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Ionis (IONS) Q3 Earnings & Sales Beat Estimates, Stock Up

Ionis Pharmaceuticals IONS reported a loss of 33 cents per share in third-quarter 2022, narrower than the Zacks Consensus Estimate of a loss of 74 cents. In the year-ago quarter, the company incurred a loss of 58 cents 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 16 cents versus 34 cents in the year-ago quarter.

Ionis reported total revenues of $160 million in the second quarter, up 20% year over year due to higher R&D revenues, which more than offset the lower commercial revenues. Sales also beat the Zacks Consensus Estimate of $151.0 million.

Ionis’ shares were up 1.9% on Nov 9 in response to the encouraging third-quarter results. This year so far, Ionis’ shares have surged 41.5% against the industry’s decline of 32.7%.

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Quarter in Detail

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

Commercial revenues were $73 million in the second quarter, down 15% year over year.

Commercial revenues from Spinraza royalties were $62 million, down 7% year over, due to rising competition in international markets and currency headwinds. Ionis has licensed Spinraza to Biogen. Biogen is responsible for commercializing Spinraza, approved for treating spinal muscular atrophy (SMA) worldwide. Ionis receives royalties from Biogen on Spinraza’s sales.

Revenues from Tegsedi and Waylivra from distribution fees were $6 million compared with $15 million in the year-ago quarter. License and royalty revenues were $5 million in the quarter compared with $3 million in the year-ago quarter.

R&D revenues of $87 million were higher than the year-ago revenues of $48 million, driven by significant partner payments Ionis earned across multiple partnered programs.

Adjusted operating costs were up 5.4% year over year to $195 million in the third quarter, mainly driven by higher R&D costs as the company rapidly advanced its wholly-owned late-stage pipeline. Ionis’ phase III studies doubled throughout 2021 from three to six. The SG&A expenses increased go-to-market activities for its late-stage pipeline candidates.

2022 Guidance

Ionis maintained its previously issued financial guidance for the year. The company expects total revenues to be more than $575 million in 2022. Its adjusted net loss is expected to be less than $275 million.

Adjusted operating expense is expected to be in the range of $825 million to $850 million. R&D costs are expected to increase in the range of 25-30% in 2022 compared with 2021. SG&A costs are expected to be in line with 2021.

The company, however, raised its cash and investment guidance to approximately $2 billion from the previous guidance of $1.7 billion.

Pipeline Update

Ionis has phase III studies ongoing for six medicines (internal as well as partnered) across eight indications. The medicines include tofersen for SOD1-ALS (amyotrophic lateral sclerosis), pelacarsen for cardiovascular disease due to elevated Lp(a) levels, olezarsen for familial chylomicronemia syndrome (FCS) and severe hypertriglyceridemia (SHTG), eplontersen for TTR amyloidosis, ION363 for ALS, with mutations in the fused in sarcoma gene (FUS) or FUS-ALS and donidalorsen for hereditary angioedema (HAE).

Biogen, AstraZeneca AZN and Novartis are its partners for tofersen, eplontersen and pelacarsen. In June 2022, Ionis announced that the phase III NEURO-TTRansform study evaluating eplontersen in TTR polyneuropathy achieved its primary and key secondary endpoints. Based on these results, Ionis and AstraZeneca will file a new drug application (NDA) seeking approval of eplontersen for TTR polyneuropathy later this year. Ionis and AstraZeneca are also developing eplontersen for the treatment of cardiomyopathy in the phase III CARDIO-TTRansform study.

An NDA for Biogen/Ionis’ tofersen in SOD1-ALS is currently under FDA’s priority review and a decision is expected by April 25, 2023.

Ionis is developing olezarsen for FCS, ION363 for FUS-ALS and donidalorsen for HAE on its own in pivotal late-stage studies. Management is advancing and expanding its wholly-owned pipeline to drive future revenue growth and data from several of these programs is expected before this year’s end.

Earlier this week, Ionis’ partner GSK GSK announced positive data from a phase IIb study evaluating bepirovirsen as a potential treatment for patients with chronic hepatitis B virus (CHB). Data from the study showed that treatment with the GSK-partnered drug resulted in sustained clearance of hepatitis B surface antigen (HBsAg) and virus DNA for 24 weeks after the end of bepirovirsen treatment in CHB patients. Based on these results, GSK plans to advance the candidate into late-stage development by first-half 2023. GSK licensed bepirovirsen from Ionis in August 2019.

Ionis Pharmaceuticals, Inc. Price


Ionis Pharmaceuticals, Inc. Price
Ionis Pharmaceuticals, Inc. Price

Ionis Pharmaceuticals, Inc. price | Ionis Pharmaceuticals, Inc. Quote


Zacks Rank

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

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