Isis Reports In-Line Loss


Isis Pharmaceuticals Inc. (ISIS) reported a net loss of 3 cents per share in the first quarter of 2013, in line with the Zacks Consensus Estimate. The loss was narrower than the year-ago loss of 23 cents, benefiting from higher revenues.

Revenues increased 86.6% to $43.4 million, missing the Zacks Consensus Estimate of $52 million. Revenues include license fees, milestone-related payments and other payments.

In the first quarter of 2013, the company received a milestone payment of $25 million from its partner Sanofi (SNY). The payment was received following the US approval of Kynamro (mipomersen sodium) for the treatment of familial hypercholesterolemia (:FH).

In Feb 2013, Isis Pharma received a $7.5 million milestone payment from GlaxoSmithKline (GSK). The payment primarily relates to the initiation of a phase II/III clinical study of ISIS-TTR. The study will span 15 months enrolling 200 patients. Isis is developing ISIS-TTR in collaboration with Glaxo for the potential treatment of transthyretin (:TTR) amyloidosis.

Operating expenses remained flat during the first quarter of 2013 at $41.7 million. Research and development expenses decreased 1.0% to $38.3 million and general and administrative expenses were up 15.0% to $3.4 million.

We note that in the second quarter of 2013, Isis Pharma is expected to record significant milestone revenues. The company has already received an upfront payment of $30 million from the Huntington's disease (HD) collaboration. Additionally, Isis Pharma is also expected to record $3.5 million of milestone payment related to ISIS-SMN.

Isis Pharma boasts of a promising pipeline of 28 candidates with several candidates expected to reach the market by 2017. Key near-term events include: release of top-line data from the phase II study evaluating ISIS-APOCIII for the treatment of severe hypertriglyceridemia and data from a phase II study evaluating the use of ISIS-CRP in rheumatoid arthritis (:RA) patients.

Meanwhile, Isis Pharma has also announced its plans to initiate a public offering of 10.35 million shares of common stock including an over-allotment option for 1.35 shares.   

Isis Pharma currently carries a Zacks Rank #2 (Buy). Stocks such as Lannett Company, Inc. (LCI) look more attractive in the pharma sector with a Zacks Rank #1 (Strong Buy).

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