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

All right. Great. Thanks, everybody. Luca Issi, senior biotech analyst here at RBC Capital Markets. And today is our great privilege to have Ionis as part of our 2025 Global Healthcare Conference. Representing the company, we have Brett Monia, Chief Executive Officer. Brett, thanks so much for joining us. How are you doing today?

I'm doing great, Luca. It's a pleasure to be here. Thank you for the invitation.

Absolutely, absolutely. Look, we have a long list of questions here. But maybe before we go to the individual programs, Brett, it would be great if you can give us some opening remarks. Maybe just talk about like some of the progress that the organization has made over the last few months and maybe, most importantly, what's ahead here for Ionis.

Yes. Happy to, Luca. Thank you. We're really, really pleased. I couldn't be more pleased with the remarkable progress we've been making at Ionis over the last few months, really over the last year or two. We've enjoyed several very important drug approvals during that period of time and subsequent launches, including our first independent commercial launch, TRYNGOLZA for FCS. The pipeline has just continued to deliver, mid-stage as well as late-stage pipeline, several very important Phase III readouts -- positive readouts, including just this week the ESSENCE Phase III study that we announced on Monday was very strong. In addition to these near-term launches and the pipeline progress, we also have done a great job with our partners. Our partners are on track for several important Phase III readouts over the next few months, over the next year or so with subsequent launches as well, in addition to our first independent launch, TRYNGOLZA, which really represents a really strategic achievement for the company. It represents our evolution to become a fully integrated commercial stage biotech company. TRYNGOLZA indicated for familial chylomicronemia syndrome, the first and only FDA-approved medicine for the severe devastating disease. Right behind TRYNGOLZA is donidalorsen, a prophylactic treatment for hereditary angioedema. We're expecting an approval in the second half of this year. And that represents, as I mentioned, our second independent commercial launch. Our wholly owned pipeline and anticipated launches are projected to be -- offer a multibillion-dollar revenue potential from our wholly owned pipeline. And then I already touched on our partner pipeline with 4 anticipated Phase III readouts and commercial launches over the next year or so, which really is -- and combined with our wholly owned pipeline, sets us up for substantial and sustained revenue growth and our goal to achieve positive cash flow in the near term. So the pipeline is delivering. The launches are delivering. And we're really excited about the progress we're making.

Sure, sure. No, that's actually super helpful. Maybe on TRYNGOLZA, let's talk about the launch a little bit. Obviously, when we look at Q1, $6 million for the quarter. I think a good mix of new to brand versus patients coming from the EAP. What can you tell us about April and May? How are things going? Do you see an inflection there and acceleration in scripts? Like any context on what you have seen since the quarter?

Yes. As I mentioned, TRYNGOLZA is our first -- represents our first independent commercial launch for Ionis for familial chylomicronemia syndrome, FCS. We're very encouraged by the Q1 results for TRYNGOLZA. We're in excess of $6 million in the first quarter in net revenue, which really exceeded expectations, all expectations out there today or at the time. We're really pleased with the mix of prescribers. Cardiologists, about half of prescribers are cardiologists. We also have a good representation of endocrinologists. And what's really important is that we're seeing scripts being written not only for genetically confirmed FCS but a substantial number of scripts being written for clinically determined FCS. Access has gone very strong, has been very strong, and things are looking very encouraging going forward, too. Over the last couple of months, we're encouraged by what we're seeing. It is early days in the launch. The success we've had so far is really a product of really hard work and execution. We did a lot of work prior to the approval of TRYNGOLZA in December. We did -- we essentially converted all of our patients in our U.S. open-label extension and expanded access program to commercial product now. There's also -- there were no treatments available for FCS in the U.S. So there were a lot of patients already identified. We were able to do a good job of getting those patients on to TRYNGOLZA. And we've also done a good job of pre-identifying potential patients that had FCS. And we've been doing a pretty good job of converting those newly identified patients with TRYNGOLZA as well. That's where the work is going to have to be going forward. Most of these patients, the vast majority of these patients are not identified to date. So we need to continue to identify these patients to continue the momentum we've built in the first quarter. But things are going well. We're very encouraged.

Got it. That's very helpful. Maybe let's talk about competition for a minute for TRYNGOLZA. Obviously Arrowhead has their PDUFA date upcoming. What are your thoughts on their molecule? Their molecule maybe is dosed a little bit less frequently than your molecule. They make an argument that maybe the acute pancreatitis benefit could be reflected in the indication sections of the label instead of the clinical sections of the label. Will any of that matter? So how are you thinking about the impact of a competitor getting into the mix as well?

Well, Luca, we're laser-focused on our program. We've -- the profile of TRYNGOLZA for FCS is second to none with respect to efficacy, pristine safety and the convenience of once-per-month self-administration using a simple, painless, low-volume auto-injector. It doesn't get much more convenient than that. As I mentioned, the launch is off to a very good start, and that's because of the profile and all the work that we've done and also taking advantage, really, really important advantage of being first to market by quite an extended period of time. We were the first to validate this mechanism, APOCIII targeting in FCS. It was really considered to be a bad idea back in the day when we were considering this possibility because of the lack of the lipoprotein lipase pathway, which APOCIII works through in part. We've proved that and we've built a reputation out there as an innovative leader in triglyceride management. The launch is off to a great start. Our market access has gone extremely well. And first-mover advantage is really a key advantage. And then you double down on the much larger indications, severe hypertriglyceridemia, which we're 1.5 to 2 years ahead of any competition with a great-looking drug. And as I mentioned earlier, we already have positive Phase III data this week that we announced from the ESSENCE study to support that. So we're pleased with the profile. Second to none, laser focused on execution and first-mover advantage, we think, is really going to serve us very well.

Got it. Got it. That's actually very helpful. Maybe if you want to talk briefly about the ESSENCE data given that this is fresh off the press, if you will. So maybe if you want to recap the data, that would be helpful. And then maybe two related to it. How are you thinking about acute pancreatitis and the possibility of showing a benefit in acute pancreatitis for severe hypertriglyceridemia, whether you need to hit stat sig or not in your secondary endpoint there? What are maybe the implications for payers and commercial adoption? And maybe related to it, any comments on the blinded event rate? I'm assuming you are seeing blinded event rate for acute pancreatitis. So I know multifaceted questions, but any thoughts there, much appreciate it.

Yes. And thanks for that because I realized when you mentioned AP that I didn't answer your question about acute pancreatitis in FCS. We actually showed substantial significant reductions in acute pancreatitis in our FCS Phase III BALANCE study, which is in our label. So we think that, that, of course, is also serving us very well in the TRYNGOLZA launch for FCS. The ESSENCE Phase III study that we read out earlier this week, the top line data is a safety supportive study in patients with cardiovascular disease and mildly elevated triglycerides. It's a supportive study because of the very large patient -- highly prevalent patient population for patients with severe hypertriglyceridemia, sHTG, millions of people in the United States alone. So it requires by the FDA a minimum safety database for safety exposure for patients to support an approval. The safety aspects of the study was pristine, very successful. But what was also remarkable, what's really remarkable was the substantial reductions in triglycerides that we saw in the study. At the projected commercial dose for sHTG, we saw greater than 60% reductions in triglycerides, and that's on top of standard of care. Almost all these patients in this study were on everything you can take: fibrates, fish oils, statins to lower their triglyceride levels. And on top of that, we actually achieved greater than 60% reduction in triglycerides. And the vast majority of the patients were normalized to normal triglyceride levels. So that's very exciting. It's a big step forward to our Phase III readout in sHTG, CORE and CORE2, that we expected in the third quarter of this year. So very, very pleased. I couldn't be more pleased with the results of the ESSENCE study. Of course, those patients do not have acute pancreatitis events because their triglycerides aren't high enough. That's what we are trying to prevent in the sHTG population and in CORE and CORE2 Phase III studies. We've done extensive market research. We recently had a panel of HCPs that have been managing people with sHTG forever. All these patients are essentially on treatment today. So they've been managing them for decades, but they can't get even close to their triglyceride goals in the study. So they're already convinced that what we need is a new mechanism, like an APOCIII-driven mechanism to substantially lower triglycerides in these patients. And that's what we need to show for rapid and significant uptake in the HCP community, for people with sHTG, substantial triglyceride reductions on the order of what we've seen in FCS and in ESSENCE study. That alone will do it. With respect to acute pancreatitis, as I mentioned, we already have that in the label because this is a supplemental NDA. We have that in the FCS portion of the labels, and that will serve us very well. AP events, the rate of AP is lower. It's quite a bit lower in sHTG than it is in FCS, and that's because it's directly related to the magnitude of triglycerides in study. With that said, it's all about how many events you accumulate in the study. It's not about the rate, right? So our study is more than 10x the size of our FCS Phase III study. So you would expect that we'll be able to accumulate AP events in our patient population that we're studying. And in fact, yes, we are seeing blinded -- in a blinded manner adjudicated AP events. Not surprising because our median -- our mean triglyceride levels in that study, we recently published our baseline clinical trial design paper, is in the 800-plus range. And we have nearly 50% of patients that are approaching 900 milligrams per deciliter of triglycerides. So they're very high risk for acute pancreatitis. A grand slam would be triglyceride lowering on the order of what we've seen in ESSENCE and BALANCE, FCS BALANCE study with favorable trends in acute pancreatitis reduction. So we'll see. We're looking forward to the data in the third quarter. And we'll report in our top line the primary endpoint, safety as well as anything we see in AP.

But the blinded event rate overall is on track with what you originally planned?

We made some projections on how many accumulated AP events we would like to see, estimated to potentially see. And we're in pretty good shape in what we're seeing in the study with respect to AP. I also want to make the point that we're doing everything we can to accumulate as many events as possible. The primary endpoint on triglycerides is at 6 months but with 6-month follow-up. It's a 12-month study. However, the AP secondary endpoint is at 12 months. And we're pooling both the CORE Phase III study as well as the CORE2 Phase III study to be able to accumulate as many events as possible. So we're doing everything we can to get the signal we want. But again, we're really focused on the magnitude and showing substantial reductions in triglycerides, which we think is a real win for this patient population.

Got it. Got it. Super helpful. Maybe let's move on to TTR polyneuropathy, again, your partner obviously with AstraZeneca. I think this quarter was maybe down a little bit quarter-over-quarter. Obviously, there were some headwinds from Medicare Part D redesign, which are important considerations here. But just give us an update on how the launch is going. And then maybe in the context of Alnylam doing $1.3 billion in revenues today for TTR polyneuropathy, where do you think this drug can do at peak in polyneuropathy alone?

So the launch for WAINUA for hereditary TTR polyneuropathy is going great. The revenue was a little bit down because of the IRA redesign, as you mentioned, which kicked in, in January. But the patient demand is very strong. And in fact, the patient numbers in our first quarter exceeded that of our fourth quarter. So it's all about the redesign. Going forward, we expect growth throughout the year and continuing beyond that, up to the expected cardiomyopathy -- through the cardiomyopathy Phase III readout and launch. So patient demand is going great. We haven't carved out polyneuropathy from cardiomyopathy. But I can tell you that our partner, AstraZeneca, our co-development and co-commercialization partner, has stated publicly that they see WAINUA not only as the preferred treatment for TTR amyloidosis in the future, but the commercial revenue that they expect for WAINUA is in the $5 billion-plus range. So we expect WAINUA will do very well. The profile is very strong with respect to efficacy, pristine safety and the convenience of the patients to be able to self-administer using a simple auto-injector. So the WAINUA launch is going very well, and we think that, that will project very well for the cardiomyopathy CARDIO-TTRansform Phase III readout, which we expect in the second half of next year. It's tracking well.

Got it. Got it. Very helpful. Let's maybe talk about TTR cardiomyopathy for a minute. Maybe just one big picture question. What's your take on the competitive landscape and how that competitive landscape is evolving? Will like BridgeBio as well as Alnylam, obviously both launching their drugs, love to pick your brain on how you're seeing that space evolving? And then maybe part two of the question is remind us why you decided to go for Medicare Part D drugs and not Part B. Obviously Part B drugs can be pretty profitable for hospitals, right, when you think about the buy-and-bill dynamic and the 106% that they can essentially pocket as a delta. So again, two-part question, one, how you're seeing the competitive landscape evolving and then, two, remind us why you decided to go for Part D and not Part B.

Sure. So the unmet need for better treatments for TTR cardiomyopathy is still very, very high. We're pleased that the first silencer for targeting TTR for TTR cardiomyopathy is now approved and starting -- it's in launch mode. It really derisks our study greatly. It's the largest study by far ever conducted in this patient population. We have a great drug in WAINUA. TTR lowering that's as good, if not better than anything we've seen out there with excellent safety. And again, the ability for patients to be able to self-administer using an auto-injector bodes very well for our readout in the second half of next year. There are no details on the silencer launch to date. We're looking forward to seeing those. But Attruby has done well. And I think that reflects the fact that patients are unsatisfied. They need better treatment options. I think the estimates on stabilizers, tafamidis, are that 50% of patients progress in the first year and the rest of them progress over 3 years. So patients need a new mechanism. I expect all stabilizer -- that's going to be true for all stabilizers. We need a new mechanism. A silencing mechanism we believe in is going to be the preferred choice for TTR amyloidosis, including cardiomyopathy. And we strongly believe that WAINUA in the silencer class will be well positioned to serve right upfront primary cardiomyopathy, the primary indication as a monotherapy. All those progressing patients that I just mentioned that go from stabilizers, they'll go on to silencers and then also combination use. We're going to have the best data from our Phase III study in combination use as well as monotherapy. Part D, Part B, hey, we have a lot of experience in Part B drugs, right? Our neurology drugs, SPINRAZA, QALSODY, our Angelman's program, they'll all be in the Part B class. So we're not -- we believe in Part B drugs. We believe in Part D drugs. It's really where -- what is best for patients, what is best for our drugs we bring forward. There's going to be patients. There's going to be HCPs that want to buy and bill and be in that Part B drug to make some extra profit maybe from those drugs. But the fact is, is that this is also going to be driven by -- it's a very complex process to do Part -- do buy and bill, inventorying drugs and all of that buying -- billing staff to support patients that are coming in on a frequent -- relatively frequent basis to get a treatment that is perfectly -- that they're perfectly capable of administering themselves at home conveniently. And then once you start getting into very large patient populations, the challenges are going to become even greater. And then when you go from the centers of excellence to the communities, it's going to be even greater. So we believe that patients will prefer the convenience of self-administration. That's going to drive a substantial share of market for Part D drugs for TTR amyloidosis. And not to mention the fact that now the out-of-pocket expenses for -- in the IRA redesign has greatly gone down for patients. That's a tailwind for Part D drugs. So it depends on your view on what is going to be preferred by HCPs and patients. But I think there's going to be plenty of room for a lot of success for Part D drugs in the TTR space going forward.

Sure. No question. A big market even if you look at the latest tafamidis sales. So maybe just a quick question on CARDIO-TTRansform. Just walk us through how that trial is going. Just maybe walk us through the blinded event rate, what you're seeing there. Maybe tafamidis drop in, are you seeing tafamidis drop in kind of on par with your expectations, higher or lower? Just walk us through that part.

Yes. As I mentioned, we're -- we believe that we have the right trial design for the -- to produce the richest data set ever in TTR cardiomyopathy based on the sheer size of the study, more than 1,400 patients, more than double the size of any other study that's ever been conducted to date, which is positioned to give us the richest set in subgroups. Of course, it's been highly derisked based on the silencer that that's already read out, as I mentioned. Richest dataset for subgroups, such as combination usage, monotherapy. We have imaging studies, large imaging studies that are going to be looking to amyloid burden, cardiac function with and without tafamidis. So we're in a very good position to really produce the most beneficial, we think, the most -- the richest data set ever in the space. The study is tracking well. The events are tracking as we anticipated they would track. Doing very well on the blinded events, and we're on track to read out in the second half of next year.

Are you seeing tafa drop in ahead of your -- like this is not becoming standard of care, right?

At baseline, we were well balanced, generally well balanced between tafamidis usage and monotherapy. We're seeing a slight increase in tafamidis drop in based on approvals in Europe. But we're not -- we don't -- we actually think that, that's a tailwind because it will just strengthen our combination data going forward. And most of these patients are dropping in with tafamidis at the very tail end of the study. So the benefit they're going to receive with tafamidis is probably minimal.

Got it. Got it. Very helpful. I know we are already running out of time, but maybe let's -- a couple of more questions here, if I may. One on hereditary angioedema. You already mentioned the PDUFA is upcoming. I guess two-part question. One, is there anything that keeps you up at night about that PDUFA? And then two, I mean, this is a question we got from investors all the time. This is a pretty competitive space. There's a lot of companies that are either launching or have launched. Just maybe remind us what's the differentiation of your molecule versus others.

Yes. Nothing is keeping me up at night on the expected approval for donidalorsen for prophylaxis of hereditary angioedema. We have a PDUFA date of August 21. And we are exactly where we should be in the review process with the FDA. And we're also exactly where we need to be in the European review, which we expect approval next year -- early next year. So that's all going well. There are drugs out there, of course, for prophylaxis of hereditary angioedema. The market leader is TAKHZYRO. And then we have ORLADEYO, an oral drug. And there are drugs that are several years behind donidalorsen that are in development. But what we're focused on is the market leader right now, which is TAKHZYRO. 70% plus patients in the U.S. are on prophy treatment, most of them are on TAKHZYRO. Both prophylactic treatments that are approved today have a large -- a significant amount of unmet need, both on efficacy, tolerability and convenience. Donidalorsen offers very significant advantages in all three areas. We have one of the best HAE attack rate reductions ever seen, probably the best in long-term treatment. The convenience of a simple at-home auto-injector once per month or once every 2 months, a patient can self-administer with excellent tolerability, just like WAINUA, just like TRYNGOLZA, same platform. And we believe that patients are going to want to switch. It's going to be the preferred treatment for many patients for prophylaxis of HAE based on all of this. And our switch data, we actually ran a switch study switching patients from TAKHZYRO, ORLADEYO or other treatments over to donidalorsen. And we not only showed further improvements in efficacy, further reductions of 60% plus on reductions of HAE attacks in that study. Patient preferences were above 80% for donidalorsen. And I could also tell you that patients have stayed on donidalorsen throughout that study, of course, but also long term. And we're keeping them on donidalorsen. So we think doni is going to be a preferred treatment. It's a switch market. We're looking forward to the PDUFA in August. And assuming approval, we will launch in the second half of this year.

Maybe just a super quick follow-up there. How many more sales folks are you expected to hire as you launch an HAE versus your current infrastructure with FCS? And how should we think about the SG&A increase based on the launch of the drug?

Yes. So essentially, everybody has been hired to prepare -- in preparation for the launch. The numbers of sales -- customer-facing field team is on the order of what is out there for drugs today. For prophy, it's in the 50- to 100-person range. And we've already factored that into our guidance for the year and which we've already upgraded at our last -- on our Q1 earnings call. So the impact on SG&A, what we've said in our guidance is that we expect operating losses here in the mid- to high single digits for the year. So we're in good shape there. When we upgraded our guidance at our earnings in March, we said that we're going to -- we're in very good shape. $1.9 billion of cash at the end of the year. Very strong revenue of greater 20% versus our original guidance increase in revenue and under $300 million in net loss. So we're in very good shape there. The team is ready to launch. We're ready to go, and we're looking forward to the doni launch.

Great. I have 300 more questions but no more time. So Brett, thanks so much for joining us. Thanks, everyone, for joining this conversation. And yes, we'll talk soon again.

Thanks, Luca.