GuruFocus Premium Membership

Serving Intelligent Investors since 2004. Only 96 cents a day.

Free Trial

Free 7-day Trial
All Articles and Columns »

Isis Pharmaceuticals Inc. Reports Operating Results (10-Q)

November 05, 2010 | About:
10qk

10qk

18 followers
Isis Pharmaceuticals Inc. (ISIS) filed Quarterly Report for the period ended 2010-09-30.

Isis Pharmaceuticals Inc. has a market cap of $957.9 million; its shares were traded at around $9.46 with and P/S ratio of 7.9. ISIS is in the portfolios of Columbia Wanger of Columbia Wanger Asset Management, Bruce Kovner of Caxton Associates, Jim Simons of Renaissance Technologies LLC, George Soros of Soros Fund Management LLC.

Highlight of Business Operations:

Total revenue for the three and nine months ended September 30, 2010 was $28.6 million and $82.1 million, respectively, compared to $26.8 million and $89.3 million for the same periods in 2009. Our revenue fluctuates based on the nature and timing of payments under agreements with our partners, including license fees, milestone-related payments and other payments. We recognized new revenue in the first nine months of 2010 in the form of an upfront fee from our new partnership with GSK, which is amortized through the first quarter of 2015, milestone payments from GSK, BMS and Achaogen and sublicensing income from Regulus collaboration with sanofi-aventis. Although we recognized this new revenue, our revenue for 2010 decreased compared to 2009 because the amortization of the upfront fee from our Ortho-McNeil-Janssen Pharmaceuticals, Inc., or OMJP, collaboration ended in the third quarter of 2009. Additionally, revenue for the first nine months of 2010 decreased by $2.4 million because we are no longer including Regulus revenue in our 2010 revenue.

Research and development revenue under collaborative agreements for the three and nine months ended September 30, 2010 was $27.8 million and $77.5 million, respectively, compared to $26.0 million and $86.4 million for the same periods in 2009. Although we recognized $13 million of revenue for the milestone payments we received and the $3.5 million of amortization of revenue related to the upfront payment we received from GSK in the first nine months of 2010, our revenue compared to the first nine months of 2009 decreased, primarily because revenue from our collaborations with OMJP ended in the third quarter of 2009. Research and development revenue also decreased by $2.4 million because we are no longer including Regulus revenue in our 2010 revenue.

Our revenue from licensing activities and royalties for the three and nine months ended September 30, 2010 was $839,000 and $4.6 million, respectively, compared to $809,000 and $2.9 million for the same periods in 2009. The increase primarily relates to the $1.9 million sublicensing revenue we earned from Regulus in the second quarter of 2010 when Regulus entered into a strategic alliance with sanofi-aventis.

Operating expenses for the three and nine months ended September 30, 2010 were $37.6 million and $114.6 million, respectively, compared to $37.2 million and $105.2 million for the same periods in 2009. The higher expenses in 2010 were primarily due to an increase in costs associated with advancing mipomersen toward its initial regulatory filings for marketing approval planned for the first half of next year and offset in part by an $8.3 million decrease because we are no longer including Regulus operating expenses in our 2010 operating expenses. We expect to increase operating expenses in the fourth quarter of 2010 as we initiate a broad Phase 2 program on one of the drugs in our pipeline.

For the three and nine months ended September 30, 2010, we incurred total research and development expenses of $32.2 million and $97.9 million, respectively, compared to $30.9 million and $86.5 million for the same periods in 2009. The higher expenses in 2010 were primarily due to an increase in costs associated with advancing mipomersen toward its initial regulatory filings for marketing approval planned for the first half of next year offset in part by a $6.5 million decrease because we are no longer including Regulus research and development expenses in our 2010 operating expenses. All amounts discussed exclude non-cash compensation expense related to stock options.

Antisense drug development expenditures were $12.8 million and $42.5 million for the three and nine months ended September 30, 2010, compared to $12.3 million and $33.3 million for the same periods in 2009, all amounts exclude non-cash compensation expense related to stock options. We attribute the increase to the broad Phase 3 program for mipomersen and an increase in other antisense development projects due to the expansion of our drug pipeline.

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 5.0/5 (2 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK