Ionis Pharmaceuticals, Inc. (IONS) Earnings Call Transcript & Summary

Good morning, and welcome to Ionis' conference call to discuss the eplontersen development and commercialization update. As a reminder, this call is being recorded. At this time, I would like to turn the call over to Jennifer Capuzelo, Investor Relations to lead off the call. Please begin.

Thank you, Tom. Hello, and thank you for joining us this morning for a discussion about our collaboration agreement with AstraZeneca for eplontersen. Before we begin, I encourage everyone to review the press release, Ionis issued last night, which outlines the details of this agreement. During this call, we will be making forward-looking statements that are based on our current expectations and beliefs. These statements are subject to certain risks and uncertainties, and our actual results may differ materially. I encourage you to consult the risk factors contained in our SEC filings for additional details. Joining me on today's call are Brett Monia, Chief Executive Officer; Onaiza Cadoret-Manier, Chief Corporate Development and Commercial Officer; and Beth Hougen, Chief Financial Officer. And with that, I'll turn the call over to Brett.

Thanks, Jen. Good morning, everyone, and thanks for joining us on today's call. Last night, we announced an important new collaboration with AstraZeneca to codevelop and co-commercialize eplontersen, our investigational medicine for the treatment of TTR amyloidosis. By teaming up with AstraZeneca, we're combining our industry-leading experience in RNA-targeted therapeutics and our deep knowledge of the TTR amyloidosis market, with AstraZeneca's global scale resources and leadership in cardiovascular disease. Together, we believe this positions us well to maximize patient value and win in this growing and competitive market. This agreement is an important step for Ionis. We and AstraZeneca will work jointly to deliver eplontersen to patients around the world, sharing responsibilities, capabilities and costs. And in addition to being the best strategy to potentially maximize eplontersen's commercial success, it simultaneously enables us to bolster our commercial organization, and accelerate preparations for our other near-term product launches, including olezarsen and donidalorsen to maximize their success in the market. TTR amyloidosis or ATTR is a systemic, progressive and fatal disease characterized by multiple overlapping clinical manifestations caused by the inappropriate formation and aggregation of TTR amyloid deposits in various tissues and organs. Eplontersen, which uses our LICA antisense technology is designed to reduce TTR protein production, the root cause of ATTR. In a Phase I healthy volunteer study, eplontersen reduced TTR protein at more than 90% with favorable safety and tolerability. And our LICA technology platform is well validated, having demonstrated robust clinical coefficacy and favorable safety and tolerability in more than 2,000 subjects treated to date. Based on these data, we and AstraZeneca are confident that eplontersen has the potential to change the standard of care for the estimated 300,000 to 500,000 patients with ATTR worldwide. In a moment, Onaiza will expand on our participation under this agreement, but here's a brief overview of how we'll collaborate with AstraZeneca. Ionis will continue to lead and oversee the conduct of the global Phase III studies. Ionis will manufacture eplontersen for the ongoing clinical trials and support regulatory approval. AstraZeneca will be responsible for commercial supply with transition timing to be agreed soon by both companies. We will work jointly with AstraZeneca to develop global eplontersen commercial strategy, and we will co-commercialize eplontersen in the United States. With that, I'd like to turn the call over to Onaiza to share some more details about Ionis' role in this collaboration and how today's agreement advances our agenda and our overall commercial strategy. And Beth will discuss the terms of the agreement in more detail. After Beth, I'll wrap up our prepared remarks before taking your questions. Now to Onaiza.

Thank you, Brett. It's an exciting day for Ionis. This agreement not only positions eplontersen to reach for ATTR patients, it also significantly advances our efforts as we prepare to launch multiple products in a short period of time beginning as early as 2023. Since joining the company last year, building a world-class commercial organization, enabling Ionis to capture the full value of our science and pipeline has been my key objective. In that time, we have worked expeditiously and taken numerous steps to put us right where we need to be at this point on our path. We are currently executing on a big and exciting agenda, including eplontersen, we have at least 3 drugs with as many as 5 indications advancing in the near term and all coming to market within a short time. Our agreement with AstraZeneca immediately increases our bandwidth and addresses our need to add scale and infrastructure to fully realize eplontersen's potential. It also enables us to continue building out the Ionis and its commercial infrastructure to launch olazarsen and donidalorsen, which we need to do in parallel. Now let me spend a few minutes outlining our role in collaboration with AstraZeneca. As Brett mentioned, Ionis will continue leading and conducting the ongoing global Phase III studies. Although ATTR cardiomyopathy is the largest opportunity for eplontersen with an estimated 300,000 to 500,000 patients worldwide, hereditary ATTR amyloidosis in patients with polyneuropathy is the immediate opportunity. We look forward to reporting data from NEURO-TTRansform capital study in this indication around the middle of next year. Assuming a positive study readout, we expect to file a new drug application for this first indication by the end of 2022. This is a sizable market opportunity with up to 40,000 addressable patients worldwide. And today, we believe only 10% of those patients are receiving treatment for their disease. We also remain on track for data from the Phase III CARDIO-TTRansform study in patients with TTR cardiomyopathy in 2024. It's important to point out that we see the design of these studies as key differentiators for eplontersen. In particular, CARDIO-TTRansform is the largest and most comprehensive Phase III study in patients with TTR cardiomyopathy conducted to date. We expect to generate a robust data package showing utility of eplontersen alone or in combination with TTR stabilizers, which should enable physicians to make the best and most informed choices in a broad range of ATTR patients. We will also collaborate with AstraZeneca on the development implementation of a number of key commercial activities supporting both indications in the U.S. AstraZeneca will use its established cardiovascular sales organization to deliver eplontersen rapidly and effectively around the world. Additionally, we will collaborate on developing the global brand strategy. This includes working jointly with AstraZeneca to develop the annual U.S. brand strategy, which will focus on resourcing and other major decisions, such as product positioning, air-value proposition and go-to-market messaging to ensure a strong launch and continued market penetration. We and AstraZeneca will jointly prepare the U.S. tactical plan to ensure we are using the expertise of both organizations in a productive manner. Although the respective roles and responsibilities will be finalized after this agreement closes, we expect to lead the implementation of the U.S. patient services support hub, including managing field nurse case managers. We will work alongside AstraZeneca to develop and implement the U.S. medical strategy. And we will share the responsibilities of KOL engagement, publications and other medical affairs activity. Importantly, we plan to leverage these capabilities to bolster our commercial organizational builds and at the scale and infrastructure we need to launch olezarsen and donidalorsen. As I stated before, we have a big agenda to expeditiously prepare markets and engage key stakeholders as our medicines get closer to approval. We plan to launch multiple products with tremendous opportunity in a short period of time. This agreement addresses our near-term objectives, enabling us to hit the ground running with eplontersen and to achieve success with our near-term product opportunities. And with that, I'll now turn it over to Beth.

Thank you, Onaiza. This agreement further strengthens our financial position and builds upon the progress we have made in the last year to focus our resources in support of our near-term commercial opportunities. Through our Akcea and Sobi transaction, we rightsized our commercial organization and redeployed resources to support our highest priority programs. Our agreement with AstraZeneca builds on that progress in several important ways. First, we are eligible to receive up to $3.6 billion in an upfront payment and potential milestones. The $3.6 billion consists of the following elements. Up to $300 million in near-term payments, including a $200 million upfront fee, plus development and approval milestone payments. We anticipate recognizing a large portion of the upfront fee this year, assuming HSR clearance. The $3.6 billion also includes $385 million in additional regulatory milestones and nearly $3 billion in sales-related milestone; second, AstraZeneca will pay 55% of the costs associated with the ongoing global Phase III development program, including the cost of product. AstraZeneca will also pay for a majority of commercial and medical affairs costs in the United States and all costs associated with bringing eplontersen to market outside the United States. Importantly, the cost-sharing provisions in this agreement provides us with substantial resources to scale our capabilities, not just to meet our obligations for the U.S. launch of eplontersen, but also for the launches of olezarsen and donidalorsen; and third, we are eligible to earn royalties like global net sales. For sales outside the United States, we are eligible to earn tiered royalties up to the high teens. And for sales in the United States, we are eligible to earn a mid-20% royalty. The higher U.S. royalty rate reflects our greater level of participation in the U.S. development and commercialization of eplontersen compared to markets outside the U.S. We believe that in addition to being the best strategy to maximize patient and shareholder value for eplontersen, this agreement also represents a key step in ball stream, our commercial organization as we prepare to launch multiple products in the near term. And with that, I'll turn the call back over to Brett for final remarks.

Thanks, Beth. Through our long-standing collaboration with AstraZeneca, they've developed a deep understanding and appreciation for innovative technology, extensive experience in RNA-targeted therapeutics and for our talented team. And we have developed a similar appreciation for their knowledge and experience in delivering blockbuster drugs to patients across multiple therapeutic areas, including cardiovascular disease. This collaboration with AstraZeneca further strengthens our financial position, gives us immediate scale to deliver eplontersen to more patients and frees up internal resources to simultaneously advance our late-stage programs and prepare for our multiple near-term product launches. For all the reasons you just heard, I'm confident that this is the right agreement with the right partner to bring eplontersen to market while advancing our vision for the future. And with that, we'll open it up for questions.

[Operator Instructions] And our first question comes from Gary Nachman with BMO Capital Markets.

Congrats on the collaboration. First, will you split up the responsibilities for polyneuropathy and cardiomyopathy any differently? Or are they both 50-50 in the U.S., just given AstraZeneca's strength on the cardio side? And do you have any sense of what your initial efforts in PN will look like? How many reps you'll need? And will those actually be your own reps? And then just remind us what the time line is for the product outside the U.S.? And then I have one follow-up.

Sure. I'll ask Onaiza to maybe comment on that.

Sure. Thanks, Gary, for the question. So we don't expect to do any split of indications in this deal. The way we've actually had the conversation with AstraZeneca is that we would participate in the global brand strategy and then focus in on the participation very firmly on the U.S. brand strategy, taking it all the way from the ATTR launch with polyneuropathy to cardiomyopathy. We are definitely excited about their large presence in heart failure and cardiovascular diseases. We think that will be a great [indiscernible] and complementary to our strength, which is deeper in any doses and ATTR, both with PN and mixed phenotypes. So we expect to kind of go on this journey together in the life cycle of the product. And as I said, the respective roles and responsibilities, although we've had some really good initial discussions, we expect to finalize that as the agreement close. We do know that we bring tremendous expertise in U.S. patient services. Our access hub with Akcea was really well rated. So we expect to actually lead that effort. And then we will work alongside AstraZeneca to develop all of the other executional elements over the course of the agreement. So pretty exciting.

Thanks, Onaiza. I'll just add to that, Gary. Current plan is because of our experience in the neurology space. The current plan is for us to file for polyneuropathy indication. And AstraZeneca will take over for the cardiomyopathy filing. And regarding timelines, I think you were referring to data readout, and that is midyear next year for polyneuropathy, and then we're on track for 2024 for cardiomyopathy readout.

Yes. No. And also, Brett, just the timelines outside the U.S.? With the filings, is it the same time? Or is that going to be a little bit later?

It will be a little bit later. It's possible. We'll also file in the EU next year for polyneuropathy. And what do you think about cardio? I think we're still in the same time frame.

Yes. I mean we're in the same timeframe. Gary, just keep it by like the filings may be in parallel, and we're thinking about it that way. But for Europe, you also have to wait for reimbursement as well. So that may be a little bit further behind the U.S.

Okay. And then just a couple of other follow-ups. Can we expect you to do something similar with losartan, just given the potential of going into a much bigger market there with the severe high triglycerides, maybe having a partner for that opportunity? And then with this deal with the additional funds and cost sharing, anything you would consider doing, you and AstraZeneca with cardiomyopathy study to accelerate that timeline. Do you have anything in your control to be able to bring that forward a little bit more?

Yes. Great question, Gary. So we are preparing our strategy for our near-term commercial launches, our near-term commercial participation, uniquely for each specific asset that is going forward. We believe this is the right deal, the right partnership to bring eplontersen to as many patients as possible as we outlined in our prepared remarks. AstraZeneca's right partner, this is a rapidly increasing competitive environment in TTR amyloidosis. And we think this is the right strategy for eplontersen. This does not mean that this is our strategy for olezarsen or donidalorsen. And in fact, we plan to bring olezarsen and donidalorsen to the U.S. market ourselves. And we will decide on ex-U.S. strategy as we go forward. There are lots of options for that, and we haven't settled on the ex-U.S. strategy at this time. Regarding acceleration of cardiomyopathy, yes, we haven't stated anything specifically on any strategies to accelerate the timelines for cardiomyopathy at this time.

The next question comes from Jessica Fye with JPMorgan.

I was curious if you could zoom out and tell us a little bit just about the history of how this transaction came about as an inbound interest from AZ. And also you just touched on this the prior question a little bit, but maybe even at a higher level, Brett, you've talked about keeping more of your assets wholly owned. So this seems to be in a little bit of contrast to that. So how does this transactions sort of fit with your overarching strategy for the business? And lastly, why now at this point in time for this partnership?

Sure. Great questions, Jess. Thanks. So we are preparing to bring eplontersen to the market ourselves. We weren't seeking necessarily a partner for this drug. But with our pipeline and especially our rich late-stage pipeline, we get a lot of inbounds companies coming in, inquiring about assets. Eplontersen was been -- has been an asset that has garnered great interest over the last couple of years. Some of those -- some of that interest wasn't attractive to us. Others were more attractive to us, especially with the commitments that the partner was bringing to the table and their experience and their knowledge of Ionis and our platform. AstraZeneca fits all those bills. We've been working with AstraZeneca in cardiovascular diseases for years now. We have several programs in development. They're very, very enthusiastic about our platform. And the more and more we talk together, the more and more we realized this was the right -- the best strategy for eplontersen in an increasingly competitive marketplace. Regarding strategy, this is entirely consistent with our commercialization strategy, bringing forward products of our own to the market in a manner to maximize the value to shareholders to patients. I can just repeat what I said already that eplontersen is a unique asset in that it is a large market in a highly competitive space in which we will benefit -- our commercial strategy will benefit greatly from having a partner with the power of AstraZeneca especially in the cardiovascular space. Each drug will be dealt with very -- in a very unique manner to maximize value to patients, to maximize value to shareholders. As I said earlier, olezarsen -- as we said in our prepared remarks, this deal not only helps with eplontersen, it frees resources and expands our ability to add resources to olezarsen and donidalorsen and drugs that are coming behind those 2 near-term opportunities that to maximize success on the commercial front. We're planning to bring those drugs to the U.S. market at least ourselves. So I really do believe it's highly consistent with our plan to keep more drugs and to commercialize products of our own. Why now? I mean, I'll let Onaiza to talk about that, but you need to prepare for launches years in advance and doing -- establishing a partner expanding our relationship with AstraZeneca and preparing jointly to co-commercialize these products in the United States and to build a global commercial strategy involving Ionis and AZ globally. This is the right time. We're just -- we're planning -- we're going to be -- we're planning to prepare for filing next year for neuropathy, and we're just a couple of years away from cardiomyopathy. Onaiza, would you agree with that on...

Yes. No, absolutely, Jess. I wanted to add maybe one more finer point to, Brett, right on point comment is that we've realized that we've done all of the planning for these 2 indication launches and realize that polyneuropathy has a really exciting opportunity right in front of us, and it leverages our deep experience in amyloidosis as well as centers of excellence. As you get into wild-type ATTR cardiomyopathy, we really will benefit from reaching many more patients and the community cardiologists with the presence of AstraZeneca. And we'll do that jointly as well. It has a couple of benefits. It helps us expand the reach and the potential for eplontersen, but also expand Ionis capabilities in cardiovascular as we prepare for olezarsen to do that on our own. So it's really a great benefit because we get to leverage the capabilities to bolster our commercial organizational build and at the scale and infrastructure in parallel for olezarsen and donidalorsen as well.

The next question comes from Gena Wang with Barclays.

This is Sheldon on for Gena. Maybe a couple of questions on the design of the cardio transform trial. So first, for the potential interim look at week 61, could you talk about the end point will be looking at the potential impact on the filing strategy? And also, a separate question on the potential stabilizer use. Do you have stratification on the stabilizer use and allow patients to start if they wasn't a stabilizer at baseline during the trial? And do you have an expected percentage of patients that will eventually be on stabilizer?

Sure. Thanks. So as Onaiza highlighted in her prepared remarks, we believe that the design of our cardiomyopathy Phase III trial, positions us -- will provide very significant advantages for eplontersen. It's the largest cardiomyopathy study for TTR targeting medicine of any and it provides real-world experience, if you will, in that patients are allowed to be on stabilizers or not or move on to stabilizer during the course of the study. We are stratified to look at patients on tafamidis versus naive patients in the study, and we believe we're very well powered for that. We are monitoring the usage of tafamidis throughout the study. We have not set caps and we have not set a specific percentage of -- for our target how much patients will be on the tafamidis versus not. But we're expecting a pretty well good balance between tafamidis usage and patients that are naive. Regarding interim analysis, we have baked into our study, the potential for an early look interim analysis, which would be outcome data, the cardiovascular events, but we have not committed to an early look at this time.

Your next question comes from Yaron Werber with Cowen.

I have a couple of questions. Maybe the first one, maybe, Brett, I mean, it sounds like in terms of differentiation and just given that you're probably about 1.5 years behind vutrisiran. And vutrisiran is sort of quarterly, you're dosing monthly. Give us a little bit of sense in terms of competitive dynamics, where is the differentiation going to come for you? Is it that data with tafamidis as to differentiate you in the market? And then secondly, we understand from the fast symposium over the weekend that it sounds like the IND has been allowed for Biogen and Ionis' Angelman program. Can you maybe give us a little bit of a sense when you're going to dose the first patient?

Sure. I'm happy to take the Angelman, but maybe Onaiza can take your question about differentiation. We're not that far behind in cardiomyopathy actually. We're about that behind in neuropathy. But in cardiomyopathy, we're within earshot of competition. But Onaiza, do you want to take that, and then I'll come back to Angelmans.

Yes. Yaron, nice to hear from you. So differentiation is always the key when you're preparing your plans. We believe our product profile is very differentiated on multiple dimensions. First of all, it is certainly on efficacy. And we expect on our primary endpoint as well as some of the secondaries to show some really robust cardiovascular risk reduction. As Brett pointed out and as I did in my prepared remarks, it is a study design that will allow us to generate I think the evidence that clinicians are really looking for, they're awaiting second-gen silencers, but they also want to know how to use this in the treatment paradigm for patients with cardiomyopathy. When to use it, use it alone, use it in combination with stabilizers. And with the largest cardiomyopathy trial, we have the ability to generate this robust data package and mine the data for them, which will be a really great advantage for us while we're in the marketplace. We also hear that patients are still progressing on the current treatment. So there is an unmet need. And our data will actually show that in combination that you can actually certainly slow down the progression of the disease. So those are some of the efficacy parameters. The other thing that really comes up for these patients and for physicians is our at-home administration. It's a big advantage. And we do think that, that will be a choice differentiator when you're choosing between silencers as well as the efficacy of the product as well. So hopefully, that gives you a good sense of how we're going to differentiate in the marketplace. We have a couple of other elements, but we'd like to kind of keep that on our own because it's a competitive market. But you'll see that along the journey as we prepare this.

Thanks, Onaiza. And I have to add to that. I think having AstraZeneca as our partner is also a key differentiator. The global power of -- in the cardiovascular space with AstraZeneca joined with Ionis is a big advantage. I absolutely believe and we believe, and I think that cannot be overlooked as a key differentiator going forward. Regarding Angelman, yes, we delivered on all of the data readouts and more that we said we were going to deliver on this year as well as new study starts. And in fact, we exceeded a lot of that. The one remaining is the start of the Angelman study. The IND is filed. We're ready to get -- we're activating sites, and we're still planning to dose first patient by the end of the year.

The next question comes from Paul Mattias with Stifel.

This is Alex on for Paul. I'm just curious if you could clarify a little bit more the terms of the agreement in the U.S. I think I heard that it's mid-20% royalties in the U.S. It's not a profit sharing. Just wanted to hear a little bit more there.

It's Beth. So just to reiterate on the terms. $3.6 billion of the value in an upfront and approval milestones plus sales milestones up to about $3 billion. So very attractive financial term. On the royalties, it is a royalty-bearing agreement. There's some important tax purposes for that. I don't want the royalty-bearing nature of the agreement to overshadow the fact that this is a really, really important co-commercialization and co-development transaction between the 2 companies for the United States. And I think that's why the 20 -- mid-20% royalties is really quite attractive. And then outside the United States, we have royalties up to the high teens. So really, overall, very attractive financial terms to reflect really a transformational transaction for Ionis at this point in our journey.

Yes. Yes. And I would just add to kind of what Beth said that the way that the structure is that we will be sharing costs in the U.S. for commercialization, including medical affairs as well. So those things will be kind of tallied up. So even though -- and we will be deciding on kind of the resource allocation for the brand together in the United States. It really is operating in that effect. But for maybe tax purposes, the better financial structure was formed.

And then just as a quick follow-up to this, so do you have any ability to opt in for a larger proportion of U.S. revenue?

We don't have rights for opting in it in that way.

And then finally, do you think you could -- any color you can give on the proportion of sales milestones related to U.S. versus ex-U.S?

No, we haven't given that level of detail. Just suffice it to say that the sales milestones are global for there on global sales, and it's nearly $3 billion. So it's not -- those milestones aren't based on sales in territories, they're on global sales.

The next question comes from Yale Jen with Laidlaw & Co.

My first question is that for the U.S. sales, which company will focus sales? Would that be AstraZeneca or will be Ionis?

Yale, AstraZeneca will be booking all sales globally.

Okay. And the second question is in terms of the TEGSEDI once launched in the U.S., what would be the -- would that be a transition for patient to that? And how should we see that?

Yes. That really -- as you know, Yale, Sobi is distributing TEGSEDI in the United States and in Europe and in certain other countries. And they don't have -- obviously, they don't have rights to eplontersen and AstraZeneca has the rights to TEGSEDI, but that will just be a dynamic market situation, whether patients decide to transition over, but we have no control -- direct control over that specifically because they are with 2 different partners.

Okay. And then my last question here is that in terms of the rectory milestone, which is quite significant, should we consider a majority -- overwhelming majority of them could be paid out at least in next year as well as by the time of approval or complete cardial studies?

So the approval milestones about $100 million of the $485 million are near term. You should think of them as near term and the others will be a bit further out. So think about that as you think about the timeline for the 2 indications and the various different geographies for each of those indications.

The next question comes from Mani Foroohar with SVB Leerink.

This is [indiscernible] on for Mani. Congrats on the deal. For the potential interim analysis for the cardiomyopathy study, what are some of the deciding factors or events that could trigger this analysis for your team?

Well, we haven't disclosed sort of the criteria that we're working against for -- that will lend us to pursue it, an early look at the data and interim look or not. But obviously, it will be event-driven. It will be enrollment-driven, and we're monitoring that as we go forward.

Okay. And for the -- again, for the cardiomyopathy study, is there a specific criteria for tafamidis use? Or is it entirely just up to the investigator? And how do you think it will translate to potential labeling of eplontersen?

Yes. So there is no criteria -- specific criteria. Patients are allowed to be on tafamidis based on the discretion of the patients and the physician. As I said earlier, we are monitoring usage very closely. And we can always make adjustments if we need to. Right now, we don't feel we need to because we're seeing a very nice balance as we hope to achieve with tafamidis usage versus naive. Maybe Onaiza could touch on -- is it too risky taking 2 risk at risk. But I'll talk a little bit about what our expectations on how the study could impact label.

Yes. labeling, obviously, is really important in considerations as we think about the study design. I think having the largest and the most comprehensive Phase III study actually really gives us confidence that our label will show the utility of eplontersen in subgroups, be it on patients who are naive to tafamidis or on top of tafamidis. And we, again, think that will be -- that's our goal in our address label. And as Brett said, we are doing very nicely in terms of how the study is progressing in the proportion of gathering data across those 2 subgroups as well. We'll also have some other cuts of the data that I think will be very informative to differentiate and for clinicians as well, such as patient severity and other points on the mechanism of the disease as well that are going alongside the Phase III. So in combination in totality, we believe to have a very robust data package to enable differentiation for eplontersen in the market.

And the next question comes from Kevin DeGeeter with Oppenheimer.

A number of them been answered already, maybe just 2 more. Can you just comment a little bit more on terms of timing of the transaction, specifically the thought process about signed this transaction prior to the polyneuropathy Phase III readout versus potentially waiting after? And then on the deal structure side, I think we appreciate that it's a royalty structure and that there are commitments for Ionis to make certain investments. Should we think about there being contractual minimum spend levels on the Ionis side to support commercialization. I'm just trying to better understand sort of the match of the inflow of economics versus the ongoing commitment.

Sure, Kevin. I'll take the first one and maybe Beth can jump in on the spend question. So again, as I said earlier, we are participating in the global -- very significantly participating in the global strategy, commercial strategy for eplontersen with AstraZeneca. And to do that most effectively, we need to do that well in advance of filing IND, NDAs and launching the drug. So earlier is better. We think the terms of this deal are very compelling, very, very strong. And again, we think we have the right partner. And we want to take advantage of having the right partner now to prepare for well in advance for the commercial launch. And in particular, for the cardiomyopathy commercial launch, AstraZeneca brings, as we've said several times, brings tremendous strength and experience in the cardiovascular space, which to win on the market in a competitive landscape, you need to start preparing years in advance. We want to do that together, going well in advance to maximize the potential for success on the market. Regarding the minimum spending, you've got..

Can I add to that a little bit, yes. So I think it's really important for us to kind of listen to the market here as well. So in addition to being very timely, and the preparation for launch is coming well in advance jointly with the partner. Even though the indication in the filing strategy is around 2 indications, the market and the clinicians are viewing this as a very systemic disease, and there isn't that much of a bright line that's happening between neuropathy and cardiomyopathy. So it's really in our best interest, as you ask why not after polyneuropathy to really start early and start shaping kind of the market towards treating this as a systemic disease across hATTR as well as wild type, progressing all the way from polyneuropathy or cardiomyopathy. And it is multidimensional. It's not a single type of treater that does it. So really for us to go out there and go to the doctor or it's a multidisciplinary to get -- drive these together with AstraZeneca early versus kind of waiting until a later partnership is really beneficial for overall product reach and product penetration as well. Now I'll turn it over to Beth for the investment question.

Thank you. So on the cost sharing, think about it this way that Ionis is going to continue to lead and conduct the very broad Phase III program that's underway right now with the polyneuropathy, NEURO-TTRansform and the cardiomyopathy CARDIO-TTRansform studies, the open-label extension studies and all of the CMC efforts that are underway to prepare for registration. AstraZeneca and Ionis will share in the cost of that broad development program with AstraZeneca, assuming 55% of those costs and Ionis the difference. And then on a commercial and medical affairs basis, the 2 companies together, as Onaiza has described, will determine really what the global brand strategy is. And based on that, we'll determine appropriate levels of resourcing and investment and AstraZeneca, will assume the majority of the costs associated with that resourcing and investment. So hopefully, that helps you understand a bit how to think about the cost sharing.

The next question comes from Joseph Stringer with Needham & Co.

Just a few quick ones from us. First one is you talked about it earlier on some of the synergies with the AZ beyond TTR, but maybe just outline maybe a little bit more detail on that beyond TTR. And then lastly, is there any additional color you can provide on sort of the milestone payments and some of the royalties? Are those sort of more back-end weighted or some -- any additional color on that?

Sure, Joey. Thanks. And Beth can handle the whatever additional color we can provide on the economics. Your question on TTR, I think, was -- I didn't exactly get it. I think it was our relationship with AstraZeneca beyond TTR. Assuming that's the question, it's a very productive strategic partnership in cardiometabolic with AstraZeneca, not only is now eplontersen, part of our strong relationship with AstraZeneca, it's also strategic for AstraZeneca. AstraZeneca is building a world class heart failure organization, their ambition, their goal is to be the world leader in heart failure. Eplontersen is a big addition to that strategy for AstraZeneca, and that will only benefit Ionis and all shareholders and stakeholders and patients. I want to remind you that we also have several other drugs in development in the cardio space with AZ, our PCSK9 program is shaping up to be a best-in-class PCSK9 inhibitor. And AstraZeneca plans to share exciting Phase IIb data at a medical meeting next year on that with next steps for that program. We also have a couple of drugs in development with AZ in the NASH space and renal failure space. And we expect more will be coming. So it's a great, great productive partnership. They know us very well. We know them very well. And that's why one of the reasons why we did this transaction. Beth, you want?

Sure. So on the milestones and royalties. So there's $485 million worth of primarily approval-based milestones. And and the $100 million of those are near term. So when you think about -- when I think about near term, I'm thinking about the fact that we've got the polyneuropathy indication as our first indication and that we're likely to file in the United States in -- at the end of 2022, assuming a positive Phase III study. And then the other sort of $385 million, if you will, are going to be a bit further out. Again, because they're approval milestones, you need to think about them with regard to the indication, polyneuropathy and cardiomyopathy as well as geographies, typical regulatory milestones tend to follow your major geographies. And so just to give you some sense, hopefully, that helps. On the royalties, the U.S. royalties will start on first commercial sale, similarly with the ex-U.S. royalties and then the nearly $3 billion of sales milestones are based off of global sales. And as those global sales increase, we would anticipate hitting the sales milestone triggers. And so I think it's really actually -- from my perspective, I think it's really attractive that those sales milestones are based off of global sales. So hopefully, that gives you a bit more color.

And thanks, Beth. Thanks, Joey. I think we have time for one more call. No. We have the next call -- the next question I mean.

The next question comes from Myles Minter with William Blair & Co.

Just a question on revenue guidance. I know you say above $600 million for the year. Is upfront payment on top of that? Or were you making any adjustments to the revenue guidance? That's the first one. And the second one is, is there any of the development milestones for today, would they be linked to the potential interim analysis out of the CARDIO-TTRansform study or there's more milestones associated with that?

All right. So on revenue guidance, so we are -- I'm not going to necessarily change our guidance, but I can tell you that we are on track to exceed our guidance at this point on this transaction is obviously a significant revenue-generating event of the company this year. I think one of the things to remember is we're still working through the accounting treatment with our auditors. So it's hard for me to say exactly how much of the upfront payment, assuming that we get HSR this year would be recognized as revenue this year, but I can -- I think I'm fairly confident in saying that it's the majority of the upfront payment. So that's sort of how to think about revenue guidance. On the development milestone, we have milestones. We haven't given any details on that. So I really can't give you more suppose by other than to say it's their near-term event.

Thanks, Myles. I didn't mean to cut you off there. I think now is our last question. And if we're running on time.

Our final question comes from Luca Issi with RBC.

Great. Just a few here. Maybe 1 on strategy, 2 on this deal and 3 on vupanorsen, if I can ask. So on strategy, I mean, just circling back on prior thoughts, Brett, would you potentially be interested in a similar transaction for HAE, where you co-commercialize the product in the U.S. and you partner the product ex-U.S.? Or is really the goal to commercialize that product globally by yourself? Maybe the second one on this deal for AstraZeneca. It looks like you'll continue to supply the material for the Phase III, but manufacturing will ultimately transition to AstraZeneca. So wondering if you can expand on the mechanics of that transition and whether there is any risk that the FDA will ask for bridging study there? And then maybe last one on vupanorsen. We obviously saw the press release on Wednesday or before Thanksgiving suggesting some ALT elevations and some increase in hepatic fat fraction. So I wonder if you can comment on whether you think that's a target-related issue or more related to the platform?

Thanks, Luca. Let me get vupanorsen out of the way first. So there's really nothing new to report since we last reported the data there. As a reminder, we hit the primary endpoint very effectively at all doses and Pfizer is deciding on next steps for that. And we'll touch on that later this week on -- in our Investor Day presentation on Thursday. Regarding commercial strategy for HAE and manufacturing transition, we're very excited about donidalorsen. And as I said earlier, we will pursue a commercial strategy that is unique to each individual drug that we choose to bring to market ourselves, to maximize the value to shareholders to patients. And each drug is going to be different and because they're unique, and we do not plan on doing a co-commercialization in the U.S. partnership for donidalorsen or for olezarsen at this time in the U.S. and outside the U.S., we'll decide on what's the best strategy for commercializing to maximize success globally. Onaiza, you want to add anything about that?

Yes -- no, I mean, I think you're spot on. I think the way to think about it, Luca, is that for donidalorsen, it's a very targeted market. And honestly, if you did a coco, we'd be -- I don't think that you'd see synergies in valley from partner, it might actually be detracting. So it really just depends on the medicine as just Brett said. In eplontersen, this is very complementary because we get the broad reach to the cardiologists and the synergies with AstraZeneca, but for donidalorsen, that would be a very focused promotional platform resource for us. So we can go it alone. And then the last thing I want to just maybe make sure everybody gets on this is that our expertise and experience as we do this together with AZ in cardiovascular, it's going to increase and will prepare us for olezarsen and the ability to go it alone in the U.S.

And I'll just close -- thanks, Onaiza. I'll just close Luca by saying we've been working with AstraZeneca on manufacturing for many years. We are very joined at the hip there. We don't see any risk in a transition for them to take on manufacturing for commercialization as we provide drug for the ongoing clinical trials. We see no risk there in any way. We've been very experienced with this as is AstraZeneca. Thank you, and thanks, everybody, for joining us on today's call. We look forward to discussing eplontersen more, along with our plans to launch additional products from our rapidly growing rich pipeline at this Thursday's Investor Day, December 9, at 8 a.m. Pacific. I hope you'll be able to join us for that meeting and then, bye for now.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.