Ionis Pharmaceuticals (NASDAQ:IONS) released fourth-quarter earnings on Thursday, the first time since renaming itself from Isis Pharmaceuticals, but it was business as usual at the biotech, with management more focused on the pipeline than the earnings -- as it should be.

Ionis Pharmaceuticals results: The raw numbers


Q4 2015 Actuals

Q4 2014 Actuals

Growth (YOY)

Cash, Cash Equivalents and Short-Term Investments

$779 million

$729 million


Data source: Ionis Pharmaceuticals.

What happened with Ionis Pharmaceuticals this quarter?

  • Cash is the most important number investors should watch at unprofitable companies, and Ionis Pharmaceuticals has done a good job at keeping its level high, even increasing it in 2015 thanks to getting more than $320 million in cash from partners.
  • But the biotech reported a net loss for the quarter and full year; the difference in cash and earnings has to do with reporting requirements for when cash from partners is booked -- typically over a series of years even though Ionis gets the cash all at once.
  • The company gained rights to Kynamro back from Sanofi's (NASDAQ:SNY) Genzyme division in January. The drug was always presumed to be a big flop because Sanofi never disclosed sales, so ending the partnership isn't a big surprise and could offer upside that Ionis could find another partner.
  • On the pipeline front, Ionis had a busy end of the year with the initiation of quite a few clinical trials and data readouts for others, including IONS-TTRRx at the First European Congress on Hereditary ATTRamyloidosis and IONS-APO(a)-Rx and its related compound IONS-APO(a)-LRx at American Heart Association Scientific Sessions.

What management had to say
When confronted about Sanofi's Genzyme handing back Kynamro and whether the company could finally let investors know how many patients are on the drug, Ionis' Chairman, President and CEO Stan Crooke was a little wishy-washy:

It's a little complicated. It is the case that we and Genzyme have agreed to end the partnership, and it is a case we have the rights to the drug back, but it is still the case that Genzyme has the NDA and is continuing to sell and do all the things that relate to that, and they have all that information. We do not.

Image source: Sanofi.

On the pipeline front, Ionis' CFO Beth Hougen threw out the "p" word: "Efforts are under way to prepare for the commercial launch of our phase 3 drugs, any one of which has the potential to make us profitable." I'd get excited about how she said "any" of the late-stage drugs could make the company profitable, but she also qualified it with "has the potential."

Looking forward
This year will still be an unprofitable year for Ionis, but the company is expecting revenue of more than $240 million, most of which will come from partners, including a $55 million milestone payment from Bayer for advancing IONIS-FXIRx. And the potential for a $25 million milestone from AstraZeneca for advancing a drug in their cardiometabolic collaboration.

Ionis thinks it'll end the year with a cash balance in excess of $600 million, which should put it in good shape going into 2017, when there will be multiple phase 3 readouts resulting in the potential approval of multiple drugs.

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