Ionis Pharmaceuticals, Inc. ($IONS)

Thanks, everybody. Luca Issi, Senior Biotech Analyst here at RBC Capital Markets. And today is our great privilege to have Ionis Pharmaceuticals as part of our 2026 Global Healthcare Conference. Representative of the company, we have Holly Kordasiewicz, who is the Chief Development Officer; Holly, thanks so much for joining us. How are you doing today?

Great. How are you?

Good, good, good, good. Yes. We have a list of questions. But maybe before we go into the specifics, it will be fantastic if you can maybe talk a little bit big picture about what progress has the organization made over the last few months and kind of most importantly, Ionis?

Yes, absolutely. So it's been an exciting time. We had our first 2 independent launches last year with TRYNGOLZA in FCS and DAWNZERA and HAE. We're, of course, planning for 2 PDUFA this year. For again, we have TRYNGOLZA for sHTG coming up in June. Hopefully approval and then launch. And then at the end of the year, we have Zilganersen for the treatment of Alexander's disease, which is our first wholly owned neurology program that we'll be launching. Following behind that, we then have 5 Phase III readouts this year. The first is bepirovirsen, of course, this was positive. The data is going to be presented later this month at EASL, we then have 2 cardiovascular outcome trials reporting out later this year. One is cardio transform for ATTR-CM and then, of course, pelacarsen, the HORIZON study looking at Lp(a) lowering. And then behind that, we have a robust mid-stage pipeline that's advancing, and of course, our partners at Biogen just last week announced the tau program and that they're going to be advancing that into Phase III clinical testing. So busy times but lots of opportunities for continued growth in 2026 and beyond at Ionis.

Got it. Got it. Super helpful. I'm going to start asking you about your questions now. I know you're not going to answer. But I'll ask anyways. Obviously tau data fresh off the press. Biogen presented the top line data last week. It sounds like the data is good enough for them to actually pursue a Phase III trial. Just tell us a little bit more about what is your reaction to that top line data? And is there any context you can provide in terms of like what benefit they have shown in terms of [ CDR ] sum of the boxes or ADAS-Cog and how does that benefit kind of compares to the a-beta antibodies, like I think that's some of the questions we're getting from investors. So any comments would be much appreciated.

First to start, I will be excited about this program and this data for the 80 patients and community. This is a new mechanism of action. So here, we are using an oligonucleotide to lower tau. So we're lowering intracellular tile because we're stopping production of tau. So a new way to go after the disease. In our Phase I study, we had robust reductions in CSF tau, which is our pharmacodynamic biomarker as well as reversal of tau PET. So it was the first time in an AD brain, where we actually showed clearance of pathological tau. So that biomarker data in the CELIA Phase II study, which Biogen just reported on last week, it replicated. So we have those nice reductions in CSF tau and tau PET. And then it also showed, and this is what it was designed to do, a benefit on cognitive endpoints. And they were unprecedented. It is the first time anyone has shown this with tau. They are in line with what has been shown with amyloid therapies and, in some cases, exceed it. So very encouraged by the data. It met Biogen's prespecified endpoints for going into a Phase III. So excited that they're advancing that. They have the data that gives them confidence to do that as well as the data needed to select dose and design that next study.

Got it. Got it. Super helpful. Any context on how placebo has formed in that trial. Obviously, we're seeing, especially in small data sets, sometimes placebo underperformed or overperformed can magnify the benefit or underrepresent the benefits. Is there any context of what placebo has shown in that trial?

So fortunately, in the space, we have lots of data on how this should perform in this patient population. And there's nothing in either the biomarker data or the cognition data that says it's not performing as expected.

Got it. That's super encouraging. What about the lack of dose response, if you will. I mean, obviously, Biogen have mentioned that the cohort that showed the best cognitive benefit was actually the lowest dose, which is obviously a little counterintuitive. I guess, what's the best way to rationalize that. If I recall it correctly, the lowest dose is also the one that has the smallest end. So could that have been confounding and amplify the benefit? Or how should we think about that part.

I think so. So all doses showed a benefit. That's the important point is all those has showed a benefit. And there's overlapping of all of that data. And so this isn't unexpected given the doses that were used in the target engagement that we observed. And that will all become clear once the totality of the data is presented at AAIC in July.

Right? I guess we stay tuned for dead data that is obviously coming. Maybe just pivoting to severe hot progress. Obviously, the PDUFA date is only 6 weeks away. How do you feel about it? Are you guys already in discussions with the FDA?

It's progressing as planned. We feel excellent about it. Of course, this is Phase III study where we had beautiful data, efficacy data. Here, we had an 85% reduction in AP events in people with high triglycerides. And so that we also received a breakthrough therapy designation based on that data. and that gives us a lot of confidence going into the discussions with regulators. Everything is on track for that PDUFA date on June 30.

Got it. Got it. That's actually helpful. I think when you look at the data set, there's maybe a little bit of a worsening in liver fat. And again, it's -- the magnitude of the increase in liver fat is relatively modest. But how should we think about how that data will be potentially reflected on the label? Do you think that that's going to only be in the diverse sections of the label? Could there be something more? Could this be like a REMS or a black box warning or how should we think about the...

No. So. it is well tolerated in CORE-1 and CORE-2 studies and in the ASCEND study. So we do not expect any monitoring or anything like that. This is -- to be clear, this isn't a safety signal. This is a biomarker signal that does not correlate with any sequelae or any other safety signals or biomarkers. This is information that has been shared broadly with HCPs. They have no concerns about this given, of course, the benefit profile that we see with TRYNGOLZA. And so taken together, this is not of a concern. This is on mechanism. This isn't unexpected, given that we are drastically lowering triglycerides over 70% in the Phase III studies, that rapid clearance of triglycerides it's going to end up in the liver. Another important thing is that we're following these individuals over time from the CORE-1 and CORE-2 studies, they were all able to roll into an open-label extension where we're continuing to monitor this for over 2 years. And over time, we're seeing stabilization and then coming back towards baseline.

Got it. Got it. That's actually helpful. For severe hypertriglyceridemia, how are you thinking about the TAM. Because I think, obviously, there are a lot of patients out there that have severe hypertriglyceridemia. However, when you look at the patients that have severe hypertriglyceridemia and a history of acute pancreatitis is the TAM is much smaller, maybe like single digits type of percentage when you reflect on the 3 million versus the one that have historic pancreatitis. So is this going to be a aimer prevention type of drug for patients that don't have the historic pancreatitis will receive the therapy? Or do you think the scenario the payers will restrict the access to this drug to primarily the patients that have historic pancreatitis up? How we think about it versus secondary prevention?

Yes. So we've set this program up specifically not to restrict access. So there's 3 million patients that have high triglycerides over 500. Within that 1 million patients, we consider a high risk. And those are the original patients that we'll be focusing on. Everybody over 80, which then puts them at severe risk and then over 500 with history of acute pancreatitis, and that's still 1 million patients. So that's where we'll be starting. But we will get to all those patients then at 500 and above that do have risk of acute pancreatitis.

Got it. Got it. That's helpful. Maybe pricing, it feels like your thinking around pricing has evolved over time. And you now obviously have settled to $40,000 as the -- your WAC. However, your competitor last week came forward with $45,000 WAC. And again, I think they have an argument that maybe their drug is dosed less frequently, and they could have some pharmacological properties that are different versus your molecule? Like -- what's your take on what was your reaction to Arrowhead actually pricing their drug of $45,000 versus $40,000?

So our approach is entirely data-driven. So we first did HCP research. We're using our CORE-1 and CORE-2 data. So with our Phase III data, we took that out to understand demand once we understood demand with existing Phase III data in hand, we then were able to talk to payers and work out the pricing implications based on that as well to find a price that would get us the broadest access to the most individuals, so not limiting the access but still having a favorable price. And then that's where we learned it on the $40,000 WAC. And so for our -- for the other company, they don't have Phase III data yet. They don't have information in sHTG. And so we did a data-driven approach.

Got it. Got it. That's helpful. Obviously, the company has guided peak revenues. And I think that has been a little bit of a moving part. I think you guys started with $1 billion, then I think JPMorgan was $2 billion, I should say, $1 billion plus, then became $2 billion plus and now most recently is $3 billion plus. Walk us through like some of the assumptions in your model that got you there? Is it just simply a function of price? Or there are other variables, including either access or discontinuations or walk us through the evolution from $1 billion to $3 billion. That's a big delta.

So the first [indiscernible] it was demand eased on the data. So the Phase III data was excellent. We had an 85% reduction in acute pancreatitis events. This leads to a number needed to treat in 1 year in the high-risk group, the over 80 of 4. So only 4 patients need to be treated at 1 to prevent an acute pancreatitis attack and only 20 patients in that larger population. So with that really remarkable efficacy data, we then took that out and did the demand research. And it was the initial demand research that led us from that $1 billion to the $2 billion. And just the sheer number of patients, the doctors are planning on prescribing this for. Then once we got to the $2 billion, then we did the pricing work. And we had initially assumed a lower price. And then once we had done that work in hand to make sure that we weren't restricting access to the broader patient population that we would still be able to get the drug to everybody that we need to get it to, and that's where we increased it from $2 billion to greater than $3 billion.

Super clear.

And just to say it, this is a population that didn't exist before we had this drug and the way that we're now thinking about it. So this growth isn't unexpected given that we're just learning as we're doing this and generating the data.

Yes, yes. And certainly conversations with payers and what not, obviously influence some of these assumptions, so makes to sense to me. Maybe, again, going back to your competitor, I think investors are under age their seats waiting for the SHASTA-3 and SHASTA-4 data. Again, their trial is designed slightly different than your trial, ruble smaller trial. There's also some differences around randomization. So we're not -- what's your take? Do you think that Arrowhead had a chance of hitting the second -- key secondary endpoint of reduction in acute pancreatitis in a statistical significant fashion?

I think they have a good chance it's going to be really hard to beat. It's a high number, but I think they have a good chance at it. And that's actually favorable in that having 2 people out or 2 companies out on the market is only going to help, as we just discussed, that this is a new market, it's a growing market. And so having more voices out there to help raise awareness is going to help those patients.

And we certainly have seen that movie over and over again with more players, there's also often market expansion there. So it's sometimes it's not about market share, but it's more like market expansion. So maybe if I can pivot to Angelman, which I know it's your bread and butter, if you will. Maybe just talk about big picture of what data have you seen so far? Maybe just remind us about differentiations versus Ultragenyx and maybe just walk us through what's next year. Maybe if I can, quickly, things that comes up in conversations with investors a decent amount. Can you just refresh our memory for why Biogen ultimately decided to pass on that program.

Yes. So first of all, this is a neuro development disease. So this is not a degenerative disease like some of our other CNS programs where we see decline. These are individuals who they develop cognitively to about the age of a 2- to 4-year-old and then they stay that way for the rest of their lives, and they have a normal lifespan. So what we've seen in our Phase I study, which is our open-label HALOS study, it was an improvement across domains and across measures. So these individuals have motor, communication, cognition, this function. And across the board, we saw benefits across all those various domains. As you would expect, if you were restarting neuro development, which is the mechanism that we think will be happening by targeting the underlying cause of the disease. We also saw this across measures that were physician administered, physician reported and parent reported. So it's nice in an open-label setting to see consistency in the data across different ways of collecting it. So we have a benefit across these different domains, a restarting of development that appears to be happening in individuals that really just have stable development once they hit that peak at about 2- to 4-year-old neurotypical development. And so with that, that gave us confidence to go into the Phase III study. The Phase III study is enrolling right now. We plan to complete enrollment for that this year. It's a 1-year primary endpoint in the REVEAL study, and so then that will read out next year. And then in terms of Biogen and why they passed, there was risk in the endpoint. They wanted to derisk that. They wanted more information. We did not want to give any more time. This is a program that we very much wanted back. We wanted to build our neurology portfolio. We had pivoted as a company from just an R&D company to an R&D who is going to then take things through commercialization. We saw this as a really attractive fit, as you can imagine, with Alexander disease, which is launching later this year, assuming approval. And so in total, this is something we want back. We didn't want to negotiate. They want to negotiate and so it's ours.

Got it. Got it. Got it. That's super helpful. What's your take on the Ultragenyx approach? I think it's fascinating to me that there are splitting alpha actually between 2 separate endpoint, right? So obviously, they have daily store cognition and they're spending most of the alpha on the Bayley-4 cognition, but they also spend some of the alpha who MDRI, which is more of a composite endpoint. You obviously, you have a different approach here because you have a separate primary endpoint using expressive communication as a primary point. Have you -- are you potentially considering doing something similar where you split the alpine, -- you maybe have kind of 2 shots on goal? Or what's your take there?

So we'll see the data. So right now, we are focusing on our primary endpoint, which is expressive communication. This is the #1 thing that is most important for caregivers. There was a listening session last year with the parents overwhelmingly said, I want my child to be able to tell me when something is wrong to tell me what they want. These individuals, most of them are nonverbal. So as you can imagine, it's very difficult for the family. So that's the main thing that they care about. It was also the thing that we saw the greatest effect on earliest and it had the most stable natural history, so the most stable baseline. So it gives you the biggest delta for, in effect, in a Phase III study. And so with that, we have confidence that we have a meaningful endpoint. It's also clinical meaningfulness. The expressive communication is if someone is communicating, they're going to score higher on it. So it has inherent meaningfulness in that. That's very different than some of the other endpoints, which are building blocks, how do you judge the clinical meaningfulness of building blocks, where clinical meaningfulness of communication is implicit. And so that taken together, we're happy with where we're at. But of course, we'll see the data. We'll see the data. This is one of the benefits of coming second is that we can see that readout and then adjust based on data as necessary.

Got you. Can you expand on adjusted necessary? Like I mean, I guess, what are you primarily focused on is to see the data from Ultragenyx? It sounds like their data is coming late this summer. So like what are you primarily focused on? And do you have optionality in your protocol to amend the protocol and maybe make the protocol -- maybe your trial either longer or bigger like talk us through on some of the moving parts there and how you're thinking of potentially adjusting your trial base their data.

So we're looking for the placebo effect. So nobody knows the placebo effect in Angelman syndrome at this later time point. There has been shorter studies, but there haven't been 1-year long studies with these clinical endpoints in Angelman. So that's the #1 thing to look at because all the data generated to date is open label. And so seeing that will be very meaningful. And then, of course, how the different responses are. Now if they don't have a robust response, that's -- that's not surprising, given that they're using a very low dose, but we will pay attention to that as well. And then in terms of adjusting things like our SAP can be easily adjusted.

Got you. And especially because they're going to probably read out at the time where your trial is not fully enrolled yet. Would that be a fair assumption at this point or not necessarily?

No, not necessarily. We're not giving out any of those kind of data.

But you're saying...

Can change.

But you're saying that the trial will be -- your trial to fully enroll second half of this year? Is that...

We haven't given the details this year.

Okay. Okay. Okay. That's helpful. Maybe one last question on Angelman. Maybe just remind us the commercial opportunity here, should it tryouts work? How many patients are out there? Maybe I know it's preliminary at this point, but just any commentary at high level or how you're thinking about pricing?

Yes. So this is a -- there's 100,000 individuals, we think, in the U.S. in major markets, and this is a rare neurological disease. So we expect it to be similar to previous to other rare programs that we have, assuming positive Phase III data in efficacy.

SPINRAZA type of pricing or too early to comment...

Too early to comment. We're within that rare neural range.

Okay. Okay. That's helpful. You mentioned cardio transform. I think a lot of people are obviously eager to see that data. I think you presented recently the baseline characteristics. I think you highlighted that -- this is much more of a contemporaneous population. So like there's a lot more patients on tafamidis to baseline or more patients on SGLT2 are baseline and what not. So -- just maybe just remind us how you design your trial and at the end of the day, how confident are you -- I believe you now have 3x the number of patients that Alnylam had on HELIOS-B on tafamidis baseline, I think it's 819 but they only had 259 patients tafamidis -- is 819 patients tafamidis baseline, a large enough sample size that you think you can actually hit the stats as add-on to tafamidis.

Yes. So that is not the expectation. So it is not powered for statistical significance on the secondaries. We did release the study design recently. And as you can see, at 6 in the hierarchy. So it is in the secondary hierarchy, but it is 6. So everything else would have to hit to get there. And so we are encouraged, though, by the size of the study. We intentionally designed this as a very large study, as you mentioned. We have more folks on tafamidis than there were in the total previous studies. And this will give us information about how it's behaving. So the expectation for this study is on par with what the previous silencer data has looked like. And then anything with tafamidis is going to be on top of that and upside.

Got you. Got you. Okay. That's helpful. You mentioned earlier LOI's probably one of the biggest catalyst in medicine maybe to is going to be the next cholesterol, who knows. However, I think you powered a trial to show a 20% to 25% benefit depending on what sub populations you're looking at. However, it feels to me that some of the recent commentary from Novartis kind of implies that maybe the benefit could be a little more modest. So maybe instead of 20% to 25% relative risk reduction, this could be more like in mid 10% or 15% relative risk reduction. Should that be the case? Do you think that, that would still be a commercially viable product?

Yes. So nobody knows what the rate risk reduction is going to be. That's the trial that we're doing right now. This is another first for Ionis, where we're asking for the first time, if you lower the largest untreated risk factor in cardiovascular disease, what kind of benefit can you have? And so we'll find that when the trial reads out. The question on is 10% to 15% enough yes, and that's really from research and talking to KOLs and getting feedback from the community on what they would need to see to treat. And the answer is that 10% to 15%. So that's where that shift is coming from. And it's really based on the fact that with the human genetics -- this is very clear that this is an independent risk factor. So you can control everything else, you can get the LDL down extremely low, and you still have this risk that's coming from the Lp(a). So because there's nothing to treat it because this is an on mechanism directly on target treatment that they would then do that.

Got it. Got it. That's actually helpful. That's actually helpful. Maybe just fill into the out of PDUFA date did you have upcoming Alexander disease a small indication, maybe just talk about what would an approval for the community, which would be obviously huge given the unmet medical need. And then I mean how confident are you in approval, again, technically, I believe the p-value was 0.0412, so relatively close to the 0.05 kind of magic number. So like how do you feel about probability of approval at this point?

We hit that tag on a primary endpoint that's clinically meaningful for patients. in an ultra-rare patient population. So very excited about that. We got breakthrough therapy designation because of that. So confident going into this that there's a path forward. and a very clear one and straightforward one, given that we have that beautiful data. And what this means for the community is an excellent question and most important, the outpouring from the community has been just overwhelming when we announced this data. They have nothing. This is a progressive neurodegenerative disease that affects children that affects adults. It is almost always ultimately fatal. It affects most systems. And so there's motor, there's cognition. There's across the board effects that these families are dealing with in these individuals. You hear the parents talk about it. And the kids game a new developmental skill and then they lose it because the disease progresses. And so they work so hard to get something and then they lose it. And what we've shown in the data is a stabilization. And then if you have that stabilization in the motor endpoint, which is the primary endpoint that once they make those gains, they can keep them. And then we also have in the secondaries, they all favored zidinersen and that -- so that targeting of the underlying disease is providing that broad benefit for the individuals. So with that, in totally, very excited about this program and to get this to patients. We have an EAP open. It's enrolling very well, lots of enthusiasm brand to continue to try to get this to as many folks as possible.

Got it. I have a lot more questions, but limited time. Thanks. Appreciate your time. Thanks, everyone, for joining, and we'll talk soon.

Thanks again.