What happened

Ionis Pharmaceuticals (NASDAQ:IONS) is down 11.4%, while Alnylam Pharmaceuticals (NASDAQ:ALNY) is up 13.4% at 12:11 p.m. EDT for the same reason: Ionis Pharmaceuticals issued clinical trial data for its familial amyloid polyneuropathy drug that has investors worried about the drug's safety.

So what

Ionis pharmaceuticals' phase 3 NEURO-TTR study testing inotersen, which used to go by the code name IONIS-TTRRX, actually passed its primary endpoints. Both the modified Neuropathy Impairment Score +7 (mNIS+7) and the Norfolk Quality of Life Questionnaire-Diabetic Neuropathy (Norfolk QoL-DN), which are both measures of symptoms in patients with familial amyloid polyneuropathy, showed a statistically significant benefit in patients taking inotersen compared to placebo.

Despite the positive efficacy data, the drug's side effects have investors worried. The company had already disclosed an increased rate of thrombocytopenia -- low blood platelet levels -- in patients taking inotersen, but today's data release reveled that one of those patients died due to intracranial hemorrhage. There were also some renal side effects as well. On the plus side, Ionis noted that since the company discovered the problem and implemented enhanced monitoring procedures, there haven't been any serious adverse events.

Doctor talking to patient

Image source: Getty Images.

Alnylam Pharmaceuticals' shares are up because it has a competing drug candidate, patisiran, which is scheduled to announce its phase 3 results in "mid-2017," so data should come shortly.

Now what

This battle certainly isn't over; Alnylam Pharmaceuticals still needs to read out positive phase 3 data without any side effects of its own. Even if Alnylam's patisiran works better than placebo, if the efficacy isn't as good as inotersen, patients and doctors might be willing to risk the side effects, especially since there are laboratory tests to help identify side effects before they become a serious problem. The time it takes for each drug to start working could also come into play. Ionis noted that there was a statistically significant difference in the mNIS+7 and Norfolk QoL-DN as early as eight months.

Nevertheless, investors are moving the stock prices for both companies in the correct direction on this news. Ionis traded this low as recently as last month, so the move down today basically gave up the ramp-up in anticipation of the data. And Alnylam is certainly worth more today because it's less risky -- partially because its competitor doesn't have strong safety data, but more importantly, because both drugs have the same mechanism of action, so it seems likely patisiran will also help familial amyloid polyneuropathy patients, although the magnitude of that efficacy is still unknown.

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