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

I'm Ellie Merle. Thank you for joining the UBS Virtual CNS Day. Very excited to have Ionis Pharmaceuticals here with us today for a fireside chat. Joining us from Ionis is Holly Kordasiewicz, sorry, if I [ butchered ] your name, SVP of Neurology Research; and Wade Walke, SVP, Investor Relations. I know we just have 25 minutes, so I'll jump right in.

Maybe just high level, can you provide kind of an overview of some of the programs in the neuro space that you have and the time lines and then we can jump into specific programs.

Yes. So in our neurology program, we have a number of exciting things going on right now. We have, first of all, our Alexander's program is reading out later this year, and this is a pivotal program. We also have our MAPT program, which is being out next year. It's a Phase II study there. And then, of course, we have our Angelman program. And there, we're getting our Phase III study up and running in the first half of this year. So those are the main things that we're focused on in neuro right now.

All right. Great. Maybe starting with Alexander's, with the data expected in the second half, can you talk a bit about the biology here and how that translates into the data we should be looking to see?

Yes, happy to. So Alexander's disease is caused by mutations in GFAP. These are gain-of-function mutations, which lead to accumulation of GFAP and astrocytes, and the formation of Rosenthal fibers. Once you have that, then that links the damage of the myelin, the sheets covering neurons, and then you have a hypomyelination as a loss of myelin with a leukodystrophy. And since it's caused by that central GFAP mutation, our target is GFAP. We have beautiful preclinical data because you can make mice and rats that have Alexander's disease by introducing GFAP. You can lower that, you can reverse that hypomyelination, you can have a benefit a meaningful benefit on the function of the animals. So for our first-in-human study and our pivotal study, we have a really unique design and that this is an ultrarare disease and you have one study. So it's both first in human and it's pivotal, and that's what's reading out at the end of this year. And so there, we have a number of different end points that we're looking at. This is a complex disease with many different symptoms. Our primary is a 10-meter walk test, but we also have a number of secondaries looking at that constellation of symptoms of the disease. And what we're looking at to translate is evidence that we're having an effect on the overall underlying disease. So looking at trends across all those different measures that they're beneficial. That's because we're going after that central target, and we want that evidence that we're affecting the underlying disease.

So I guess how should we think about -- I mean, because we haven't seen clinical data yet or at least we have it, maybe you have.

We're still glad to do.

Okay. Like how do we think about what good data looks like here?

Yes, that's a great question. So what we're looking for, as I mentioned, is those trends across the board. So good data will be tried in different domains, showing that we're having that effect on the underlying disease. So we, of course, have our primary endpoint, but that's not our only focus, also those secondaries as well. And we've had discussions with regulators that there'll be a lot of regulatory flexibility here, given the rareness of the disease in this type of design that we have for our pivotal study.

I guess and then given that this is an ultra-rare disease, maybe if you could speak a little bit to sort of the market sizing here and how much market development do you expect it will take in the U.S. for Alexander's?

Yes. So it's about 1 in a million. So we think about 300 to 700 patients, and it is alternators going to be modern market development. The big thing we're focusing on there is faster diagnosis and patient identification. So really looking at education, we're supporting initiatives to try to be able to identify these patients earlier and diagnose them sooner, so they could get access to treatment, assuming everything works in our pivotal study. What that looks like in terms of development is we're CMEs for neurologists, I'm reading Alexander's disease signs and symptoms and MRIs for diagnosis. And we're trying to do this in a very efficient way, collaborating with patient advocacy organizations using Congress presences, using omnichannel to get access to those individuals who might see these patients and get that diagnosis.

What proportion of this like 300 to 700 patients in the U.S. are currently diagnosed if you have a sense?

So have a good sense. So we don't have a good sense of that. But what we do have is thankfully there's an ICD-10 code that actually came out for this about 18 months ago. And so we're getting more and more information on diagnosis and use of that and identification of patients through that. So that's been really nice for this ultra-rare disease to have that.

And then I guess, just how like -- I know probably some of the work is still in progress. But like in terms of like the payments that are diagnosed, is the treatment more centralized, let's say, academic centers or sort of centers or excellence? Or is it more spread out, maybe going into kind of the community setting?

Yes, it's really get centers for excellence. So the experienced shooters for Alexander are at those centers for excellence because they can provide that multidisciplinary, complex symptomatic care that's happening right now for the patient. And we actually expect a lot of our treatment decisions and administer to happen at those centers for excellence. So that's really where we're going to be -- where we are focused on and we're going to be focused on for the launch. Again, assuming everything goes well in the pivotal.

Great. Well, we're looking forward to seeing that data later this year. Maybe turning to Angelman, maybe can you give us an overview of the biology of the disease, the severity and the unmet need and just how those patients are currently managed?

Yes. So Angelman is called a loss of function by UBE3A. This is an E3 ubiquitin ligase that's really involved in [ synapse ] remodeling. So this is a neuro-developmental disease. And again, our target is we're upregulating that lost gene of UBE3A. These patients, they have normal development, and then they stop hitting milestones. And that happens around 6 to 12 months of age is when they start being visible that they aren't meeting milestones. And then the patients continue to develop, and they peak at about the neurotypical 2 to a 4-year old. But then they have a normal life span. So you can imagine this is a really severe disease where patients are developed cognitively and with their speech and they're motor to about a 2 to 4 year old and then they live a normal life. And in terms of how it's managed, this is there is some treatment options in terms of treating the epilepsy, antiepileptics and seizures and some sleep medicines that are going to the individuals with Angelman but most of it is managed care and most of it is physical therapy, behavioral therapy, communication, speech therapy, things like that. And so there really aren't many options for these patients and definitely know disease-modifying options, which is what we're trying to do with ION582.

And can you walk us through what was seen in the Phase II data last year. And I guess, the natural history work that's been done to sort of put that data in context?

Yes. So we're really happy. So HALOS was our trial that was our first in human study. This was a MAD design so we had 3 different dose levels. And we looked at those patients over time. We looked at a number of different domains for this disease. We looked at cognition, motor, communication. We use multiple different cohorts so we had the Bayley, we had the Vineland, we had the CGI, and we've shared all this data. And what we found is that there was benefit across the domains. So we had benefit across the domains in a dose-dependent manner, and it was a benefit that exceeded that of natural history. So one of the really great things about Angelman is even though it's rare the community has been really fantastic. And way back in 2006, they started natural history study. So we have lots of longitudinal data in natural history in this disease. So we were able to pull out 150 patients from that natural history where we had nice longitudinal data that we could match to our cohort that we had in HALOS and demonstrate that the HALOS effects that we saw in that trial be the natural history.

All right. Great. And I guess with the Phase III beginning soon, I guess, can you walk us through the decision to choose daily for with the expressive communication of the primary endpoint. I guess, was this like sort of the FDA steering you towards this domain versus the others? Or was there some flexibility?

This was our choice. So this is was our choice that we proposed to the FDA and the FDA readily agreed. The rationale that we provided for them is there's a nice stable baseline. So these patients, they have no speech or very limited speech so you're at the very bottom of that scale. So there's lots of room for improvement, and it's very stable. So over time, it doesn't change, which is what you want in your natural history for an endpoint. It's also most bothersome symptom for caregivers. They're very clear that if they're individuals with Angelman can communicate, that would be a meaningful difference for them, which, of course, is important to us and regulators. And then it had the biggest magnitude of effect in our HALOS trial. So having the biggest magnitude of effect, and that's stable, low baseline, it gives us that nice big delta that we will be looking for in our placebo-controlled trial, so the highest probability of success for that. So no pushback from FDA readily accepted, and we're happy that we're moving forward.

And maybe what are some of the other end points of focus? Or maybe just how the sort of KOLs in the space tend to talk about the various endpoints and the relative importance?

Yes. So the -- what we'll be looking at is very similar to what we had in the HALOS study, of course, we'll be using the Vineland, the CGI, and the ORCA as well. So the different [ KOLs ] that are out there, the different assays that are available. In terms of the KOLs, as you can imagine, they have lots of opinions, and there's lots of different opinions. There's no one focus that they have that we should be zeroing in on, there's pros and cons to all of them. Since we've decided on expressive communication, we haven't heard anything they give about that only support from that from the KOLs. Their biggest thing is just to make sure you're looking at the complexity of the disease in our secondary so that we can see which and hopefully all of the domains are having benefits like we were able to show during HALOS to making sure we're capturing that complexity.

Absolutely. And in the context of maybe the competitive landscape with Ultragenyx, maybe what are some of kind of like what you view as differentiating features of your program?

Yes. So I love our drug. It's a well-tolerated drug. It's safe, it's one that is using our proven technology that we are very familiar with, and it's performing exactly how we would expect based on what we knew previously. And so because of that, I'm happy with what we're moving forward with. I also like our design as well. So our design as we have for our Phase III study, we're looking at a broad patient population because we're not limited because we don't have any of the safety effects that they've got, we can do ambulatory and nonambulatory patients because our HALOS trial included both mutation and deletion carriers, we have confidence including both of those in our pivotal cohort as well as looking in the overall [ reveal ] study, that's the name of our Phase III trial, that adults as well as children. And so we'll have that broad patient population in our trial to hopefully give us that broad label that we're looking for to be able to help all the patients of Angelman.

And kind of building off of Alexander's disease, like how should we think kind of about both the opportunity in terms of like the number of patients with Angelman that are currently diagnosed. And sort of as an organization, how you would approach the scale-up, especially from Alexander to Angelman from a commercial perspective?

Yes. So it's a great question. So there's, of course, many more patients with Angelman than there are with Alexander's disease, but with Alexander's disease being first, we can use that to start building the foundation in pediatric neurology so that when we then move into Angelman, [ which is ] larger, we can grow quickly. One of the overall strategies that we have for our commercial organization is to look for significant synergies across the organization and particularly within rare neurology and cardiology. So we're going to leverage all the work we do for Zilganersen or that Angelman syndrome. And a great example of this is the leadership that we've already built in our current commercial organization has extensive experience building those rare markets. And even with our trend Tryngolza, which is also a rare market, which they're building, they'll be able to apply that experiment to both Alexander's disease and then Angelman.

How should we think about the diagnosis rate of Angelman today? I mean it's like the symptoms are perhaps pretty clear or at least like from sort of a visit to the doctors. But how should we think about kind of the size of the prevalence pool and the proportion that are diagnosed currently?

Yes. So it's 1 in 12,000 to 1 in 20,000 we think. So potentially -- I mean a million people worldwide which is huge. And because of the awareness of Angelman and just the sheer size of it comparing it to Alexander disease, it's much quicker diagnosis. And then the genetic confirmation comes really quickly after that. So there's much more awareness, but there's still work to be done in terms of making sure that all the patients who could potentially benefit are aware of it. There's also really fantastic patient entities out there that we're collaborating with, who are bringing this awareness and spreading that information. So I think it's in a it's in a good place in terms of people understanding the disease and being aware of it. And then again, with anything that we're doing, once there's a treatment, we expect there to be more awareness and more uptake. and we saw that with SPINRAZA. And one final thing that we haven't touched on yet is for both these indications for Alexander's disease as well as for Angelman its ultimate goal is to get this on newborn screening. And if you can get this on newborn screening, then you can get these children treatment very early. And when we talk to parents, this is exactly what they want when there's diagnosis, they want to be on treatment. So both for Alexander's program, we have a 0 to 2 open-label cohort that we're treating. And then for our Angelman program, we're opening up a 0 to 2 open-label program. And because our drug has been shown to be safe, we're going to be able to do that. So we can have data on those very young individuals so that as soon as diagnosis is need, then they can get on therapy. So we think all that will raise awareness and open up the patient community and the patient identification.

How should we think about the time lines here, just like how you're thinking about how long it will take to enroll and like basically like where we sit, we get next, get an update, whether it's a longer-term data from some of the Phase II study or, say, the Phase III data?

So we will start the trial in the first half of this year. We are on track to do that. We have everything the protocol set, the regulatory alignment is set, and we're just getting the sites up and going, so that's going to happen. And then we're planning to complete next year and then it's a 12-month endpoint. So for the primary endpoint for the REVEAL study. So you can kind of do the math from there and figure out where we should land.

All right. So 2027-ish, okay. Well, we're looking forward to seeing that data. MAPT, yes, some interesting yet like early data from the program so far and I get it data coming next year. I guess maybe can you talk about what's seen from your initial first-in-human study and sort of maybe how using an ASO might be different from using an antibody in terms of addressing the tau burden?

Yes. So I love this program. I mean I love most of our programs. With this one, I'm particularly fond of and that's because in Alzheimer's disease there 2 pathologies, of course, there's [ beta ] plaques and then there's the tau tangles. The tau tangles are intracellular. And what we're doing is we're stopping the production of tau. So before any pathology forms you stop tau from being made and antibody approaches after tau are only going for extracellular tau. So you have to catch it when it's moving from neuron to neuron. And once it gets in that neuron and the antibody is not going to do anything. So here, we stop the production within neuron. And we've shown in preclinical models, if you stop the production within a neuron, you actually reverse existing tau. The exciting data from our first-in-human study is there's tau PET. So we can look at pathology longitudinally in man. And we were able to show that with treatment, we did the oligonucleotide that stopped tau. We looked at 100 weeks, we looked at baseline, and we looked at that 100-week time point at tau pathology, and we actually reversed tau pathology. So that's really important. We didn't just stop production we reversed existing pathology. So by stopping tau production, the body, the brain, the aged Alzheimer's grade is actually able to clear that existing tau pathology and then prevent more pathology from happening. So that was really exciting. And that is since it's so central to disease, could potentially be a really important treatment for Alzheimer's disease. And I think that's where a lot of the excitement and the buzz is coming from for this one.

Yes. No, it's exciting data. Maybe can you tell us a little bit more about the design of the Phase II? And I guess, what data we should be looking for next year?

Yes, of course. So the Phase II study is looking at different dosing regimens. So we are doing both a quarterly as well as a 6-month dosing regimen. So from our first-in-human study, we also saw that the oligonucleotide lasted a really long time in man. Could spread out the dosing interval and so that means treatment, if that works, just twice a year to potentially be therapeutically beneficial in Alzheimer's disease. We're doing a -- we are looking at an endpoint, which is a clinical endpoint. We're looking at the CDR sum of boxes, and that's had 76 weeks of placebo-controlled treatment. It's just over a 300-patient trial. I think we ended up in the 370 range, about there when we were finally enrolled. And as we've been mentioning that reads out next year. So it's fully enrolled, and we're just waiting for the data now.

Exciting. So what's clinically meaningful in terms of like the difference on CDR sum of boxes? Or are we still looking at that like 30% or so range? Or yes, how should we be thinking about that?

Yes. So you're referencing in what's happened with A-beta. So I think on par with A-beta will make a lot of sense. So because of our mechanism of action, the A-beta antibodies, they do have a small effect but it is a meaningful effect. And I think that's been clear in what we've seen being approved in that space. And but it comes along with [ ARIA ]. And I think that's where a lot of the hesitation around the antibodies are that safety because of our mechanism of action of lowering tau, we shouldn't have that safety effect. So the evidence of ARIA and no prediction of that from our mechanism of action. The other exciting thing for tau is that the tau pathology correlates best with cognitive decline. So there is the benefit of more. And so it would be great if we saw more, but I wouldn't set that expectation because if we're on par with the A-beta antibodies, because these are 2 different mechanisms, you could envision using them together and using them that could then be additive or even synergistic based on the mechanism. So then that would be the next question.

So what would the -- I guess, next be, would it be to run a Phase III monotherapy but then also study a combination. I guess -- have you looked at -- like your plans with sort of combination Phase II [indiscernible].

All that's in discussion right now, but absolutely a Phase III. And I think it's going to depend on the data, but Phase III monotherapy and what else we do in parallel will be dependent on the data and state of all the other therapies on the market and they're doing and how they can be used. And that's, of course, this is partnered with Biogen. They will fully license this program, so they'll be making all the final decisions on.

I guess given the like potential like better safety, I guess what really is the bar from an efficacy perspective? Like I guess that would be the lowest improvement we could see on, say, CDR sum of boxes and still want to move forward and into 3 given the biology safety?

So Biogen hasn't given out those numbers, but I'd be happy with anything on par with the A-beta antibodies.

Great. And like how would this work in practice? Is it sort of almost like oncology, where patients would get multiple agents?

Yes. So that's what I think that's where we're going. So we could be blown away by talent. It could be just amazing and that it could be all you need. And it could be the hypothesis that tau is downstream of A-beta is, right? And this is going to capture everything. But I think Alzheimer's is a multi-factorial disease, there's multiple things going on. So to fully treat the disease and all the patients that have it with those different underlying pathologies, we're going to need multiple shots on [ goal ] and potentially multiple therapies in individual patients. But that's just my personal view of the science and what's going on.

Turning to maybe the commercial side in polyneuropathy sort of what's the latest you're seeing in terms of the uptake of WAINUA and in particular, if there are certain segments where you're seeing more update versus less and how that's going?

Yes. I'll handle that one. So we're really pleased with the performance of WAINUA in 2024. We saw really good growth. And if you look at the last quarter growth, so Q3 to Q4, we saw $42 million increase in sales, and that's 84% growth quarter-over-quarter with $19 million an increase over the previous quarter. And it's interesting because if you look at the total combined TTR sales with our competitor drugs and our drug, I think it was like $39 million in increase and ours was more than half of it. So pretty impressive performance for 3 quarters and the way into the launch for this drug. We estimate that we're capturing about 40% or so of patients new to treatment in the TTR space for polyneuropathy. And so that's for us, we see that as a good sign, and we continue to see that kind of growth going forward into 2025. What we're hearing is that we're getting some switches. We're getting some combo treatment, but our focus from the beginning has been on patients who are new to treatment because about 80% of the patients out there are not diagnosed to that treatment, right? So we've got a great partner with AstraZeneca, who is able to have the commercial resources to get out into the communities, in the community centers and trying to identify these patients and get them on treatment. So the majority of our patients coming on treatment are patients new to treatment. Not saying that we're still seeing good uptake in center of excellence as well. Obviously, that's where you also find a lot of these patients. We're hearing that patients really appreciate the profile of WAINUA whether they're new or whether they're switching. They like the convenience of being able to administer the drug themselves anytime they want at home, the auto-injector is very convenient for them to use that they like the profile of the drug as far as the quality of life improvements that they're seeing in the safety and efficacy is on par with what they're expecting. So all of those things combined, I see, I think, are good signs for the continued growth that we knew this year and next.

You guys have had some interesting commentary on that you're seeing combination use commercially. Any color that you can sort of give there like a proportion or mix that you're seeing with combination use?

I wish I could, but we can't give those kind of details out right now. I don't think AZ would be happy with me if we did. But it is encouraging to know that this is a deadly disease. And just like the cancer, if there are mechanism -- 2 different drugs with 2 different mechanisms attacking a disease like this. there is desire to use those drugs to try and get the maximum benefit for patients. So you've got patients who are diagnosed with cardiomyopathy, tafamidis for example, patients who are diagnosed with polyneuropathy, getting [indiscernible] and so you've got 2 drugs, 2 different mechanisms of action to treat these patients. It's certainly something that I think physicians and patients like to be able to do when possible especially if patients are seeing 2 different symptoms or they're progressing in their symptoms.

Absolutely. And last question, just SHTG, a lot of investor focus on this readout later this year. We know that you can learn triglycerides. I guess, how do we think about what's clinically meaningful when it comes to acute pancreatis?

Sure. So I mean the treatments that are out there right now, especially in patients with very high triglycerides don't really have an impact in lowering triglycerides right? So you may get patients who get 10% to 20% reduction in triglycerides. And if you're starting out at 600 or 800 or 900, a 10% or 20% decrease in triglycerides are going to move the needle launch for you, right? And so given the fact that we've seen anywhere from 50% to 80% reduction in triglycerides depending on the patient population and the study that we're looking at I'd say we're pretty encouraged with potential of olezarsen to be able to lower triglycerides in patients with severely elevated triglycerides. So we've certainly seen it in FCS patients. We'll see it later this year with our SHTG Phase III studies. And so I think seeing a substantial decrease in triglycerides is the bar for our Phase III studies. Now beyond that, we're also looking at the major problem with having very high triglycerides is that you have risk for acute pancreatitis. And so one of our key secondary endpoints is looking at what kind of effect do we have on acute pancreatitis. And we've engineered the Phase III studies, there's 2. There's a pivotal and a confirmatory pivotal that are really out at about the same time and we're going to be able to do a meta-analysis combine both of those studies to be able to look at the effect of the drug on acute pancreatitis. So that's one of the key measures as well we'll be looking at.

Interesting. Well, great. Holly, Wade, thank you so much for making the time and sharing all the insights today, and we look forward to all the data readouts.

Thanks. We're excited.

Thanks. Bye.