Ionis: Two Drug Advancements With Potential Firsts (NASDAQ:IONS)

Ionis Pharmaceuticals, Inc. (NASDAQ:IONS) is a great long-term biotech to look into. The reason why I state this is because it has two catalysts coming up which I believe could boost shareholder value. The first catalyst of note would be potential U.S. regulatory approval of tofersen, which was developed for the treatment of SOD1 amyotrophic lateral sclerosis (SOD1-ALS). Priority review has been given for this drug and the PDUFA date has been established for January 25, 2023.

This drug was licensed from Ionis by Biogen (BIIB) back in 2018. The second catalyst is the NDA filing for eplontersen in the 2nd half of 2022 any day now, for the treatment of patients with hereditary ATTR polyneuropathy. This drug has already been licensed out to AstraZeneca (AZN). Pelacarsen is another solid drug in the pipeline as it is being developed to treat patients with cardiovascular disease and elevated levels of lipoprotein (a), also known as Lp(A). Ionis has also already established a partner for this drug as well, which is with Novartis (NVS). Lastly, Ionis reported positive results from 6 mid-stage study programs already, which means it expects to have 8 phase 3 programs in clinical development to move forward with.

The main thing I want to highlight is the ability for Ionis to establish two potential firsts. What do I mean by that? As it relates to pelacarsen for patients with cardiovascular disease and elevated levels of Lp(A), there are no drugs specifically approved to lower this particle. As I will establish below, not even diet, exercise or lifestyle changes can even affect Lp(A). As such, if Ionis can achieve regulatory approval it will be the first drug of its type to reduce Lp(A) specifically.

The second possible first type of achievement is with tofersen. If the company achieve regulatory approval for this, it would be the first drug of its type to specifically target a genetic cause of ALS. Therefore, such regulatory approvals for these indications wouldn’t only be good for boosting shareholder value, they would also be good in achieving firsts in the medical community. With a few catalysts coming up (one in the 2nd half of 2022 and the other in early 2023, plus the potential advancement of pelacarsen in reducing Lp(A), these are the reasons why I believe Ionis Pharmaceuticals is a great long-term biotech to look into.

Eplontersen Is Set For New Drug Application As It Advances Forward For Polyneuropathy

Ionis and its partner AstraZeneca are gearing up to file a New Drug Application (NDA) to the FDA for the potential approval of eplontersen, which was developed to treat patients with hereditary ATTRv-PN. The reason for the filing is that positive results were achieved the phase 3 study known as NEURO-TTRansform. Before diving into the data, it’s important to note what ATTRv-PN is and why it’s a huge problem. Transthyretin ((ATTR) amyloidosis results in nerve damage. It involves several symptoms such as:

• Not being able to walk
• Weak limbs
• Feeling pain in the body
• numbness of legs/feet

In essence, ATTRv-PN lead to motor disability within 5 years of being diagnosed. More importantly, without any effective treatment option for these patients it can be fatal within 10 years. The phase 3 NEUROTTRansform study was an open-label randomized study which evaluated ATTRv-PN patients. In an interim analysis (at 35 weeks) it was shown that this study achieved both co-primary endpoints with statistical significance. The first endpoint established was percent change in serum Transthyretin (TTR) concentration. Why is this important for this disease? That’s because a buildup of TTR protein causes nerve damage. Thus, eplontersen was shown to reduce TTR production.

The second endpoint achieved was a change in baseline in modified Neuropathy Impairment Score +7 ((mNIS+7). Why was this outcome crucial for patients with this disease? That’s because this score shows disease progression of ATTRv-PN. The higher the score, the greater disease impairment that exists. Thus, eplontersen was shown to achieve statistical significance compared to an external placebo group. Having said all that, Ionis and its partner AstraZeneca plan on submitting a New Drug Application (NDA) to the FDA for eplontersen for ATTRv-PN any day now in the 2nd half of 2022.

Tofersen Potential To Address Patients With Genetically Defined Amyotrophic Lateral Sclerosis

With respect to tofersen, this is what I was talking about above in the introduction as a possible “first.” That’s because this treatment is being developed for patients with SOD1-ALS. Amyotrophic lateral sclerosis (ALS), also known as Lou Gehrig’s Disease, is a devastating disease because of the breakdown of nerve cells in the brain and spinal cord. When these cells are broken down, then the muscles themselves are no longer being supplied. As such, this causes a breakdown of muscle movement. In essence, SOD1 gene mutation causes the death of nerve cells. It is not exactly known what causes this cell death, but it is believed that toxic radicals and superoxide radicals could be responsible.

Still, the key item to note is that positive results were observed in both the VALOR phase 3 study and its open-label extension study. At first the 6 month results were not as clear, but the 12 month data shed more light in that many improvements were observed. There were reductions in neurofilament light, reduced disease progression and reductions of the SOD1 protein. In addition, it was shown that starting treatment earlier helped in slowing disability progression. Having said all that, the NDA was accepted by the FDA for tofersen, which was given Priority Review. A PDUFA date has been established for potential approval of this drug for patients with SOD1 ALS of January 25, 2023. The study results being included involve results from these studies which are:

• Phase 1 study healthy volunteers
• Phase 1/2 dose ascending study
• Phase 3 VALOR study
• Phase 3 VALOR open label extension study

One thing to note is that Ionis and Biogen are seeking accelerated approval based on changes in neurofilament observed. What is neurofilament? It is a biomarker used to determine nerve cell damage. In both starting treatments early and delayed treatment groups, reductions of plasma neurofilament light achieved were 51% and 41% respectively. In addition, there was a reduction in SOD1 protein by 33% and 21% respectively as well. I think that there is a good chance for regulatory approval, but the risk/unknown is whether or not the neurofilament biomarker will be enough for FDA accelerated approval for SOD1-ALS. Even if the FDA considers the reductions observed in the SOD1 protein there is no guarantee that Accelerated approval will be granted. Still, this is a huge unmet medical need and the hope is that the FDA will pave the way for a specific treatment option for these patients. There are several drugs approved to treat ALS, but not specifically SOD1 ALS.

Pelacarsen Offers Potential To Lower Lipoprotein A In Patients With Cardiovascular Disease

Ionis, along with its partner Novartis, are advancing development of pelacarsen for the treatment of cardiovascular patients with elevated levels of Lipoprotein (A) or Lp(A). Cardiovascular disease (CVD) is a condition which affects the heart or blood vessels. What happens is that a huge build-up of fatty deposits exists inside the arteries. As such, this type of situation can lead to a stroke or heart attack. Lp(A) is a type of LDL, in that it carries cholesterol to the cells in your arteries. However, the problem is that this type of LDL is stickier compared to the others. In turn, this causes a greater likelihood of blockages occurring in the arteries. Not only that, but what makes this a huge unmet need is that there are no specific treatments approved to address this specific type of LDL.

If Ionis and its partner Novartis can achieve regulatory approval of this drug, then it would be the first of its type to reduce Lp(A). To put this into perspective, consider this example. Let’s say you take a cholesterol lab test and your total LDL cholesterol (overall cholesterol) score is good. That doesn’t mean anything if you have high levels of lipoprotein (A) particles. You would still be at a huge risk for heart disease or stroke despite healthy levels of LDL cholesterol. There are many risk factors, but such instances of Lp(A) causing a problem makes sense. Consider that about 50% of people who have heart attacks still have a normal cholesterol level. In addition, whereas with LDL-C you can make lifestyle changes, exercise or diet, you can’t do the same with Lp(A). Lp(A) doesn’t respond to these changes at all. What does this mean? This means that a treatment option like pelacarsen could possibly achieve a “first” as I described in the beginning above. That is, pelacarsen could possibly be the first treatment approved to specifically address high levels of Lp(A) in the blood.

About a month ago, it was announced that enrollment was completed for the ongoing phase 3 HORIZON cardiovascular outcomes study. In this late-stage clinical trial 8,325 patients are given pelacarsen to see if it can reduce cardiovascular events in patients with cardiovascular disease (CVD) and elevated levels of Lp(A). The primary endpoint is to assess potential superiority of pelacarsen compared to placebo in reducing the risk of expanded Major Adverse Cardiovascular Events (MACE) over a 4-year period. Enrollment for this study was completed on July 20, 2022. Topline results from this phase 3 HORIZON study are not expected until 2025. Still, I see great potential based on prior data from a mid-stage study. Results from a phase 2 study showed that pelacarsen reduced Lp(A) levels below the recommended threshold of risk for Cardiovascular events (<50 mg/DL) in about 98% of patients. The very same dose used in this prior phase 2 study, is what is also being used in the ongoing phase 3 HORIZON study.

Financials

According to the 10-Q SEC Filing, Ionis Pharmaceuticals had $2 billion in cash and short-term investments as of June 30, 2022. It believes it is well capitalized to fund its operations to drive future growth. Revenue itself in the most recent quarter increased more than 15% and this was because of payments made by many of its partners. It received $57 million from Biogen for neurology program advancement, $37 million from AstraZeneca for global development of eplontersen and $22 million from Roche (OTCQX:RHHBY) for the advancement of IONIS-FB-LRX. The commercial revenue struggled in the 1st half of 2022, where it fell by 12% compared to the same period last year. That’s because of SPINRAZA sales seeing a decline because of competition outside of the United States. In the U.S. though, sales of SPINRAZA stabilized to about 2% in the 1st half of 2022.

Risks To Business

There are several risks that investors should be aware of before investing in this company. The fist risk involves to the ongoing sales of SPINRAZA. Looking at the financials, royalties has fallen. For instance, in June of 2021, royalties for this product was $72.2 million. However, in June of 2022 it was reported that royalties for SPINRAZA was $59.6 million. There is no guarantee that sales will pick up in the coming quarters, as such royalties could still continue to drop.

Another risk to consider would be the upcoming PDUFA date of January 25, 2023, which the FDA is set to decide if tofersen should receive FDA accelerated approval for the treatment of patients with SOD1-ALS. Based on what I stated above, I think it is a huge unmet need which the FDA will take into consideration. Why I think this remains a risk is that there is no guarantee that the FDA will agree that both biomarkers of, reduction of SOD1 protein and reduction of plasma neurofilament light, will merit such Accelerated Approval. I would hope they would be inclined to approval tofersen for SOD1-ALS, but honestly it just depends if the FDA decides the data observed warrants regulatory approval.

Conclusion

The final conclusion is that Ionis Pharmaceuticals is a great long-term company to own. I know it has its problems right now with SPINRAZA, but it is getting very close to possibly receiving approval of tofersen for the treatment of patients with SOD1-ALS and is gearing up to file a New Drug Application (NDA) to the FDA for potential approval of eplontersen for the treatment of patients with ATTRv-PN. Such an NDA filing of this drug for this specific indication is expected to occur in the 2nd half of 2022. Lastly, it is hoping to get pelacarsen to the finish line eventually for the treatment of patients with cardiovascular disease (CVD) and with elevated levels of Lp(A). The downside is that these results are not expected until 2025. Still, I believe that Ionis should be watched on the basis of the entire pipeline it has. While these three drugs I noted here hold potential, there is plenty more based on what has been achieved thus far. It has achieved positive mid-stage clinical trial results with 6 programs and expects to have 8 programs in phase 3 development in the coming years. I believe that SPINRAZA sales will continue to struggle so the short-term may not be so great, but its long-term potential exists based on these other programs I have discussed. Plus, the other late-stage programs it has. With a growing pipeline, plus potential to earn a few “firsts” in terms of unmet medical needs, these are the reasons why I believe Ionis Pharmaceuticals is a great long-term company to own.