Release Details
Isis Reports Strong Financial Results and Highlights for Fiscal Year 2008
- Exceeds 2008 Projections for Net Operating Income and Year-End Cash
- Achieves 2008 Positive Pro Forma Net Operating Income and Net Income
- Conference Call Webcast
CARLSBAD, Calif.,
"We believe that we are now at the beginning phase of sustained financial
strength as evidenced by our 2008 financial results. With the sale of Ibis at
the beginning of 2009, we started the year with more than
"We are projecting pro forma net income in 2009 of more than
Upcoming Key Milestones
-- Report data from a Phase 3 study evaluating mipomersen in homozygous
Familial Hypercholesterolemia (FH) patients and from additional
mipomersen studies in other patient populations
-- Report data from a Phase 2 study evaluating ISIS 113715 in combination
with sulfonylureas in patients with type 2 diabetes
-- Begin clinical trials on three to five drugs per year
-- Expand pipeline by moving three to five new drugs into the development
pipeline per year in a diverse set of new diseases
Financial Results
As a result of selling Ibis to AMI, Ibis' financial results are considered discontinued operations. Accordingly, the operating results of Ibis for 2008 and all prior periods are presented in Isis' financial statements separately as discontinued operations.
The considerable improvement in the Company's pro forma and GAAP operating results was driven primarily by the significant increase in revenue in 2008 from Isis' corporate partnerships. This was offset, in part, by higher expenses associated with the expansion of the Company's programs and, for Isis' GAAP results, an increase in non-cash stock compensation expense reflecting the increase in Isis' stock price over the same periods. Please refer to the reconciliation of pro forma and GAAP measures, which are explained later in this release.
Revenue
Revenue from continuing operations for the year ended
Operating Expenses
On a pro forma basis, operating expenses from continuing operations for
the year ended
Net Loss from Continuing Operations
Net loss from continuing operations for the year ended
Net Loss from Discontinued Operations
The net loss from discontinued operations represents the operating results
of Ibis that are presented separately in Isis' financial statements as a
result of the sale of Ibis to AMI in
Net Loss and Net Loss Applicable to Common Stock
Isis' net loss applicable to common stock for the year ended
Balance Sheet
As of
-- $325 million from Genzyme
-- $20 million from GSK (for its transaction with Regulus)
-- $215 million from AMI (for its transaction with Ibis)
As of
Regulus Therapeutics
Regulus' revenue for the year ended
Excluding non-cash compensation expense related to stock options,
operating expenses for Regulus were
Business Highlights
"Our pipeline has matured significantly in the past year. Together with
our partner,
"We believe that we have just begun to benefit from the efficiency of our
technology. The successes that we have had in the past two years have
generated more than
"We have many key milestones to look forward to in 2009, with the most significant being the data from our Phase 3 study evaluating mipomersen in patients with homozygous FH. Also we and our partners expect to report data from some of the other drugs in our pipeline in a number of different diseases, including metabolic diseases. We will aggressively grow our pipeline, adding 3 to 5 new drugs per year and advancing the drugs currently in our pipeline. In short, 2008 was a remarkable year for us. Our successes this past year bring our drugs closer to commercialization and reflect the type of shareholder value we can create. We look forward to another exciting year," concluded Ms. Parshall.
Drug Development Highlights
Isis and
-- Completing enrollment in a Phase 3 mipomersen study in homozygous FH
subjects.
-- Initiating four additional mipomersen studies in high-risk patients,
including three Phase 3 studies in heterozygous FH subjects, high-risk
hypercholesterolemia and severe hypercholesterolemia patients and a
Phase 2 study in statin-intolerant patients.
-- Reporting additional safety data including mipomersen data from a
Phase 2 mipomersen liver imaging study in heterozygous FH subjects and
long-term dosing data in FH patients exposed to mipomersen from three
to 23 months.
-- Publishing preclinical data showing that lowering of apoB-100 resulted
in significant reduction of atherosclerotic plaques in murine models
of atherosclerosis.
In addition, Isis and its partners showed encouraging clinical results in a broad range of diseases including,
-- Encouraging Phase 2 data of OGX-011 in prostate cancer patients
showing survival advantage, durable reductions in pain, and declines
in PSA.
-- Positive Phase 2 results showing that ATL/TV1102 demonstrated a highly
significant effect on disease activity in patients with multiple
sclerosis.
-- Interim data from an ongoing Phase 1 study showing that iCo-007
appears to be well tolerated in patients with diffuse diabetic macular
edema.
Isis broadened its pipeline with the addition of new drugs that Isis' partners are developing including,
-- An antisense drug that targets PCSK9, BMS-PCSK9Rx.
-- An antisense drug for the local treatment of fibrosis and scarring,
EXC001.
-- A novel aminoglycoside drug, ACHN-490, which Achaogen is developing to
treat bacterial infections.
Isis' pipeline matured with the initiation of clinical trials in multiple drugs including,
-- ISIS-CRPRx to treat coronary artery disease, inflammation and
end-stage renal disease.
-- ISIS-SGLT2Rx to treat type 2 diabetes.
-- AIR645 to treat asthma.
-- LY2181308 to treat cancer.
Corporate Highlights
Isis continued to execute its successful business strategy by monetizing key assets with partners to continue the development and commercialization of the assets with lucrative terms in upfront payments, milestones and participation in the commercial success of each asset.
-- Licensed mipomersen toGenzyme and received$325 million in an upfront license fee and equity investment with the potential to earn over$1.5 billion in potential commercial and developmental milestone payments, and a share of profits for Isis on mipomersen ranging from 30 to 50%. -- Sold its Ibis subsidiary to AMI for a total purchase price of$215 million , plus a 5% earn out on sales of assay kits and services.
Isis benefits financially as its partners advance drugs in development while also receiving upfront and royalty payments. This strategy provides cash to the Company while the drugs in Isis' pipeline mature in clinical development.
-- ATL licensed ATL/TV1102 to Teva in a deal with a potential$100 million value in which Isis will receive one-third of licensing fees plus significant royalties. -- Isis received a$2 million milestone payment from BMS for the selection of a development candidate, BMS-PCSK9Rx. -- Isis received a$1 million milestone payment from Achaogen for the IND of Achaogen's aminoglycoside drug. -- Regulus entered into a strategic alliance with GSK with an upfront payment of$20 million and the potential to earn up to nearly$600 million in milestone payments plus royalties. Isis has significantly strengthened the Company's financial position. -- Isis exceeded its 2008 net operating loss guidance of less than$15 million and ended 2008 with positive pro forma net operating income and net income. -- Isis exceeded its 2008 cash guidance of$450 million by ending 2008 with over$490 million in cash. -- During 2008, Isis reported multiple profitable quarters.
Conference Call
At
About
Isis is exploiting its expertise in RNA to discover and develop novel
drugs for its product pipeline and for its partners. The Company has
successfully commercialized the world's first antisense drug and has 19 drugs
in development. Isis' drug development programs are focused on treating
cardiovascular and metabolic diseases. Isis' partners are developing
antisense drugs invented by Isis to treat a wide variety of diseases. Isis is
a joint owner of
This press release includes forward-looking statements regarding
In this press release, unless the context requires otherwise, "Isis,"
"Company," "we," "our," and "us" refers to
Isis Pharmaceuticals is a registered trademark of Isis Pharmaceuticals,
Inc. Regulus Therapeutics is a trademark of Regulus Therapeutics Inc.
ISIS PHARMACEUTICALS, INC.
SELECTED FINANCIAL INFORMATION
Condensed Consolidated Statements of Operations
(In Thousands, Except Per Share Data)
Three months ended, Years ended,
December 31, December 31,
2008 2007 2008 2007
(unaudited)
Revenue:
Research and
development revenue
under collaborative
agreements $29,103 $13,020 $98,853 $22,319
Licensing and royalty
revenue 546 8,535 8,337 36,025
Total revenue 29,649 21,555 107,190 58,344
Expenses:
Research and
development 33,343 23,583 106,439 78,204
General and
administrative 4,382 4,227 13,811 13,059
Total operating
expenses 37,725 27,810 120,250 91,263
Loss from operations (8,076) (6,255) (13,060) (32,919)
Other income
(expense):
Investment income 2,514 2,386 11,318 11,443
Interest expense (1,306) (1,441) (5,603) (7,573)
Gain (loss) on
investments, net (965) - (965) 3,510
Loss on early
retirement of debt - - - (3,212)
Loss attributed to
noncontrolling
interest in Symphony
GenIsis, Inc. - - - 23,157
Loss attributed to
noncontrolling
interest in
Regulus Therapeutics 1,678 542 4,734 629
Net loss from
continuing operations (6,155) (4,768) (3,576) (4,965)
Net loss from
discontinued
operations (2,503) (2,189) (8,387) (6,029)
Excess purchase price
over carrying value
of noncontrolling
interest in Symphony
GenIsis, Inc. - - - (125,311)
Net loss applicable to
common stock $(8,658) $(6,957) $(11,963) $(136,305)
Basic and diluted net
loss per share from
continuing operations $(0.06) $(0.05) $(0.04) $(0.06)
Basic and diluted net
loss per share
applicable to common
stock $(0.09) $(0.08) $(0.13) $(1.63)
Shares used in
computing basic and
diluted net loss per
share 96,889 86,970 94,566 83,739
Isis Pharmaceuticals, Inc.
Reconciliation of GAAP to Pro Forma Basis:
Condensed Consolidated Operating Expenses and Loss From Operations
(In Thousands)
Three months ended, Years ended,
December 31, December 31,
2008 2007 2008 2007
(unaudited) (unaudited)
As reported operating
expenses according to GAAP $37,725 $27,810 $120,250 $91,263
Excluding compensation
expense related to stock
options pursuant to SFAS
123(R) (2,852) (2,302) (13,286) (8,298)
Pro forma operating expenses $34,873 $25,508 $106,964 $82,965
As reported loss from
operations according to
GAAP $(8,076) $(6,255) $(13,060) $(32,919)
Excluding compensation
expense related to stock
options pursuant to SFAS
123(R) (2,852) (2,302) (13,286) (8,298)
Pro forma income (loss) from
operations $(5,224) $(3,953) $226 $(24,621)
As reported net loss
according to GAAP $(8,658) $(6,957) $(11,963) $(10,994)
Excluding compensation
expense related to stock
options pursuant to SFAS
123(R) (3,248) (2,702) (15,063) (9,910)
Pro forma net income (loss) $(5,410) $(4,255) $3,100 $(1,084)
Reconciliation of GAAP to Pro Forma Basis
As illustrated in the Selected Financial Information in this press release, pro forma operating expenses, pro forma loss from operations and pro forma net income (loss) were adjusted from GAAP to exclude compensation expense related to stock options, which are non-cash. Isis has regularly reported non-GAAP measures for operating expenses and loss from operations as pro forma results. These measures are provided as supplementary information and are not a substitute for financial measures calculated in accordance with GAAP. Isis reports these pro forma results to better enable financial statement users to assess and compare its historical performance and project its future operating results and cash flows. Further, the presentation of Isis' pro forma results is consistent with how Isis' management internally evaluates the performance of its operations.
Regulus Therapeutics
Statements of Operations
(In Thousands)
Three months ended, Years ended,
December 31, December 31,
2008 2007 2008 2007
(unaudited) (unaudited)
Revenue:
Research and development
revenue under
collaborative agreements $681 $78 $2,110 $119
Total revenue 681 78 2,110 119
Expenses:
Research and
development 2,738 734 8,030 833
General and
administrative 673 161 2,001 191
Total operating
expenses 3,411 895 10,031 1,024
Loss from operations $(2,730) $(817) $(7,921) $(905)
Isis Pharmaceuticals, Inc.
Condensed Consolidated Balance Sheets
(In Thousands)
December 31, December 31,
2008 2007
Assets:
Cash, cash equivalents and short-term
investments $490,998 $193,719
Other current assets 27,386 16,155
Property, plant and equipment, net 17,371 5,960
Other assets 38,395 43,024
Total assets $574,150 $258,858
Liabilities, noncontrolling interest and
stockholders' equity:
Other current liabilities $32,036 $30,670
Current portion of deferred contract revenue 92,662 31,535
2 5/8% convertible subordinated notes 162,500 162,500
Long-term obligations, less current portion 9,938 362
Long-term deferred contract revenue 172,766 23,548
Noncontrolling interest in Regulus
Therapeutics 4,737 9,371
Noncontrolling interest in Ibis Biosciences,
Inc. - held for sale 32,419 -
Stockholders' equity 67,092 872
Total liabilities, noncontrolling interest
and stockholders' equity $574,150 $258,858
SOURCEIsis Pharmaceuticals, Inc. -0-02/25/2009 /CONTACT: Kristina Lemonidis, Director, Corporate Communications, +1-760-603-2490, orAmy Blackley , Ph.D., Assistant Director, Corporate Communications, +1-760-603-2772, both ofIsis Pharmaceuticals, Inc. / /Web Site: http://www.isispharm.com / (ISIS) CO:Isis Pharmaceuticals, Inc. ST:California IN: HEA MTC PHA SU: ERN CCA PR -- LA74880 -- 803002/25/2009 07:00 EST http://www.prnewswire.com