Full Press Release Details
Ionis reports second quarter 2020 financial results and recent business achievements
On track to achieve 2020 objectives and financial guidance
Webcast today, August 5, 2020, at 11:30 a.m. Eastern Time
CARLSBAD, Calif., August 5, 2020 - Ionis Pharmaceuticals, Inc. (Nasdaq: IONS)
today reported its financial results for the second quarter of 2020 and recent business highlights.
"The first half of this year was marked by numerous important achievements. Our Phase 3 programs progressed, we advanced our cardio-renal, metabolic and neurological
disease franchises and added new medicines to our Ionis-owned pipeline. Together, these catalysts moved us closer to delivering 10 or more marketing applications through 2025, which we expect to result in a number of new commercial medicines. In
the second half of this year, we are expanding the reach of our technology in neurological and pulmonary diseases, as studies in sporadic ALS and COPD get underway. We also look forward to proof-of-concept data from additional mid-stage programs,"
said Brett P. Monia, Ph.D., chief executive officer at Ionis. "Our achievements, together with our significant financial resources, position us to realize my vision for Ionis - to lead in the delivery of transformational medicines for patients
Second Quarter 2020 Financial Results and Highlights
"We ended the second quarter with net income on a non-GAAP basis, an increase compared to our first quarter results. Looking ahead, we are
maintaining our 2020 financial guidance and expect revenue and earnings growth in the second half of this year. With our substantial resources, we are well positioned to continue executing on our ambitious agenda and to deliver increasing value
near-term and into the future," said Elizabeth L. Hougen, chief financial officer of Ionis.
All non-GAAP amounts referred to in this press release exclude non-cash compensation expense related to equity awards. Please refer to the reconciliation of non-GAAP
and GAAP measures, which is provided later in this release.
Commercial Medicine Highlights
Second Quarter 2020 and Recent Pipeline Highlights
Ionis' revenue was comprised of the following (amounts in millions):
| Three months ended, June 30, | Six months ended June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| Revenue: | ||||||||||||||||
| Commercial revenue: | ||||||||||||||||
| SPINRAZA royalties | $ | 72 | $ | 71 | $ | 138 | $ | 130 | ||||||||
| Product sales, net | 16 | 10 | 32 | 17 | ||||||||||||
| Licensing and royalty revenue | 2 | 7 | 4 | 9 | ||||||||||||
| Total commercial revenue | 90 | 88 | 174 | 156 | ||||||||||||
| R&D Revenue: | ||||||||||||||||
| Amortization from upfront payments | 28 | 41 | 49 | 75 | ||||||||||||
| Milestone payments | 7 | 12 | 30 | 52 | ||||||||||||
| License fees | 15 | 22 | 15 | 173 | ||||||||||||
| Other services | 6 | 1 | 11 | 5 | ||||||||||||
| Total R&D revenue | 56 | 76 | 105 | 305 | ||||||||||||
| Total revenue | $ | 146 | $ | 164 | $ | 279 | $ | 461 |
Ionis' operating expenses for the second quarter of 2020 increased compared to the same period in 2019 driven by its investments in advancing its strategic priorities,
including advancing the Phase 3 program for AKCEA-TTR-LRx and other medicines in its Ionis-owned pipeline.
Net Loss Attributable to Noncontrolling Interest in Akcea
At June 30, 2020, Ionis owned approximately 76 percent of Akcea. The Company's net loss attributable to noncontrolling interest in Akcea for the second quarter of 2020
was consistent with the same period last year. The line titled "Net loss attributable to noncontrolling interest in Akcea" on Ionis' statement of operations reflects the portion
of Akcea's net income or loss attributable to the other owners of Akcea's common stock.
Net Income (Loss) Attributable to Ionis Common Stockholders
Ionis' net loss attributable to Ionis' common stockholders for the second quarter of 2020 was larger compared to the same period in 2019 primarily due to higher
revenue and lower operating expenses in the same period last year.
Ionis ended June 2020 with cash, cash equivalents and short-term investments of more than $2.3 billion, compared to $2.5 billion at
Today, at 11:30 a.m. Eastern Time, Ionis will conduct a live webcast to discuss this earnings release and related activities. Interested parties may access the webcast
here. A webcast replay will be available for a limited time at the same address.
About Ionis Pharmaceuticals, Inc.
As the leader in RNA-targeted drug discovery and development, Ionis has created an efficient, broadly applicable, drug discovery platform called
antisense technology that can treat diseases where no other therapeutic approaches have proven effective. Our drug discovery platform has served as a springboard for actionable promise and realized hope for patients with unmet needs. We created the
first and only approved treatment for children and adults with spinal muscular atrophy as well as the world's first RNA-targeted therapeutic approved for the treatment of polyneuropathy in adults with hereditary transthyretin amyloidosis. Our
sights are set on all the patients we have yet to reach with a pipeline of more than 40 novel medicines designed to potentially treat a broad range of diseases, including neurological, cardio-renal, metabolic, infectious, and pulmonary diseases.
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) and WAYLIVRA (volanesorsen) and Ionis' technologies and products in development, including the business of Akcea Therapeutics, Inc., Ionis' majority-owned affiliate. 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 related to the impact
COVID-19 could have on our business, and including but not limited to those related to our commercial products and the medicines in our pipeline, and particularly 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, 2019, and the most recent Form 10-Q quarterly filing, which are on file with the SEC. 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" refers to Ionis Pharmaceuticals and its subsidiaries.
Ionis Pharmaceuticals is a 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 Pharmaceuticals Investor Contact:
D. Wade Walke, Ph.D.
Vice President, Investor Relations
Ionis Pharmaceuticals Media Contact:
Vice President, Corporate Communications
IONIS PHARMACEUTICALS, INC.
SELECTED FINANCIAL INFORMATION
Condensed Consolidated Statements of Operations
(In Millions, Except Per Share Data)
| Three months ended, June 30, | Six months ended, June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| (unaudited) | ||||||||||||||||
| Revenue: | ||||||||||||||||
| Commercial revenue: | ||||||||||||||||
| SPINRAZA royalties | $ | 72 | $ | 71 | $ | 138 | $ | 130 | ||||||||
| Product sales, net | 16 | 10 | 32 | 17 | ||||||||||||
| Licensing and royalty revenue | 2 | 7 | 4 | 9 | ||||||||||||
| Total commercial revenue | 90 | 88 | 174 | 156 | ||||||||||||
| Research and development revenue under collaborative agreements | 56 | 76 | 105 | 305 | ||||||||||||
| Total revenue | 146 | 164 | 279 | 461 | ||||||||||||
| Expenses: | ||||||||||||||||
| Cost of products sold | 3 | 1 | 6 | 2 | ||||||||||||
| Research, development and patent | 122 | 106 | 239 | 213 | ||||||||||||
| Selling, general and administrative | 73 | 76 | 147 | 143 | ||||||||||||
| Total operating expenses | 198 | 183 | 392 | 358 | ||||||||||||
| Income (loss) from operations | (52 | ) | (19 | ) | (113 | ) | 103 | |||||||||
| Other income, net | 8 | 2 | 7 | 2 | ||||||||||||
| Income (loss) before income tax benefit (expense) | (44 | ) | (17 | ) | (106 | ) | 105 | |||||||||
| Income tax benefit (expense) | - | 7 | 4 | (24 | ) | |||||||||||
| Net income (loss) | $ | (44 | ) | $ | (10 | ) | $ | (102 | ) | $ | 81 | |||||
| Net loss attributable to noncontrolling interest in Akcea Therapeutics, Inc. | 12 | 9 | 22 | 3 | ||||||||||||
| Net income (loss) attributable to Ionis Pharmaceuticals, Inc. common stockholders | $ | (32 | ) | $ | (1 | ) | $ | (80 | ) | $ | 84 | |||||
| Basic net income (loss) per share | $ | (0.23 | ) | $ | (0.01 | ) | $ | (0.58 | ) | $ | 0.62 | |||||
| Diluted net income (loss) per share | $ | (0.23 | ) | $ | (0.01 | ) | $ | (0.58 | ) | $ | 0.61 | |||||
| Shares used in computing basic net income (loss) per share | 139 | 140 | 139 | 139 | ||||||||||||
| Shares used in computing diluted net income (loss) per share | 139 | 140 | 139 | 142 |
IONIS PHARMACEUTICALS, INC.
SELECTED FINANCIAL INFORMATION
Condensed Consolidating Statement of Operations
| Six months ended, June 30, 2020 (unaudited) | ||||||||||||||||
| Ionis | Akcea | Eliminations | Ionis Consolidated | |||||||||||||
| Revenue: | ||||||||||||||||
| Commercial revenue: | ||||||||||||||||
| SPINRAZA royalties | $ | $138 | $ | - | $ | - | $ | 138 | ||||||||
| Product sales, net | - | 32 | - | 32 | ||||||||||||
| Licensing and royalty revenue | 4 | - | - | 4 | ||||||||||||
| Total commercial revenue | 142 | 32 | - | 174 | ||||||||||||
| Research and development revenue under collaborative agreements | 98 | 7 | - | 105 | ||||||||||||
| Intercompany revenue | 7 | - | (7 | ) | - | |||||||||||
| Total revenue | 247 | 39 | (7 | ) | 279 | |||||||||||
| Expenses: | ||||||||||||||||
| Cost of products sold | - | 10 | (4 | ) | 6 | |||||||||||
| Research, development and patent expenses | 197 | 47 | (5 | ) | 239 | |||||||||||
| Selling, general and administrative | 59 | 88 | - | 147 | ||||||||||||
| Profit/ loss share for TEGSEDI commercialization activities | 10 | (10 | ) | - | - | |||||||||||
| Total operating expenses | 266 | 135 | (9 | ) | 392 | |||||||||||
| Loss from operations | (19 | ) | (96 | ) | 2 | (113 | ) | |||||||||
| Other income, net | 4 | 3 | - | 7 | ||||||||||||
| Loss before income tax benefit | (15 | ) | (93 | ) | 2 | (106 | ) | |||||||||
| Income tax benefit | 3 | 1 | - | 4 | ||||||||||||
| Net loss | $ | (12 | ) | $ | (92 | ) | $ | 2 | $ | (102 | ) | |||||
| Net loss attributable to noncontrolling interest in Akcea Therapeutics, Inc. | $ | - | $ | - | $ | 22 | $ | 22 | ||||||||
| Net loss attributable to Ionis Pharmaceuticals, Inc. common stockholders | $ | (12 | ) | $ | (92 | ) | $ | 24 | $ | (80 | ) |
IONIS PHARMACEUTICALS, INC.
Reconciliation of GAAP to Non-GAAP Basis:
Condensed Consolidated Operating Expenses, Income (Loss) From Operations, and Net Income (Loss)
| Three months ended, June 30 , | Six months ended, June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| (unaudited) | ||||||||||||||||
| As reported research, development and patent expenses according to GAAP | $ | 122 | $ | 106 | $ | 239 | $ | 213 | ||||||||
| Excluding compensation expense related to equity awards | (26 | ) | (24 | ) | (52 | ) | (49 | ) | ||||||||
| Non-GAAP research, development and patent expenses | $ | 96 | $ | 82 | $ | 187 | $ | 164 | ||||||||
| As reported selling, general and administrative expenses according to GAAP | $ | 73 | $ | 76 | $ | 147 | $ | 143 | ||||||||
| Excluding compensation expense related to equity awards | (22 | ) | (18 | ) | (37 | ) | (39 | ) | ||||||||
| Non-GAAP selling, general and administrative expenses | $ | 51 | $ | 58 | $ | 110 | $ | 104 | ||||||||
| As reported operating expenses according to GAAP | $ | 198 | $ | 183 | $ | 392 | $ | 358 | ||||||||
| Excluding compensation expense related to equity awards | (48 | ) | (42 | ) | (89 | ) | (87 | ) | ||||||||
| Non-GAAP operating expenses | $ | 150 | $ | 141 | $ | 303 | $ | 271 | ||||||||
| As reported income (loss) from operations according to GAAP | $ | (52 | ) | $ | (19 | ) | $ | (113 | ) | $ | 103 | |||||
| Excluding compensation expense related to equity awards | (48 | ) | (42 | ) | (89 | ) | (87 | ) | ||||||||
| Non-GAAP income (loss) from operations | $ | (4 | ) | $ | 23 | $ | (24 | ) | $ | 190 | ||||||
| As reported net income (loss) attributable to Ionis Pharmaceuticals, Inc. common stockholders according to GAAP | $ | (32 | ) | $ | (1 | ) | $ | (80 | ) | $ | 84 | |||||
| Excluding compensation expense related to equity awards attributable to Ionis Pharmaceuticals, Inc. common stockholders | (45 | ) | (39 | ) | (84 | ) | (78 | ) | ||||||||
| Income tax effect related to compensation expense related to equity awards attributable to Ionis Pharmaceuticals, Inc. common stockholders | 5 | 14 | 11 | 13 | ||||||||||||
| Non-GAAP net income (loss) attributable to Ionis Pharmaceuticals, Inc. common stockholders according to GAAP | $ | 8 | $ | 24 | $ | (7 | ) | $ | 149 |
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) attributable to Ionis Pharmaceuticals, Inc. common shareholders were adjusted from GAAP to exclude compensation expense related to equity awards and the related tax effect. Compensation expense related to equity awards are non-cash.
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.
Condensed Consolidated Balance Sheets
| June 30, 2020 | December 31, 2019 | |||||||
| (unaudited) | ||||||||
| Assets: | ||||||||
| Cash, cash equivalents and short-term investments | $ | 2,349 | $ | 2,500 | ||||
| Contracts receivable | 28 | 63 | ||||||
| Other current assets | 155 | 158 | ||||||
| Property, plant and equipment, net | 173 | 154 | ||||||
| Other assets | 374 | 358 | ||||||
| Total assets | $ | 3,079 | $ | 3,233 | ||||
| Liabilities and stockholders' equity: | ||||||||
| Other current liabilities | $ | 132 | $ | 155 | ||||
| Current portion of deferred contract revenue | 100 | 118 | ||||||
| 0.125% convertible senior notes | 445 | 435 | ||||||
| 1% convertible senior notes | 284 | 275 | ||||||
| Long-term obligations, less current portion | 75 | 75 | ||||||
| Long-term deferred contract revenue | 448 | 490 | ||||||
| Total Ionis stockholders' equity | 1,377 | 1,471 | ||||||
| Noncontrolling interest in Akcea Therapeutics, Inc. | 218 | 214 | ||||||
| Total stockholders' equity | $ | 1,595 | $ | 1,685 | ||||
| Total liabilities and stockholders' equity | $ | 3,079 | $ | 3,233 |
IONIS PHARMACEUTICALS, INC.
Condensed Consolidating Balance Sheet
| June 30, 2020 (unaudited) | ||||||||||||||||
| Ionis | Akcea | Eliminations | Ionis Consolidated | |||||||||||||
| Assets: | ||||||||||||||||
| Cash, cash equivalents and short-term investments | $ | 1,959 | $ | 390 | $ | - | $ | 2,349 | ||||||||
| Contracts receivable | 14 | 14 | - | 28 | ||||||||||||
| Other current assets | 136 | 24 | (5 | ) | 155 | |||||||||||
| Property, plant and equipment, net | 167 | 6 | - | 173 | ||||||||||||
| Other assets | 1,122 | 94 | (842 | ) | 374 | |||||||||||
| Total assets | $ | 3,398 | $ | 528 | $ | (847 | ) | $ | 3,079 | |||||||
| Liabilities and stockholders' equity: | ||||||||||||||||
| Other current liabilities | $ | 102 | $ | 35 | $ | (5 | ) | $ | 132 | |||||||
| Current portion of deferred contract revenue | 100 | - | - | 100 | ||||||||||||
| 0.125% convertible senior notes | 445 | - | - | 445 | ||||||||||||
| 1% convertible senior notes | 284 | - | - | 284 | ||||||||||||
| Long-term obligations, less current portion | 61 | 14 | - | 75 | ||||||||||||
| Long-term deferred contract revenue | 451 | - | (3 | ) | 448 | |||||||||||
| Total stockholders' equity before noncontrolling interest | 1,955 | 479 | (1,057 | ) | 1,377 | |||||||||||
| Noncontrolling interest in Akcea Therapeutics, Inc. | - | - | 218 | 218 | ||||||||||||
| Total stockholders' equity | $ | 1,955 | $ | 479 | $ | (839 | ) | $ | 1,595 | |||||||
| Total liabilities and stockholders' equity | $ | 3,398 | $ | 528 | $ | (847 | ) | $ | 3,079 |