, and non-GAAP net income
(loss) were adjusted from GAAP to exclude compensation expense related to equity awards and the related tax effects. Compensation expense related to equity awards are non-cash. In 2022 Ionis' non-GAAP net loss excluded the gain on property related to
the sale and leaseback transaction and the related tax effect. In 2021 all non-GAAP amounts also excluded expenses related to the Akcea merger and restructured commercial operations. Expenses
related to the Akcea merger and restructured commercial operations included: severance costs, retention costs and other costs related to commercial operations. Ionis has regularly reported non-GAAP measures for operating results as non-GAAP results.
These measures are provided as supplementary information and are not a substitute for financial measures calculated in accordance with GAAP. Ionis reports these non-GAAP 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 Ionis' non-GAAP results is consistent with how Ionis' management internally evaluates the performance of its operations.
IONIS PHARMACEUTICALS, INC.
Summary of the Financial Impacts of the Eplontersen Collaboration with AstraZeneca
For the Year Ended, December 31, 2022
| Collaboration Activities | Financial Statement Line | Impact of Cost-Sharing Provisions on Ionis' Statement of Operations | ||||
| Phase 3 Development: Ionis leads and conducts | Eplontersen Joint Development Revenue (R&D Revenue) | $77M | 55% of Total Phase 3 development expenses, including internal+external costs & CMC costs, net of Ionis' share of AstraZeneca's Phase 3 development expenses | |||
| Development Expenses (R&D Expenses) | $147M | 100% of Ionis' Phase 3 development expenses |
Ionis' financial results for the year ended December 31, 2022 reflected the cost-sharing provisions related to its collaboration with AstraZeneca to develop and
commercialize eplontersen for the treatment of ATTR. Under the terms of the collaboration agreement, AstraZeneca is currently paying 55 percent of the costs associated with the ongoing global Phase 3 development program. Because Ionis is leading and
conducting the Phase 3 development program, Ionis is recognizing the 55 percent of cost-share funding AstraZeneca is responsible for, net of Ionis' share of AstraZeneca's development expenses, as R&D revenue in the same period Ionis incurs the
related development expenses. For the year ended December 31, 2022 Ionis earned $77 million in joint development revenue under this collaboration.
Because AstraZeneca is responsible for the majority of the medical affairs and commercial costs in the U.S. and all costs associated with commercializing eplontersen
outside the U.S., Ionis is recognizing cost-share funding it receives from AstraZeneca related to these activities as a reduction of its medical affairs (R&D expenses) and commercialization expenses (SG&A expenses). For the year ended
December 31, 2022 Ionis recognized $2.0 million and $2.6 million of medical affairs expenses and commercialization expenses for eplontersen, respectively, net of cost-share funding from AstraZeneca. Ionis expects its medical affairs and