What: Shares of ISIS Pharmaceuticals (NASDAQ:IONS), a biopharmaceutical company using its proprietary antisense technology platform to develop therapies across a wide range of diseases, catapulted higher by 19% in October, based on data from S&P Capital IQ, after announcing that it had earned two milestone payments from collaborative partner GlaxoSmithKline (NYSE:GSK), and unveiling midstage data on ISIS-SMNrx.
So what: ISIS received a big boost in October after announcing on Oct. 1 and Oct. 9 that it had earned separate milestone payments from its licensing partner GlaxoSmithKline. On Oct. 1 ISIS's press release notes that it earned $1.5 million for the "advancement of the program to develop ISIS-GSK4rx to treat an undisclosed ocular disease." The release also notes that the drug should be moving into clinical development shortly.
Just over a week later ISIS announced that it earned a more robust $18 million milestone payment for the advancement of its phase 2/3 study involving ISIS-TTRrx for patients with familial amyloid polyneuropathy. ISIS-TTRrx is the most advanced late-stage drug currently in ISIS's pipeline, and the experimental drug has generated $45 million of a possible $70 million in milestone revenue for ISIS. These milestone payments keep ISIS's research and development coffers well-funded, and allows it to avoid diluting investors with unwelcome secondary offerings.
Lastly, ISIS announced positive data from its midstage study involving ISIS-SMNrx for infants and children with spinal muscular atrophy. Specifically, ISIS noted increases in muscle function scores for infants, with those receiving the 6 mg dose showing a median ventilator-free age of 16.3 months, or more than 50% higher than the expected average without treatment. The drug is being moved into phase 3 studies and could represent a new way to fight SMA, which currently has few treatment options.
Now what: If there's one word to describe ISIS here it's "stacked" with 35 ongoing clinical and preclinical studies and around one dozen collaborative partners.
Imagine you're in a home run hitting contest and you win a prize if you can hit two or three home runs. Now imagine you have 35 pitches with which to do so. That's ISIS's current situation, and it won't be difficult for the company to hit home runs with the myriad of partners and financial backing it possesses. Though it could be a few years before ISIS turns profitable on an annual basis, the company's pipeline is so deep that its revenue could wind up doubling every couple of years throughout the next decade (assuming it hits a few "home runs"). Shares aren't nearly as intriguing as they were just a few months ago following its October run, but even now I could see additional long term upside to ISIS' share price.
Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.
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