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)

May 07, 2010 | About:

10qk

18 followers
Isis Pharmaceuticals Inc. (ISIS) filed Quarterly Report for the period ended 2010-03-31.

Isis Pharmaceuticals Inc. has a market cap of $949 million; its shares were traded at around $9.58 with and P/S ratio of 7.9. ISIS is in the portfolios of Jim Simons of Renaissance Technologies LLC, Jean-Marie Eveillard of Arnhold & S. Bleichroeder Advisers, LLC.

Highlight of Business Operations:

· We are eligible to receive up to $155 million in pre-licensing payments for all six programs, including the $35 million upfront fee we recently received. We are also eligible to receive up to double-digit royalties on sales from any product that is successfully commercialized.

Total revenue for the three months ended March 31, 2010 was $29.9 million, compared to $31.6 million for the same period 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. For example, our revenue in the first quarter of 2010 included a $6 million milestone payment that we received from BMS for initiating Phase 1 studies on PCSK9. Although we recognized revenue from the BMS milestone payment in the first quarter of 2010, our revenue compared to the same period in 2009 decreased slightly, primarily because the amortization of the upfront fee from the Ortho-McNeil-Janssen Pharmaceuticals, Inc., or OMJP, collaboration ended in the third quarter of 2009. Revenue also decreased by $638,000 because we are no longer including Regulus revenue in our 2010 revenue. In the second quarter of 2010, we will begin amortizing the $35 million upfront payment we received from our recent alliance with GSK into revenue through March 2015.

Research and development revenue under collaborative agreements for the three months ended March 31, 2010 was $28.6 million, compared to $29.7 million for the same period in 2009. The decrease was primarily due to the decrease in revenue from our collaboration with OMJP that we describe above offset by the $6 million milestone payment received from BMS. Research and development revenue also decreased by $638,000 because we are no longer including Regulus revenue in our 2010 revenue.

Operating expenses for the three months ended March 31, 2010 were $34.8 million, compared to $32.2 million for the same period in 2009. The higher expenses in 2010 were primarily due to an increase in research and development activities related to the ongoing mipomersen development program and the research activities necessary to achieve our goal of adding three to five new drugs to our pipeline offset by a $2.5 million decrease because we are no longer including Regulus operating expenses in our 2010 operating expenses.

For the three months ended March 31, 2010, we incurred total research and development expenses of $29.2 million, compared to $26.3 million for the same period in 2009. The higher expenses in 2010 were primarily due to an increase in research and development activities related to the ongoing mipomersen development program and the research activities necessary to achieve our goal of adding three to five new drugs to our pipeline offset by a $2.2 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 $11.8 million for the three months ended March 31, 2010, compared to $10.5 million for the same period in 2009, both amounts exclude non-cash compensation expense related to stock options. We attribute the increase primarily to the broad Phase 3 program for mipomersen slightly offset by the decrease in our metabolic disease development projects. Development overhead costs were $1.4 million for the three months ended March 31, 2010 and were slightly higher compared to $1.3 million for the same period in 2009.

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 3.7/5 (3 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