☒ |
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
33-0336973
|
|
(State or other jurisdiction of incorporation or organization)
|
(IRS Employer Identification No.)
|
2855 Gazelle Court, Carlsbad, CA
|
92010
|
|
(Address of Principal Executive Offices)
|
(Zip Code)
|
Title of each class
|
Trading symbol
|
Name of each exchange on which registered
|
||
Common Stock, $.001 Par Value
|
“IONS”
|
The Nasdaq Stock Market LLC
|
Large Accelerated Filer ☒
|
Accelerated Filer ☐
|
|
Non-accelerated Filer ☐
|
Smaller Reporting Company ☐
|
|
Emerging Growth Company ☐
|
* |
Excludes 23,957,052 shares of common stock held by directors and officers and by stockholders whose beneficial ownership is known by the Registrant to exceed 10 percent of the common stock outstanding at June 30, 2019. Exclusion of shares held by any person should not be construed to indicate that such person possesses the power, direct or indirect, to direct or cause the direction of the management or policies of the Registrant, or that such person is controlled by or under common control with the Registrant.
|
PART I
|
||
Page
|
||
Item 1.
|
Business
|
4
|
Item 1A.
|
Risk Factors
|
40
|
Item 1B.
|
Unresolved Staff Comments
|
52
|
Item 2.
|
Properties
|
52
|
Item 3.
|
Legal Proceedings
|
52
|
Item 4.
|
Mine Safety Disclosures
|
52
|
PART II
|
||
Item 5.
|
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
|
53
|
Item 6.
|
Selected Financial Data
|
55
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
56
|
Item 7A.
|
Quantitative and Qualitative Disclosures About Market Risk
|
70
|
Item 8.
|
Financial Statements and Supplementary Data
|
70
|
Item 9.
|
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
|
70
|
Item 9A.
|
Controls and Procedures
|
70
|
Item 9B.
|
Other Information
|
73
|
PART III
|
||
Item 10.
|
Directors, Executive Officers and Corporate Governance
|
73
|
Item 11.
|
Executive Compensation
|
73
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
73
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence
|
73
|
Item 14.
|
Principal Accounting Fees and Services
|
73
|
PART IV
|
||
Item 15.
|
Exhibits, Financial Statement Schedules
|
74
|
Signatures
|
82
|
* |
China rights only
|
* |
China rights only
|
● |
Direct intervention in the disease process at the genetic level by targeting RNA: antisense technology represents a direct route from gene to drug. The explosion in genomic information and RNA biology has led to the discovery of many new disease-causing proteins and RNAs and has created new opportunities that are uniquely accessible to antisense technology.
|
● |
Precise specificity: we design antisense medicines to target a single RNA, which minimizes or eliminates the possibility our medicines will bind to unintended targets, which can cause unwanted side effects.
|
● |
Good drug properties: antisense medicines distribute well throughout the body without the need for special formulations or vehicles. They also have a relatively long half-life in the range of weeks to months, which means patients and/or healthcare providers can dose our medicines weekly, monthly or even less frequently depending on the medicine and target tissue.
|
● |
Ability to combine with other medicines: because antisense medicines do not interact with the enzymes that metabolize or break down other medicines, physicians can use our medicines in combination with other medicines.
|
● |
Broad applications to multiple disease targets, multiple tissues and multiple mechanisms: there are virtually no “undruggable” targets with antisense technology.
|
● |
Efficient discovery and early development: because of the efficiency of our antisense technology, our drug discovery and early development costs and success rates compare favorably to small molecule or antibody drug discovery and development.
|
Type of Patent Claim
(Broadly Applicable to Specific)
|
||
● Chemically Modified Nucleosides and Oligonucleotides (target and sequence independent)
● Antisense Drug Design Motifs (target and sequence independent)
● Therapeutic Methods (sequence and chemistry independent)
● Antisense Sequence (chemistry independent)
● Drug Composition
|
|
Jurisdiction
|
Patent No.
|
Title
|
Expiration
|
Description of Claims
|
||||
United States
|
7,101,993
|
OLIGONUCLEOTIDES CONTAINING 2’O-MODIFIED PURINES
|
2023
|
Covers certain MOE nucleosides and oligonucleotides containing these nucleotides.
|
||||
United States
|
7,399,845
|
6-MODIFIED BICYCLIC NUCLEIC ACID ANALOGS
|
2027
|
Covers our cEt nucleosides and oligonucleotides containing these nucleoside analogs.
|
||||
United States
|
7,741,457
|
6-MODIFIED BICYCLIC NUCLEIC ACID ANALOGS
|
2027
|
Covers our cEt nucleosides and oligonucleotides containing these nucleoside analogs.
|
||||
United States
|
8,022,193
|
6-MODIFIED BICYCLIC NUCLEIC ACID ANALOGS
|
2027
|
Covers oligonucleotides containing cEt nucleoside analogs.
|
||||
United States
|
7,569,686
|
COMPOUNDS AND METHODS FOR SYNTHESIS OF BICYCLIC NUCLEIC ACID ANALOGS
|
2027
|
Covers methods of synthesizing our cEt nucleosides.
|
||||
Europe
|
1984381
|
6-MODIFIED BICYCLIC NUCLEIC ACID ANALOGS
|
2027
|
Covers our cEt nucleosides and oligonucleotides containing these nucleoside analogs.
|
||||
Europe
|
2314594
|
6-MODIFIED BICYCLIC NUCLEIC ACID ANALOGS
|
2027
|
Covers our cEt oligonucleotides and methods of use.
|
||||
Japan
|
5342881
|
6-MODIFIED BICYCLIC NUCLEIC ACID ANALOGS
|
2027
|
Covers our cEt nucleosides and oligonucleotides containing these nucleoside analogs.
|
Jurisdiction
|
Patent No.
|
Title
|
Expiration
|
Description of Claims
|
||||
United States
|
7,015,315
|
GAPPED OLIGONUCLEOTIDES
|
2023
|
2’-O-alkyl-O-alkyl gapmer oligonucleotides.
|
||||
Europe
|
2021472
|
COMPOUNDS AND METHODS FOR MODULATING GENE EXPRESSION
|
2027
|
Short gapmer oligonucleotides, having wings of 2 bicyclic nucleosides, and a gap of 10 deoxynucleotides for the treatment of cardiovascular or metabolic disorders
|
||||
United States
|
7,750,131
|
5’-MODIFIED BICYCLIC NUCLEIC ACID ANALOGS
|
2027
|
5’-Methyl BNA containing gapmer compounds
|
||||
United States
|
9,550,988
|
ANTISENSE COMPOUNDS
|
2028
|
Gapmer oligonucleotides having BNA nucleosides and 2’-MOE nucleosides
|
||||
United States
|
10,493,092
|
ANTISENSE COMPOUNDS
|
2028
|
Gapmer oligonucleotides having BNA nucleosides and 2’-MOE nucleosides and/or 2’-OMe nucleosides
|
||||
Europe
|
2092065
|
ANTISENSE COMPOUNDS
|
2027
|
Gapmer compounds having 2’-modifed and LNA nucleosides
|
||||
Europe
|
2410053
|
ANTISENSE COMPOUNDS
|
2027
|
Gapmer compounds having wings comprised of 2’-MOE and bicyclic nucleosides
|
||||
Europe
|
2410054
|
ANTISENSE COMPOUNDS
|
2027
|
Gapmer compounds having a 2’-modifed nucleoside in the 5’-wing and a bicyclic nucleoside in the 3’-wing
|
||||
Japan
|
5665317
|
ANTISENSE COMPOUNDS
|
2027
|
Gapmer oligonucleotides having wings comprised of 2’-MOE and bicyclic nucleosides
|
||||
Europe
|
3067421
|
OLIGOMERIC COMPOUNDS COMPRISING BICYCLIC NUCLEOTIDES AND USES THEREOF
|
2032
|
Gapmer oligonucleotides having at least one bicyclic, one 2’-modified nucleoside and on 2’-deoxynucleoside
|
Jurisdiction
|
Patent
|
Title
|
Expiration
|
Description of Claims
|
||||
United States
|
9,127,276
|
CONJUGATED ANTISENSE COMPOUNDS AND THEIR USE
|
2034
|
Preferred THA LICA conjugated to any group of nucleosides, including gapmers, double-stranded siRNA compounds, and fully modified oligonucleotides
|
||||
United States
|
9,181,549
|
CONJUGATED ANTISENSE COMPOUNDS AND THEIR USE
|
2034
|
Preferred THA conjugate having our preferred linker and cleavable moiety conjugated to any oligomeric compound or any nucleoside having a 2’-MOE modification or a cEt modification
|
||||
Europe
|
2991661
|
CONJUGATED ANTISENSE COMPOUNDS AND THEIR USE
|
2034
|
Preferred THA LICA conjugated to any group of nucleosides, including gapmers, double-stranded siRNA compounds, and fully modified oligonucleotides
|
Jurisdiction
|
Patent No.
|
Title
|
Expiration
|
Description of Claims
|
||||
United States
|
8,361,977
|
COMPOSITIONS AND METHODS FOR MODULATION OF SMN2 SPLICING
|
2030
|
Sequence and chemistry (full 2’-MOE) of SPINRAZA
|
||||
Europe
|
1910395
|
COMPOSITIONS AND METHODS FOR MODULATION OF SMN2 SPLICING
|
2026
|
Sequence and chemistry (full 2’-MOE) of SPINRAZA
|
||||
Europe
|
3308788
|
COMPOSITIONS AND METHODS FOR MODULATION OF SMN2 SPLICING
|
2026
|
Pharmaceutical compositions that include SPINRAZA
|
||||
United States
|
7,838,657
|
SPINAL MUSCULAR ATROPHY (SMA) TREATMENT VIA TARGETING OF SMN2 SPLICE SITE INHIBITORY SEQUENCES
|
2027
|
Oligonucleotides having sequence of SPINRAZA
|
||||
United States
|
10,266,822
|
SPINAL MUSCULAR ATROPHY (SMA) TREATMENT VIA TARGETING OF SMN2 SPLICE SITE INHIBITORY SEQUENCES
|
2025
|
Methods of increasing exon-7 containing SMN2 mRNA in a cell using an oligonucleotide having the sequence of SPINRAZA
|
||||
United States
|
8,110,560
|
SPINAL MUSCULAR ATROPHY (SMA) TREATMENT VIA TARGETING OF SMN2 SPLICE SITE INHIBITORY SEQUENCES
|
2025
|
Methods of using antisense oligonucleotides having sequence of SPINRAZA to alter splicing of SMN2 and/or to treat SMA
|
||||
United States
|
8,980,853
|
COMPOSITIONS AND METHODS FOR MODULATION OF SMN2 SPLICING IN A SUBJECT
|
2030
|
Methods of administering SPINRAZA
|
||||
United States
|
9,717,750
|
COMPOSITIONS AND METHODS FOR MODULATION OF SMN2 SPLICING IN A SUBJECT
|
2030
|
Methods of administering SPINRAZA to a patient
|
||||
Europe
|
3449926
|
COMPOSITIONS AND METHODS FOR MODULATION OF SMN2 SPLICING IN A SUBJECT
|
2030
|
Antisense compounds including SPINRAZA for treating SMA
|
Jurisdiction
|
Patent No.
|
Title
|
Expiration
|
Description of Claims
|
||||
United States
|
8,101,743
|
MODULATION OF TRANSTHYRETIN EXPRESSION
|
2025
|
Antisense sequence and chemistry of TEGSEDI
|
||||
United States
|
8,697,860
|
DIAGNOSIS AND TREATMENT OF DISEASE
|
2031
|
Composition of TEGSEDI
|
||||
United States
|
9,061,044
|
MODULATION OF TRANSTHYRETIN EXPRESSION
|
2031
|
Sodium salt composition of TEGSEDI
|
||||
United States
|
9,399,774
|
MODULATION OF TRANSTHYRETIN EXPRESSION
|
2031
|
Methods of treating transthyretin amyloidosis by administering TEGSEDI
|
||||
Europe
|
2563920
|
MODULATION OF TRANSTHYRETIN EXPRESSION
|
2031
|
Composition of TEGSEDI
|
Jurisdiction
|
Patent No.
|
Title
|
Expiration
|
Description of Claims
|
||||
United States
|
9,624,496
|
MODULATION OF APOLIPOPROTEIN C-III EXPRESSION
|
2023
|
Antisense compounds specifically hybridizable within the nucleotide region of apoCIII targeted by WAYLIVRA
|
||||
United States
|
7,598,227
|
MODULATION OF APOLIPOPROTEIN C-III EXPRESSION
|
2023
|
Methods of treating hyperlipidemia, lowering cholesterol levels or lowering triglyceride levels with WAYLIVRA
|
||||
United States
|
7,750,141
|
MODULATION OF APOLIPOPROTEIN C-III EXPRESSION
|
2023
|
Antisense sequence and chemistry of WAYLIVRA
|
||||
Europe
|
1622597
|
MODULATION OF APOLIPOPROTEIN C-III EXPRESSION
|
2024
|
Antisense sequence and chemistry of WAYLIVRA
|
||||
Europe
|
2441449
|
MODULATION OF APOLIPOPROTEIN C-III EXPRESSION
|
2024
|
Antisense compounds specifically hybridizable within the nucleotide region of apoCIII targeted by WAYLIVRA
|
||||
Europe
|
3002007
|
MODULATION OF APOLIPOPROTEIN C-III EXPRESSION
|
2024
|
Compounds complementary to an apoCIII nucleic acid for use in therapy
|
||||
United States
|
9,157,082
|
MODULATION OF APOLIPOPROTEIN CIII (APOCIII) EXPRESSION
|
2032
|
Methods of using APOCIII antisense oligonucleotides for reducing pancreatitis and chylomicronemia and increasing HDL
|
Jurisdiction
|
Patent No.
|
Title
|
Expiration
|
Description of Claims
|
||||
United States
|
9,273,315
|
MODULATION OF HUNTINGTIN EXPRESSION
|
2030
|
Composition of tominersen
|
||||
United States
|
8,906,873
|
MODULATION OF HUNTINGTIN EXPRESSION
|
2030
|
Methods of treating Huntington’s disease by administering tominersen
|
||||
Europe
|
2475675
|
MODULATION OF HUNTINGTIN EXPRESSION
|
2030
|
Composition of tominersen
|
||||
United States
|
7,951,934
|
COMPOSITIONS AND THEIR USES DIRECTED TO HUNTINGTIN
|
2027
|
Antisense sequence of tominersen
|
||||
United States
|
8,952,145
|
COMPOSITIONS AND THEIR USES DIRECTED TO HUNTINGTIN
|
2027
|
Antisense compound specifically hybridizable within the nucleotide region of HTT targeted by tominersen
|
||||
Europe
|
2161038
|
COMPOSITIONS AND THEIR USES DIRECTED TO HUNTINGTIN
|
2027
|
Antisense sequence of tominersen
|
Jurisdiction
|
Patent No.
|
Title
|
Expiration
|
Description of Claims
|
||||
United States
|
10,385,341
|
COMPOSITIONS FOR MODULATING SOD-1 EXPRESSION
|
2036
|
Composition of tofersen
|
||||
United States
|
8,993,529
|
ANTISENSE MODULATION OF SUPEROXIDE DISMUTASE 1, SOLUBLE EXPRESSION
|
2021
|
Antisense compound specifically hybridizable within nucleotide region of SOD-1 targeted by tofersen
|
||||
Europe
|
EP2270024
|
ANTISENSE MODULATION OF SUPEROXIDE DISMUTASE 1, SOLUBLE EXPRESSION
|
2022
|
Antisense compound specifically hybridizable within nucleotide region of SOD-1 targeted by tofersen
|
Jurisdiction
|
Patent No.
|
Title
|
Expiration
|
Description of Claims
|
||||
United States
|
9,574,193
|
METHODS AND COMPOSITIONS FOR MODULATING APOLIPOPROTEIN (A) EXPRESSION
|
2033
|
Compounds that include an oligonucleotide complementary to the region of the Apo(a) transcript where AKCEA-APO(a)-LRx binds
|
||||
United States
|
10,478,448
|
METHODS AND COMPOSITIONS FOR MODULATING APOLIPOPROTEIN (A) EXPRESSION
|
2033
|
Methods of treating hyberlipidemia using oligonucleotide complementary to the region of the Apo(a) transcript where AKCEA-APO(a)-LRx binds
|
||||
United States
|
9,181,550
|
COMPOSITIONS AND METHODS FOR MODULATING APOLIPOPROTEIN (a) EXPRESSION
|
2034
|
The composition of AKCEA-APO(a)-LRx
|
● |
The federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, which governs the conduct of certain electronic healthcare transactions and protects the security and privacy of protected health information;
|
● |
Foreign and state laws governing the privacy and security of health information, such as the General Data Protection Regulation, or GDPR, in the EU;
|
● |
The California Consumer Privacy Act, or CCPA, in California, some of which are more stringent than HIPAA and many of which differ from each other in significant ways and may not have the same effect; and
|
● |
The Physician Payments Sunshine Act, which requires manufacturers of medicines, devices, biologics, and medical supplies to report annually to the U.S. Department of Health and Human Services information related to payments and other transfers of value to physicians and teaching hospitals, and ownership and investment interests held by physicians and their immediate family members.
|
Medicine
|
Company
|
Medicine Description (1)
|
Phase (1)
|
Route of Administration (1)
|
Next Milestones (1)
|
|||||
Zolgensma
(AVXS-101)
|
Novartis
|
Gene therapy designed to target the genetic root cause of SMA by replacing the function of the missing or nonworking SMN1 gene
|
Approved (U.S.)
|
Infusion
|
- Approval decision for EU expected in the first quarter of 2020
- Approval decision for Japan expected in the first half of 2020
|
|||||
Risdiplam
(RG7916)
|
PTC Therapeutics/ Roche/ SMA Foundation
|
A small molecule medicine that modulates splicing of the SMN2 gene
|
NDA Submitted
|
Oral
|
Prescription Drug User Fee Act, or PDUFA, date set for May 2020
|
(1) |
Taken from public documents including respective company press releases, company presentations, and scientific presentations.
|
Medicine
|
Company
|
Medicine Description (1)
|
Phase (1)
|
Route of Administration (1)
|
Next Milestones (1)
|
|||||
Onpattro
|
Alnylam
|
An RNAi medicine formulated with lipid nanoparticles to inhibit TTR mRNA
|
Approved (hATTR)/
Phase 3 (ATTR)
|
Intravenous infusion with pre-treatment with steroids
|
Topline data for the APOLLO-B (Phase 3 study) is expected in 2021
|
|||||
Vyndaqel &
Vyndamax
(Tafamidis)
|
Pfizer
|
A small molecule medicine to stabilize TTR protein
|
Commercially available in the U.S. for cardiomyopathy and in the EU for stage 1 polyneuropathy and cardiomyopathy
|
Oral
|
None reported
|
|||||
Vutrisiran
|
Alnylam
|
An RNAi medicine conjugated with GalNAC to inhibit TTR mRNA
|
3
|
Subcutaneous Injections
|
Topline data expected for HELIOS-A (Phase 3) study in 2021
|
|||||
AG10
|
Eidos
|
Small molecule that binds and stabilizes TTR in the blood
|
1
|
Oral
|
Phase 3 study planned to begin in the first quarter of 2020
|
(1) |
Taken from public documents including respective company press releases, company presentations, and scientific presentations.
|
Medicine
|
Company
|
Medicine Description (1)
|
Phase (1)
|
Route of Administration (1)
|
Next Milestones (1)
|
|||||
Gemcabene
|
NeuroBo Pharmaceuticals
|
Monocalcium salt of a dialkyl ether dicarboxylic acid
|
2
|
Oral
|
Currently on partial clinical hold, which was issued by the FDA in 2004
|
|||||
Myalept (metreleptin)
|
Amryt Pharma
|
Leptin replacement therapy
|
2
|
Subcutaneous Injections
|
None reported
|
|||||
ARO-APOC3
|
Arrowhead Pharmaceuticals
|
Targets APOCIII by utilizing Targeted RNAi Molecule Platform
|
1
|
Subcutaneous Injections
|
Plans to initiate pivotal (Phase 3) study in 2020
|
(1) |
Taken from public documents including respective company press releases, company presentations, and scientific presentations.
|
C
|
Company
|
Medicine Description (1)
|
Phase (1)
|
Route of Administration (1)
|
Next Milestones (1)
|
|||||
WVE-120101/ WVE-120102
|
Wave Life Sciences
|
Antisense medicines targeting mHTT SNP-1 and SNP-2
|
1b/2a
|
Intrathecal
Infusion
|
Topline data from PRECISION-HD1 is expected in the second half of 2020
|
|||||
Selisistat
|
AOP Orphan
|
An orally active, selective SIRT1 inhibitor
|
2
|
Oral
|
None reported
|
|||||
VX15
|
Vaccinex
|
A monoclonal antibody that blocks the activity of SEMA4D
|
2
|
Intravenous
Infusion
|
Phase 2 (SIGNAL) topline data is anticipated in second half of 2020
|
(1) |
Taken from public documents including respective company press releases, company presentations, and scientific presentations.
|
C
|
Company
|
Medicine Description (1)
|
Phase (1)
|
Route of Administration (1)
|
Next Milestones (1)
|
|||||
Arimoclomol
|
Orphazyme
|
Provides cellular protection from abnormal proteins by activating molecular “chaperone” proteins that can repair or degrade the damaged proteins
|
3
|
Oral
|
Results of the Phase 3 trial in ALS are expected in the first half of 2021
|
(1) |
Taken from public documents including respective company press releases, company presentations, and scientific presentations.
|
Name
|
Age
|
Position
|
||
Stanley T. Crooke, M.D., Ph.D.
|
74
|
Executive Chairman of the Board of Directors
|
||
Brett P. Monia, Ph.D.
|
58
|
Chief Executive Officer
|
||
C. Frank Bennett, Ph.D.
|
63
|
Chief Scientific Officer
|
||
Onaiza Cadoret-Manier
|
55
|
Chief Corporate Development and Commercial Officer
|
||
Richard S. Geary, Ph.D.
|
62
|
Senior Vice President, Development
|
||
Elizabeth L. Hougen
|
58
|
Senior Vice President, Finance and Chief Financial Officer
|
||
Patrick R. O’Neil, Esq.
|
46
|
Senior Vice President, Legal, General Counsel, Chief Compliance Officer and Corporate Secretary
|
||
Eric E. Swayze, Ph.D.
|
54
|
Senior Vice President, Research
|
● |
receipt and scope of marketing authorizations;
|
● |
establishment and demonstration in the medical and patient community of the efficacy and safety of our medicines and their potential advantages over competing products;
|
● |
cost and effectiveness of our medicines compared to other available therapies;
|
● |
patient convenience of the dosing regimen for our medicines; and
|
● |
reimbursement policies of government and third-party payors.
|
● |
priced lower than our medicines;
|
● |
reimbursed more favorably by government and other third-party payors than our medicines;
|
● |
safer than our medicines;
|
● |
more effective than our medicines; or
|
● |
more convenient to use than our medicines.
|
● |
ZOLGENSMA (approved in the U.S. for the treatment of pediatric patients less than two years of age with SMA) and risdiplam (RG7916) could compete with SPINRAZA;
|
● |
ONPATTRO (approved in the U.S., Europe and Brazil for a similar indication as TEGSEDI), VYNDAQEL and VYNDAMAX (approved in the U.S. for patients with both hereditary and wild type ATTR cardiomyopathy and in the EU for stage 1 hATTR amyloidosis with polyneuropathy and cardiomyopathy), AG10 and vutrisiran could compete with TEGSEDI;
|
● |
ARO-APOC3, Myalept and gemcabene could compete with WAYLIVRA;
|
● |
WVE-120101/WVE-120102, Selistat and VX15 could compete with tominersen;
|
● |
Arimoclomol could compete with tofersen; and
|
● |
ONPATTRO, VYNDAQEL and VYNDAMAX, vutrisiran and AG10 could complete with AKCEA-TTR-LRx;.
|
● |
in the U.S., TEGSEDI’s label contains a boxed warning for thrombocytopenia and glomerulonephritis;
|
● |
TEGSEDI requires periodic blood and urine monitoring;
|
● |
in the U.S., TEGSEDI is available only through a Risk Evaluation and Mitigation Strategy, or REMS, program; and
|
● |
we expect WAYLIVRA will require periodic blood monitoring if approved in the U.S.
|
● |
fund our development activities for SPINRAZA;
|
● |
seek and obtain regulatory approvals for SPINRAZA; and
|
● |
successfully commercialize SPINRAZA.
|
● |
such authorities may disagree with the design or implementation of our clinical studies;
|
● |
we or our partners may be unable to demonstrate to the satisfaction of the FDA or other regulatory authorities that a medicine is safe and effective for any indication;
|
● |
such authorities may not accept clinical data from studies conducted at clinical facilities that have deficient clinical practices or that are in countries where the standard of care is potentially different from the United States;
|
● |
we or our partners may be unable to demonstrate that our medicine's clinical and other benefits outweigh its safety risks to support approval;
|
● |
such authorities may disagree with the interpretation of data from preclinical or clinical studies;
|
● |
such authorities may find deficiencies in the manufacturing processes or facilities of third-party manufacturers who manufacture clinical and commercial supplies for our medicines; and
|
● |
the approval policies or regulations of such authorities or their prior guidance to us or our partners during clinical development may significantly change in a manner rendering our clinical data insufficient for approval.
|
● |
the clinical study may produce negative or inconclusive results;
|
● |
regulators may require that we hold, suspend or terminate clinical research for noncompliance with regulatory requirements;
|
● |
we, our partners, the FDA or foreign regulatory authorities could suspend or terminate a clinical study due to adverse side effects of a medicine on subjects in the trial;
|
● |
we, or our partners, may decide, or regulators may require us, to conduct additional preclinical testing or clinical studies;
|
● |
enrollment in our clinical studies may be slower than we anticipate;
|
● |
we or our partners, including our independent clinical investigators, contract research organizations and other third-party service providers on which we rely, may not identify, recruit and train suitable clinical investigators at a sufficient number of study sites or timely enroll a sufficient number of study subjects in the clinical study;
|
● |
the institutional review board for a prospective site might withhold or delay its approval for the study;
|
● |
enrollment in our clinical studies may be slower than we anticipate;
|
● |
people who enroll in the clinical study may later drop out due to adverse events, a perception they are not benefiting from participating in the study, fatigue with the clinical study process or personal issues;
|
● |
a clinical study site may deviate from the protocol for the study;
|
● |
the cost of our clinical studies may be greater than we anticipate;
|
● |
our partners may decide not to exercise any existing options to license and conduct additional clinical studies for our medicines; and
|
● |
the supply or quality of our medicines or other materials necessary to conduct our clinical studies may be insufficient, inadequate or delayed.
|
● |
Roche for development and funding of tominersen;
|
● |
Novartis for development and funding of AKCEA-APO(a)-LRx; and
|
● |
Biogen for development and funding of tofersen.
|
● |
conduct clinical studies;
|
● |
seek and obtain marketing authorization; and
|
● |
manufacture, market and sell our medicines.
|
● |
pursue alternative technologies or develop alternative products that may be competitive with the medicine that is part of the collaboration with us;
|
● |
pursue higher-priority programs or change the focus of its own development programs; or
|
● |
choose to devote fewer resources to our medicines than it does for its own medicines.
|
● |
successful commercialization of SPINRAZA, TEGSEDI and WAYLIVRA;
|
● |
additional marketing approvals for WAYLIVRA and TEGSEDI;
|
● |
the profile and launch timing of our medicines, including TEGSEDI and WAYLIVRA;
|
● |
changes in existing collaborative relationships and our ability to establish and maintain additional collaborative arrangements;
|
● |
continued scientific progress in our research, drug discovery and development programs;
|
● |
the size of our programs and progress with preclinical and clinical studies;
|
● |
the time and costs involved in obtaining marketing authorizations; and
|
● |
competing technological and market developments, including the introduction by others of new therapies that address our markets.
|
● |
interruption of our research, development and manufacturing efforts;
|
● |
injury to our employees and others;
|
● |
environmental damage resulting in costly clean up; and
|
● |
liabilities under federal, state and local laws and regulations governing health and human safety, as well as the use, storage, handling and disposal of these materials and resultant waste products.
|
Property Description
|
Location
|
Square
Footage
|
Owned
or Leased
|
Initial Lease
Term End Date
|
Lease
Extension Options
|
|||||
Ionis laboratory and office space facility
|
Carlsbad, CA
|
176,000
|
Owned
|
|||||||
Ionis manufacturing facility
|
Carlsbad, CA
|
28,700
|
Owned
|
|||||||
Ionis manufacturing support facility
|
Carlsbad, CA
|
25,800
|
Leased
|
2021
|
Two, five-year options to extend
|
|||||
Ionis office space facility
|
Carlsbad, CA
|
5,800
|
Leased
|
2023
|
One, five-year option to extend
|
|||||
Akcea office space facility
|
Boston, MA
|
30,175
|
Leased
|
2028
|
One, five-year option to extend
|
|||||
Akcea office and Ionis storage space facility
|
Carlsbad, CA
|
18,700
|
Leased
|
2023
|
One, five-year option to extend
|
|||||
285,175
|
|
Total
Number of
Shares Purchased
|
Average
Price Paid
Per Share (1)
|
Approximate Dollar Value
of Shares that May Yet Be
Purchased under our Stock
Repurchase Program
|
|||||||||
October 2019
|
-
|
$
|
-
|
$
|
125,000
|
|||||||
November 2019
|
75
|
63.57
|
120,230
|
|||||||||
December 2019
|
460
|
64.40
|
90,593
|
|||||||||
Total
|
535
|
(1) |
Average Price Paid Per Share excludes cash paid for commissions.
|
|
Dec-14
|
Dec-15
|
Dec-16
|
Dec-17
|
Dec-18
|
Dec-19
|
||||||||||||||||||
Ionis Pharmaceuticals, Inc.
|
$
|
100.00
|
$
|
100.31
|
$
|
77.47
|
$
|
81.47
|
$
|
87.56
|
$
|
97.85
|
||||||||||||
Nasdaq Composite Index
|
$
|
100.00
|
$
|
106.96
|
$
|
116.45
|
$
|
150.96
|
$
|
146.67
|
$
|
200.49
|
||||||||||||
Nasdaq Biotechnology Index
|
$
|
100.00
|
$
|
111.77
|
$
|
87.91
|
$
|
106.92
|
$
|
97.45
|
$
|
121.92
|
(1) |
This section is not “soliciting material,” is not deemed “filed” with the SEC, is not subject to the liabilities of Section 18 of the Exchange Act and is not to be incorporated by reference in any of our filings under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.
|
Years Ended December 31,
|
||||||||||||||||||||
2019
|
2018
|
2017
|
2016
|
2015 (1)
|
||||||||||||||||
Consolidated Statement of Operations Data:
|
||||||||||||||||||||
Revenue
|
$
|
1,122.6
|
$
|
599.7
|
$
|
514.2
|
$
|
372.8
|
$
|
283.7
|
||||||||||
Research, development and patent expenses
|
$
|
465.7
|
$
|
414.6
|
$
|
374.6
|
$
|
344.3
|
$
|
322.3
|
||||||||||
Selling, general and administrative expenses
|
$
|
286.6
|
$
|
244.6
|
$
|
108.5
|
$
|
48.6
|
$
|
37.2
|
||||||||||
Net income (loss) attributable to Ionis Pharmaceuticals, Inc. common stockholders
|
$
|
294.1
|
$
|
273.7
|
$
|
0.3
|
$
|
(60.4
|
)
|
$
|
(88.3
|
)
|
||||||||
Basic net income (loss) per share attributable to Ionis Pharmaceuticals, Inc. common stockholders
|
$
|
2.12
|
$
|
2.09
|
$
|
0.15
|
$
|
(0.50
|
)
|
$
|
(0.74
|
)
|
||||||||
Diluted net income (loss) per share attributable to Ionis Pharmaceuticals, Inc. common stockholders
|
$
|
2.08
|
$
|
2.07
|
$
|
0.15
|
$
|
(0.50
|
)
|
$
|
(0.74
|
)
|
||||||||
Shares used in computing basic net income (loss) per share
|
140.0
|
132.3
|
124.0
|
120.9
|
119.7
|
|||||||||||||||
Shares used in computing diluted net income (loss) per share
|
142.9
|
134.1
|
126.1
|
120.9
|
119.7
|
|
As of December 31,
|
|||||||||||||||||||
2019
|
2018
|
2017
|
2016 (1)
|
2015 (1)
|
||||||||||||||||
Consolidated Balance Sheet Data:
|
||||||||||||||||||||
Cash, cash equivalents and short-term investments
|
$
|
2,499.5
|
$
|
2,084.1
|
$
|
1,022.7
|
$
|
665.2
|
$
|
779.2
|
||||||||||
Working capital
|
$
|
2,447.6
|
$
|
1,927.6
|
$
|
925.1
|
$
|
664.1
|
$
|
688.1
|
||||||||||
Total assets
|
$
|
3,233.1
|
$
|
2,667.8
|
$
|
1,322.8
|
$
|
912.5
|
$
|
947.9
|
||||||||||
Long-term debt and other obligations, less current portion
|
$
|
1,275.6
|
$
|
1,200.3
|
$
|
713.9
|
$
|
679.1
|
$
|
598.2
|
||||||||||
Accumulated deficit
|
$
|
(707.5
|
)
|
$
|
(967.3
|
)
|
$
|
(1,241.0
|
)
|
$
|
(1,181.4
|
)
|
$
|
(1,094.9
|
)
|
|||||
Stockholders’ equity
|
$
|
1,684.5
|
$
|
1,187.2
|
$
|
365.3
|
$
|
99.6
|
$
|
200.8
|
(1)
|
We adopted the new revenue recognition accounting standard in 2018 (Topic 606) and adjusted our 2017 results for the adoption. This change is not reflected in our consolidated statement of operations data for 2015 or in our consolidated balance sheet data for 2016 and 2015.
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Total revenue
|
$
|
1,122.6
|
$
|
599.7
|
$
|
514.2
|
||||||
Total operating expenses
|
$
|
756.7
|
$
|
661.0
|
$
|
483.1
|
||||||
Income (loss) from operations
|
$
|
365.9
|
$
|
(61.4
|
)
|
$
|
31.0
|
|||||
Net income (loss)
|
$
|
303.3
|
$
|
215.0
|
$
|
(10.8
|
)
|
|||||
Net income attributable to Ionis Pharmaceuticals, Inc. common stockholders
|
$
|
294.1
|
$
|
273.7
|
$
|
0.3
|
||||||
Cash, cash equivalents and short-term investments
|
$
|
2,499.5
|
$
|
2,084.1
|
$
|
$1,022.7
|
● |
Assessing the propriety of revenue recognition and associated deferred revenue;
|
● |
Determining the appropriate cost estimates for unbilled preclinical studies and clinical development activities;
|
● |
Income taxes; and
|
● |
Estimating the fair value of convertible debt without the conversion feature.
|
● |
Identifying the performance obligations contained in the agreement
|
● |
Determining the transaction price, including any variable consideration
|
● |
Allocating the transaction price to each of our performance obligations
|
● |
If we are performing services, we recognize revenue over our estimated period of performance in a similar manner to the amortization of upfront payments (discussed above under “Amortization of Upfront payments”).
|
● |
Conversely, we recognize in full those milestone payments that we earn based on our partners’ activities when our partner achieves the milestone event and we do not have a performance obligation.
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Revenue:
|
||||||||
Commercial revenue:
|
||||||||
SPINRAZA royalties
|
$
|
292,992
|
$
|
237,930
|
||||
Product sales, net
|
42,253
|
2,237
|
||||||
Licensing and other royalty revenue
|
17,205
|
14,755
|
||||||
Total commercial revenue
|
352,450
|
254,922
|
||||||
R&D revenue:
|
||||||||
Amortization from upfront payments
|
146,246
|
124,695
|
||||||
Milestone payments
|
114,906
|
82,771
|
||||||
License fees
|
489,708
|
102,053
|
||||||
Other services
|
19,289
|
35,233
|
||||||
Total R&D revenue
|
770,149
|
344,752
|
||||||
Total revenue
|
$
|
1,122,599
|
$
|
599,674
|
● |
$246 million we earned from Pfizer when Pfizer licensed AKCEA-ANGPTL3-LRx;
|
● |
$150 million we earned from Novartis when Novartis licensed AKCEA-APO(a)-LRx;
|
● |
$136 million we earned from Biogen for advancing several programs under our collaborations, including adding four targets under our 2018 strategic neurology collaboration;
|
● |
$45 million we earned from Biogen when Biogen licensed IONIS-MAPTRx;
|
● |
$35 million we earned from Roche when Roche enrolled the first patient in the Phase 3 study of tominersen in patients with Huntington's disease;
|
● |
$25 million we earned from GSK when GSK licensed our HBV program; and
|
● |
$20 million we earned from Alnylam when Alnylam licensed our technology to Regeneron.
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Ionis Core
|
$
|
374,014
|
$
|
293,175
|
||||
Akcea Therapeutics
|
450,688
|
251,408
|
||||||
Elimination of intercompany activity
|
(214,560
|
)
|
(14,849
|
)
|
||||
Subtotal
|
610,142
|
529,734
|
||||||
Non-cash compensation expense related to equity awards
|
146,574
|
131,312
|
||||||
Total operating expenses
|
$
|
756,716
|
$
|
661,046
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Ionis Core
|
$
|
—
|
$
|
—
|
||||
Akcea Therapeutics
|
12,820
|
11,573
|
||||||
Elimination of intercompany activity
|
(8,873
|
)
|
(9,913
|
)
|
||||
Subtotal
|
3,947
|
1,660
|
||||||
Non-cash compensation expense related to equity awards
|
437
|
160
|
||||||
Total cost of products sold
|
$
|
4,384
|
$
|
1,820
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Research, development and patent expenses, excluding non-cash compensation expense related to equity awards
|
$
|
370,340
|
$
|
338,047
|
||||
Non-cash compensation expense related to equity awards
|
95,348
|
76,557
|
||||||
Total research, development and patent expenses
|
$
|
465,688
|
$
|
414,604
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Ionis Core
|
$
|
295,071
|
$
|
222,528
|
||||
Akcea Therapeutics
|
280,956
|
120,905
|
||||||
Elimination of intercompany activity
|
(205,687
|
)
|
(5,386
|
)
|
||||
Subtotal
|
370,340
|
338,047
|
||||||
Non-cash compensation expense related to equity awards
|
95,348
|
76,557
|
||||||
Total research, development and patent expenses
|
$
|
465,688
|
$
|
414,604
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Antisense drug discovery expenses, excluding non-cash compensation expense related to equity awards
|
$
|
83,506
|
$
|
61,387
|
||||
Non-cash compensation expense related to equity awards
|
20,913
|
17,530
|
||||||
Total antisense drug discovery expenses
|
$
|
104,419
|
$
|
78,917
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
AKCEA-TTR-LRx
|
$
|
14,061
|
$
|
3,204
|
||||
WAYLIVRA
|
7,435
|
19,397
|
||||||
TEGSEDI
|
16,830
|
19,204
|
||||||
Other antisense development projects
|
94,188
|
98,546
|
||||||
Development overhead expenses
|
74,006
|
63,940
|
||||||
Total antisense drug development, excluding non-cash compensation expense related to equity awards
|
206,520
|
204,291
|
||||||
Non-cash compensation expense related to equity awards
|
45,898
|
34,845
|
||||||
Total antisense drug development expenses
|
$
|
252,418
|
$
|
239,136
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Ionis Core
|
$
|
145,062
|
$
|
100,090
|
||||
Akcea Therapeutics
|
261,458
|
104,201
|
||||||
Elimination of intercompany activity
|
(200,000
|
)
|
—
|
|||||
Subtotal
|
206,520
|
204,291
|
||||||
Non-cash compensation expense related to equity awards
|
45,898
|
34,845
|
||||||
Total antisense drug development expenses
|
$
|
252,418
|
$
|
239,136
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Manufacturing and developmental chemistry expenses, excluding non-cash compensation expense related to equity awards
|
$
|
42,507
|
$
|
39,806
|
||||
Non-cash compensation expense related to equity awards
|
9,569
|
9,036
|
||||||
Total manufacturing and developmental chemistry expenses
|
$
|
52,076
|
$
|
48,842
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Ionis Core
|
$
|
36,847
|
$
|
32,277
|
||||
Akcea Therapeutics
|
11,174
|
12,758
|
||||||
Elimination of intercompany activity
|
(5,515
|
)
|
(5,229
|
)
|
||||
Subtotal
|
42,507
|
39,806
|
||||||
Non-cash compensation expense related to equity awards
|
9,569
|
9,036
|
||||||
Total manufacturing and developmental chemistry expenses
|
$
|
52,076
|
$
|
48,842
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Personnel costs
|
$
|
15,165
|
$
|
12,968
|
||||
Occupancy
|
9,351
|
8,567
|
||||||
Patent expenses
|
4,209
|
2,744
|
||||||
Depreciation and amortization
|
519
|
439
|
||||||
Insurance
|
1,861
|
1,622
|
||||||
Other
|
6,703
|
6,223
|
||||||
Total R&D support expenses, excluding non-cash compensation expense related to equity awards
|
37,808
|
32,563
|
||||||
Non-cash compensation expense related to equity awards
|
18,968
|
15,146
|
||||||
Total R&D support expenses
|
$
|
56,776
|
$
|
47,709
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Ionis Core
|
$
|
29,656
|
$
|
28,774
|
||||
Akcea Therapeutics
|
8,324
|
3,946
|
||||||
Elimination of intercompany activity
|
(172
|
)
|
(157
|
)
|
||||
Subtotal
|
37,808
|
32,563
|
||||||
Non-cash compensation expense related to equity awards
|
18,968
|
15,146
|
||||||
Total R&D support expenses
|
$
|
56,776
|
$
|
47,709
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Selling, general and administrative expenses, excluding non-cash compensation expense related to equity awards
|
$
|
235,856
|
$
|
190,027
|
||||
Non-cash compensation expense related to equity awards
|
50,788
|
54,595
|
||||||
Total selling, general and administrative expenses
|
$
|
286,644
|
$
|
244,622
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Ionis Core
|
$
|
78,943
|
$
|
70,647
|
||||
Akcea Therapeutics
|
156,912
|
118,930
|
||||||
Elimination of intercompany activity
|
—
|
450
|
||||||
Subtotal
|
235,855
|
190,027
|
||||||
Non-cash compensation expense related to equity awards
|
50,789
|
54,595
|
||||||
Total selling general and administrative expenses
|
$
|
286,644
|
$
|
244,622
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Cost of products sold
|
$
|
12,819
|
$
|
11,573
|
||||
Development and patent expenses
|
80,956
|
120,905
|
||||||
Sublicense fees to Ionis
|
200,000
|
—
|
||||||
Selling, general and administrative expenses
|
156,912
|
118,930
|
||||||
Profit (loss) share for TEGSEDI commercialization activities
|
(37,332
|
)
|
—
|
|||||
Total operating expenses, excluding non-cash compensation expense related to equity awards
|
413,355
|
251,408
|
||||||
Non-cash compensation expense related to equity awards
|
37,111
|
44,275
|
||||||
Total Akcea Therapeutics operating expenses
|
$
|
450,466
|
$
|
295,683
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Convertible senior notes:
|
||||||||
Non-cash amortization of the debt discounts and debt issuance costs
|
$
|
39,280
|
$
|
35,173
|
||||
Interest expense payable in cash
|
6,727
|
6,855
|
||||||
Interest on mortgage for primary R&D and manufacturing facilities
|
2,397
|
2,409
|
||||||
Other
|
364
|
352
|
||||||
Total interest expense
|
$
|
48,768
|
$
|
44,789
|
|
Payments Due by Period (in millions)
|
|||||||||||||||||||
Contractual Obligations
(selected balances described below)
|
Total
|
Less than
1 year
|
1-3 years
|
3-5 years
|
After
5 years
|
|||||||||||||||
1% Notes (principal and interest payable)
|
$
|
316.1
|
$
|
3.1
|
$
|
313.0
|
$
|
—
|
$
|
—
|
||||||||||
0.125% Notes (principal and interest payable)
|
$
|
552.3
|
$
|
0.7
|
$
|
1.4
|
$
|
550.2
|
$
|
—
|
||||||||||
Building mortgage payments
|
$
|
78.2
|
$
|
2.4
|
$
|
5.1
|
$
|
6.9
|
$
|
63.8
|
||||||||||
Other obligations (principal and interest payable)
|
$
|
1.0
|
$
|
0.1
|
$
|
0.1
|
$
|
0.1
|
$
|
0.7
|
||||||||||
Operating leases
|
$
|
23.5
|
$
|
3.3
|
$
|
5.8
|
$
|
4.9
|
$
|
9.5
|
||||||||||
Total
|
$
|
971.1
|
$
|
9.6
|
$
|
325.4
|
$
|
562.1
|
$
|
74.0
|
|
0.125% Notes
|
|||
Outstanding principal balance
|
$
|
548.8
|
||
Maturity date
|
December 2024
|
|||
Interest rate
|
0.125 percent
|
|||
Conversion price per share
|
$
|
83.28
|
||
Total shares of common stock subject to conversion
|
6.6
|
|
1% Notes
|
|||
Outstanding principal balance
|
$
|
309.9
|
||
Maturity date
|
November 2021
|
|||
Interest rate
|
1 percent
|
|||
Conversion price per share
|
$
|
66.81
|
||
Total shares of common stock subject to conversion
|
4.6
|
(1)
|
Any information that is included on or linked to our website is not part of this Form 10-K.
|
Plan Category
|
Number of Shares to
be Issued Upon Exercise
of Outstanding Options
|
Weighted Average
Exercise Price of
Outstanding Options
|
Number of Shares
Remaining Available
for Future Issuance
|
|||||
Equity compensation plans approved by stockholders (a)
|
11,001,241
|
$
|
51.48
|
8,335,635
|
(b)
|
|||
Total
|
11,001,241
|
$
|
51.48
|
8,335,635
|
(a) |
Consists of four Ionis plans: 1989 Stock Option Plan, Amended and Restated 2002 Non-Employee Directors’ Stock Option Plan, 2011 Equity Incentive Plan and Employee Stock Purchase Plan, or ESPP.
|
(b) |
Of these shares, 725,930 remained available for purchase under the ESPP as of December 31, 2019.
|
Exhibit Number
|
Description of Document
|
|
3.1
|
Amended and Restated Certificate of Incorporation filed June 19, 1991, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2017 and incorporated herein by reference.
|
|
3.2
|
Certificate of Amendment to Restated Certificate of Incorporation, filed June 17, 2014. - Filed as an exhibit to the Registrant’s Notice of Annual Meeting and Proxy Statement, for the 2014 Annual Meeting of Stockholders, filed with the SEC on April 25, 2014, and incorporated herein by reference.
|
|
3.3
|
Certificate of Amendment to Restated Certificate of Incorporation, filed December 18, 2015. - Filed as an exhibit to the Registrant’s Current Report on Form 8-K filed December 18, 2015 and incorporated herein by reference.
|
|
3.4
|
Amended and Restated Bylaws, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed December 18, 2015 and incorporated herein by reference.
|
|
4.1
|
Certificate of Designation of the Series C Junior Participating Preferred Stock, filed as an exhibit to Registrant’s Report on Form 8-K filed December 13, 2000 and incorporated herein by reference.
|
|
4.2
|
Specimen Common Stock Certificate, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2017 and incorporated herein by reference.
|
|
4.3
|
Indenture, dated as of August 13, 2012, between the Registrant and Wells Fargo Bank, National Association, as trustee, including Form of 2¾ percent Convertible Senior Note due 2019, filed as an exhibit to the Registrant’s Report on Form 8-K filed August 13, 2012 and incorporated herein by reference.
|
|
4.4
|
Indenture, dated as of November 17, 2014, between the Registrant and Wells Fargo Bank, National Association, as trustee, including Form of 1.00 percent Convertible Senior Note due 2021, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed November 21, 2014 and incorporated herein by reference.
|
|
4.5
|
Indenture, dated as of December 19, 2019, by and between Ionis Pharmaceuticals, Inc. and U.S. Bank National Association, as trustee, including Form of 0.125 percent Convertible Senior Note due 2024, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed December 23, 2019 and incorporated herein by reference.
|
|
4.6
|
Form of Exchange and/or Subscription Agreement for Ionis Pharmaceuticals, Inc. Convertible Senior Notes due 2024, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed December 12, 2019 and incorporated herein by reference.
|
|
4.7
|
Form of Convertible Note Hedge Transactions Confirmation, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed December 12, 2019 and incorporated herein by reference.
|
|
4.8
|
Form of Warrant Transactions Confirmation, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed December 12, 2019 and incorporated herein by reference.
|
|
Description of the Registrant’s Securities.
|
||
10.1
|
Form of Indemnity Agreement entered into between the Registrant and its Directors and Officers with related schedule, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012 and incorporated herein by reference.
|
|
10.2*
|
Registrant’s 1989 Stock Option Plan, as amended, filed as an exhibit to Registrant’s Notice of Annual Meeting and Proxy Statement for the 2012 Annual Meeting of Stockholders, filed with the SEC on April 16, 2012, and incorporated herein by reference.
|
|
10.3*
|
Registrant’s Amended and Restated 2000 Employee Stock Purchase Plan, filed as an exhibit to Registrant’s Current Report on Form8-K filed with the SEC on March 26, 2019, and incorporated herein by reference.
|
|
10.4
|
Form of Employee Confidential Information and Inventions Agreement, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2017 and incorporated herein by reference.
|
10.5
|
Collaboration and License Agreement between the Registrant and Hybridon, Inc., dated May 24, 2001, filed as an exhibit to the Registrant’s report on Form 10-Q as amended for the quarter ended June 30, 2001 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.6
|
Amendment #1 to the Research, Development and License Agreement dated May 11, 2011 by and between the Registrant and Glaxo Group Limited, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2011 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.7
|
Amended and Restated Collaboration and License Agreement between the Registrant and Antisense Therapeutics Ltd dated February 8, 2008, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2008 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.8
|
Stock Purchase Agreement among the Registrant, Akcea Therapeutics, Inc. and Novartis Pharma AG dated January 5, 2017, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017 and incorporated herein by reference.
|
|
10.9
|
Amendment #1 between the Registrant and Bayer AG dated February 10, 2017, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.10
|
Registrant’s Amended and Restated 10b5-1 Trading Plan dated September 12, 2013, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2013 and incorporated herein by reference.
|
|
10.11*
|
Registrant’s Amended and Restated 2002 Non-Employee Directors’ Stock Option Plan, as amended, filed as an exhibit to the Registrant’s Notice of Annual Meeting and Proxy Statement, for the 2014 Annual Meeting of Stockholders, filed with the SEC on April 25, 2014, and incorporated herein by reference.
|
10.12*
|
Form of Restricted Stock Unit Agreement for Restricted Stock Units granted under the Ionis Pharmaceuticals, Inc. Amended and Restated 2002 Non-Employee Directors’ Stock Option Plan, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 and incorporated herein by reference.
|
|
10.13
|
Research Collaboration, Option and License Agreement between the Registrant and Biogen MA Inc. dated December 19, 2017, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2017 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.14*
|
Amended and Restated Ionis Pharmaceuticals, Inc. 2011 Equity Incentive Plan, filed as an exhibit to the Registrant’s Notice of 2019 Annual Meeting of Stockholders and Proxy Statement filed with the SEC on April 26, 2019, and incorporated herein by reference.
|
|
10.15*
|
Form of Option Agreement under the 2011 Equity Incentive Plan, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2015 and incorporated herein by reference.
|
|
10.16*
|
Form of Time-Vested Restricted Stock Unit Agreement for Restricted Stock Units granted under the 2011 Equity Incentive Plan, filed as an exhibit to the Registrant’s Registration Statement on Form S-8 filed with the SEC on August 8, 2011, and incorporated herein by reference.
|
|
10.17
|
Loan Agreement between Ionis Gazelle, LLC and UBS AG dated July 18, 2017, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed July 21, 2017 and incorporated herein by reference.
|
|
10.18*
|
Form of Option Agreement under the 1989 Stock Option Plan, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2015 and incorporated herein by reference.
|
|
10.19*
|
Form of Option Agreement for Options Granted after March 8, 2005 under the 2002 Non-Employee Director’s Stock Option Plan, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2004 and incorporated herein by reference.
|
10.20
|
Research, Development and License Agreement between the Registrant and Glaxo Group Limited dated March 30, 2010, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2010 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.21
|
Loan Agreement between Ionis Faraday, LLC and UBS AG dated July 18, 2017, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed July 21, 2017 and incorporated herein by reference.
|
|
10.22
|
Research Agreement dated August 10, 2011 between the Registrant and CHDI Foundation, Inc, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2011 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.23
|
Guaranty between the Registrant and UBS AG dated July 18, 2017, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed July 21, 2017 and incorporated herein by reference.
|
|
10.24
|
Development, Option and License Agreement between the Registrant and Biogen Idec International Holding Ltd. dated January 3, 2012, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.25
|
DMPK Research, Development, Option and License Agreement between the Registrant and Biogen Idec MA Inc. dated June 27, 2012, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.26
|
Amendment #2 to Research, Development and License Agreement between the Registrant and Glaxo Group Limited dated October 30, 2012, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.27
|
Collaboration, License and Development Agreement between the Registrant and AstraZeneca AB dated December 7, 2012, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
10.28
|
Neurology Drug Discovery and Development Collaboration, Option and License Agreement between the Registrant and Biogen Idec MA Inc. dated December 10, 2012, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.29
|
HTT Research, Development, Option and License Agreement among the Registrant, F. Hoffmann-La Roche Ltd and Hoffman-La Roche Inc. dated April 8, 2013, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2013 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.30
|
Letter Agreement between the Registrant and CHDI Foundation, Inc. dated April 8, 2013, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2013 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.31
|
Amendment #1 to Collaboration, License and Development Agreement between the Registrant and AstraZeneca AB dated August 13, 2013, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2013 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.32
|
Letter Agreement Amendment between the Registrant and Biogen Idec International Holding Ltd dated January 27, 2014, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
10.33
|
Amendment No. 3 to the Research, Development and License Agreement between the Registrant and Glaxo Group Limited dated July 10, 2013, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.34
|
Amendment #4 to the Research, Development and License Agreement between the Registrant and Glaxo Group Limited dated April 10, 2014, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.35
|
Amendment #5 to the Research, Development and License Agreement among the Registrant, Glaxo Group Limited and GlaxoSmithKline Intellectual Property Development Limited dated June 27, 2014, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.36
|
Exclusive License Agreement between the Registrant and the University of Massachusetts dated January 14, 2010, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.37
|
Amended and Restated Collaboration and License Agreement between the Registrant and Cold Spring Harbor Laboratory dated October 26, 2011, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.38
|
Amendment to Amended and Restated Collaboration and License Agreement between the Registrant and Cold Spring Harbor Laboratory dated March 14, 2014, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.39
|
Amendment #1 to the Development, Option and License Agreement between the Registrant and Biogen Idec International Holding Ltd. dated December 15, 2014, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2014 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.40
|
Research Collaboration, Option and License Agreement between the Registrant and Janssen Biotech Inc. dated December 22, 2014, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2014 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.41
|
Amendment No.2 to the Collaboration, License and Development Agreement between the Registrant and AstraZeneca AB dated October 15, 2014, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2014 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.42
|
Strategic Collaboration Agreement between the Registrant and AstraZeneca AB dated July 31, 2015, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2015 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.43
|
Amendment #6 to Research, Development and License Agreement between the Registrant, Glaxo Group Limited and GlaxoSmithKline Intellectual Property Development Limited dated September 2, 2015, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2015 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.44
|
Amendment Number One to the Second Amended and Restated Strategic Collaboration and License Agreement between the Registrant and Alnylam Pharmaceuticals, Inc. dated July 13, 2015, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2015 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
10.45
|
License Agreement between the Registrant and Bayer Pharma AG dated May 1, 2015. Portions of this exhibit have been omitted and separately filed with the SEC, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2015 and incorporated herein by reference.
|
|
10.46
|
Second Amended and Restated Strategic Collaboration and License Agreement between the Registrant and Alnylam Pharmaceuticals, Inc. dated January 8, 2015, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.47
|
Amendment #1 to HTT Research, Development, Option and License Agreement between the Registrant, F. Hoffmann-La Roche Ltd and Hoffmann-La Roche Inc. dated January 9, 2015, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.48
|
Amendment No.3 to the Collaboration, License and Development Agreement between the Registrant and AstraZeneca AB dated January 18, 2016, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.49
|
Amendment #7 to the Research, Development and License Agreement among the Registrant, Glaxo Group Limited and GlaxoSmithKline Intellectual Property Development Limited dated March 4, 2016, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.50
|
First Amendment to Research Collaboration, Option and License Agreement between the Registrant and Janssen Biotech Inc. dated December 21, 2016, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2016 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.51
|
Letter Agreement between the Registrant and Biogen MA Inc. dated October 28, 2016, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2016 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.52
|
Guaranty between the Registrant and UBS AG dated July 18, 2017, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed July 21, 2017 and incorporated herein by reference.
|
|
10.53
|
Environmental Indemnity Agreement among the Registrant, Ionis Gazelle, LLC and UBS AG dated July 18, 2017, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed July 21, 2017 and incorporated herein by reference.
|
|
10.54
|
Environmental Indemnity Agreement among the Registrant, Ionis Faraday, LLC and UBS AG dated July 18, 2017, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed July 21, 2017 and incorporated herein by reference.
|
|
10.55*
|
Registrant’s Severance Benefit Plan and Summary Plan Description dated October 18, 2018, - filed as an exhibit to the Registrant’s Current Report on form 8-K filed October 18, 2018 and incorporated herein by reference.
|
|
10.56
|
Second Amended and Restated Strategic Advisory Services Agreement by and between the Registrant and B. Lynne Parshall, dated January 9, 2020, filed as an exhibit to the Registrant’s Current Report on Form 8-K filed January 10, 2020 and incorporated herein by reference.
|
|
10.57
|
Development, Commercialization, Collaboration, and License Agreement by and between the Registrant and Akcea Therapeutics, Inc., dated March 14, 2018, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2018 and incorporated herein by reference.
|
|
10.58
|
Amended and Restated Services Agreement by and between the Registrant and Akcea Therapeutics, Inc., dated March 14, 2018, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2018 and incorporated herein by reference.
|
|
10.59
|
New Strategic Neurology Drug Discovery and Development Collaboration, Option and License Agreement by and between the Registrant and Biogen MA Inc., dated April 19, 2018, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
10.60
|
Stock Purchase Agreement by and between the Registrant and Biogen MA Inc., dated April 19, 2018, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 and incorporated herein by reference.
|
|
10.61
|
Second Amendment to Research, Collaboration, Option and License Agreement by and between the Registrant and Janssen Biotech Inc., dated August 7, 2018, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2018 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.62
|
Factor B Development Collaboration, Option and License Agreement by and between the Registrant, F. Hoffmann-La Roche Ltd and Hoffmann-La Roche Inc., dated October 9, 2018, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018 and incorporated herein by reference. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.63
|
Second Amended and Restated Strategic Neurology Drug Discovery and Development Collaboration, Option and License Agreement by and between the Registrant and Biogen MA Inc., dated October 17, 2018, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.64
|
Amendment #1 to the Strategic Collaboration Agreement by and between the Registrant and AstraZeneca AB, dated October 18, 2018, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.65
|
Amendment #4 to the Collaboration, License and Development Agreement by and between the Registrant and AstraZeneca AB, dated October 18, 2018, filed as an exhibit to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018. Portions of this exhibit have been omitted and separately filed with the SEC with a request for confidential treatment.
|
|
10.66
|
Amendment #1 to Second Amended and Restated Strategic Neurology Drug Discovery and Development Collaboration, Option and License Agreement by and between the Registrant and Biogen MA Inc., dated May 2, 2019, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.
|
|
10.67
|
Amendment #1 to the New Strategic Neurology Drug Discovery and Development Collaboration, Option and License Agreement between the Registrant and Biogen MA Inc., dated August 16, 2019, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019. Portions of this exhibit have been omitted because they are both (i) not material and (ii) would be competitively harmful if publicly disclosed.
|
|
10.68
|
Amendment #8 to the Research, Development and License Agreement between the Registrant, Glaxo Group Limited and Glaxosmithkline Intellectual Property Development Limited, dated July 29, 2019, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019. Portions of this exhibit have been omitted because they are both (i) not material and (ii) would be competitively harmful if publicly disclosed.
|
|
10.69
|
Consent to Collateral Addition and Amendment to Loan Documents between the Registrant, Ionis Gazelle, LLC, Wells Fargo Bank, National Association, as Trustee for the Benefit of the Registered Holders of UBS Commercial Mortgage Trust 2017-C3, Commercial Mortgage Pass-Through Certificates, Series 2017-C3, dated August 1, 2019, filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019.
|
|
Letter Agreement between the Registrant, Akcea Therapeutics, Inc., and Pfizer Inc., dated October 4, 2019. Portions of this exhibit have been omitted because they are both (i) not material and (ii) would be competitively harmful if publicly disclosed.
|
||
List of Subsidiaries for the Registrant.
|
||
Consent of Independent Registered Public Accounting Firm.
|
||
24.1
|
Power of Attorney – Included on the signature page of this Annual Report on Form 10-K.
|
|
Certification by Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
Certification by Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
||
32.1+
|
Certification Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101
|
The following financial statements from the Ionis Pharmaceuticals, Inc. Annual Report on Form 10-K for the year ended December 31, 2019, formatted in Extensive Business Reporting Language (XBRL): (i) consolidated balance sheets, (ii) consolidated statements of operations, (iii) consolidated statements of comprehensive income (loss), (iv) consolidated statements of stockholders’ equity (v) consolidated statements of cash flows, and (vi) notes to consolidated financial statements (detail tagged)
|
|
104
|
Cover Page Interactive Data File (formatted in iXBRL and included in exhibit 101)
|
* |
Indicates management compensatory plans and arrangements as required to be filed as exhibits to this Report pursuant to Item 14(c).
|
+ |
This certification is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 133, as amended, or the Securities Exchange Act of 1934, as amended.
|
IONIS PHARMACEUTICALS, INC.
|
||
By:
|
/s/ BRETT P. MONIA
|
|
Brett P. Monia., Ph.D.
|
||
Chief Executive Officer (Principal executive officer)
|
Signatures
|
Title
|
Date
|
||
/s/ BRETT P. MONIA
|
Director and Chief Executive Officer
|
March 2, 2020
|
||
Brett P. MONIA, Ph.D.
|
(Principal executive officer)
|
|||
/s/ ELIZABETH L. HOUGEN
|
Senior Vice President, Finance and Chief Financial Officer
|
March 2, 2020
|
||
Elizabeth L. Hougen
|
(Principal financial and accounting officer)
|
|||
/s/ STANLEY T. CROOKE
|
Executive Chairman of the Board
|
March 2, 2020
|
||
Stanley T. Crooke, M.D., Ph.D.
|
||||
/s/ B. LYNNE PARSHALL
|
Director and Senior Strategic Advisor
|
March 2, 2020
|
||
B. Lynne Parshall, J.D.
|
||||
/s/ SPENCER R. BERTHELSEN
|
Director
|
March 2, 2020
|
||
Spencer R. Berthelsen, M.D.
|
||||
/s/ BREAUX CASTLEMAN
|
Director
|
March 2, 2020
|
||
Breaux Castleman
|
||||
/s/ MICHAEL HAYDEN
|
Director
|
March 2, 2020
|
||
Michael Hayden, CM OBC MB ChB PhD FRCP(C) FRSC
|
||||
/s/ JOAN E. HERMAN
|
Director
|
March 2, 2020
|
||
Joan E. Herman
|
||||
/s/ JOSEPH KLEIN
|
Director
|
March 2, 2020
|
||
Joseph Klein, III
|
||||
/s/ JOSEPH LOSCALZO
|
Director
|
March 2, 2020
|
||
Joseph Loscalzo, M.D., Ph.D.
|
||||
/s/ FREDERICK T. MUTO
|
Director
|
March 2, 2020
|
||
Frederick T. Muto, Esq.
|
||||
/s/ PETER N. REIKES
|
Director
|
March 2, 2020
|
||
Peter N. Reikes
|
||||
/s/ JOSEPH H. WENDER
|
Director
|
March 2, 2020
|
||
Joseph H. Wender
|
|
Page
|
Report of Independent Registered Public Accounting Firm
|
F-2
|
Consolidated Balance Sheets at December 31, 2019 and 2018
|
F-4
|
Consolidated Statements of Operations for the years ended December 31, 2019, 2018 and 2017
|
F-5
|
Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2019, 2018 and 2017
|
F-6
|
Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2019, 2018 and 2017
|
F-7
|
Consolidated Statements of Cash Flows for the years ended December 31, 2019, 2018 and 2017
|
F-8
|
Notes to Consolidated Financial Statements
|
F-10
|
Revenue recognition for collaboration agreements
|
||
Description of the Matter
|
For the year ended December 31, 2019, the Company’s reported research and development revenue under collaborative agreements was $770.1 million. As discussed in Note 1 to the consolidated financial statements, the Company enters into collaboration agreements that are often comprised of multiple performance obligations, including technology licenses or options to obtain technology licenses, research and development services, and manufacturing services.
Auditing the Company’s revenue recognition for collaboration agreements is complex because significant judgment may be required to apply the authoritative accounting guidance at the outset of the arrangement, including the determination of performance obligations and transaction price, as well as the allocation of the transaction price among the performance obligations. For example, the allocation of the transaction price among the performance obligations involves the estimation of the standalone selling price of each performance obligation which is based upon various assumptions, which may include projected income, estimated costs and discount rate.
|
|
How We Addressed the Matter in Our Audit
|
We evaluated and tested the design and operating effectiveness of key controls over the risks of material misstatement relating to the accounting for revenue recognition of collaboration agreements with multiple performance obligations. For example, we tested management’s controls over the allocation of the transaction price, particularly the review of the methodology and assumptions used in the valuation of standalone selling price mentioned above.
Our audit procedures included, among others, evaluating the Company’s assessment of the authoritative guidance to its contracts, inspecting contracts entered into during the period, and evaluating management’s interpretation of certain contract provisions when identifying performance obligations and allocating the transaction price to the performance obligations. We also evaluated the Company’s key assumptions and judgments and tested the completeness and accuracy of the underlying data used to determine the standalone selling price of each performance obligation. In addition, we compared the significant assumptions mentioned above to current industry and market trends and performed sensitivity analyses to evaluate the changes to revenue recognized that would result from changes in the assumptions.
|
|
Realizability of Deferred Tax Assets
|
||
Description of the Matter
|
As discussed in Note 1 to the consolidated financial statements, the Company records a valuation allowance based on the assessment of the realizability of the Company’s deferred tax assets. Deferred tax assets are reduced by a valuation allowance if, based on the weight of all available evidence, in management’s judgment it is more likely than not that some portion, or all, of the deferred tax assets will not be realized. For the year ended December 31, 2019, the Company had gross deferred tax assets of $514.5 million and a related valuation allowance of $197.0 million as described in Note 5.
Auditing management’s assessment of the realizability of its deferred tax assets involved significant judgment because the assessment process is complex and is based upon assumptions that may be affected by future market or economic conditions.
|
|
How We Addressed the Matter in Our Audit
|
We evaluated and tested the design and operating effectiveness of controls over the Company’s income tax process, including controls over management’s scheduling of the future reversal of existing taxable temporary differences, identification and use of available tax planning strategies and projections of future taxable income.
Among other audit procedures performed, we evaluated the assumptions used by the Company to develop the scheduling of the future reversal of existing taxable temporary differences, tax planning strategies, as well as current earnings and anticipated future earnings used in the Company’s analysis in determining the valuation allowance on a jurisdiction by jurisdiction basis. We tested the completeness and accuracy of the underlying data used in the Company’s projections. For example, we compared management’s forecasts to actual results for the current and historical periods. Furthermore, we evaluated the appropriateness of the assumptions underlying the future projected financial information, as well as management’s consideration of current operating, industry and economic trends. We also compared the projections of future taxable income with other forecasted financial information prepared by the Company. In addition, we involved our tax specialists to evaluate the application of tax law in the projections of future taxable income.
|
|
December 31,
|
|||||||
2019
|
2018
|
|||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
683,287
|
$
|
278,820
|
||||
Short-term investments
|
1,816,257
|
1,805,252
|
||||||
Contracts receivable
|
63,034
|
12,759
|
||||||
Inventories
|
18,180
|
8,582
|
||||||
Other current assets
|
139,839
|
102,473
|
||||||
Total current assets
|
2,720,597
|
2,207,886
|
||||||
Property, plant and equipment, net
|
153,651
|
132,160
|
||||||
Patents, net
|
25,674
|
24,032
|
||||||
Long-term deferred tax assets
|
305,557
|
290,796
|
||||||
Deposits and other assets
|
27,633
|
12,910
|
||||||
Total assets
|
$
|
3,233,112
|
$
|
2,667,784
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
16,067
|
$
|
28,660
|
||||
Accrued compensation
|
37,357
|
29,268
|
||||||
Accrued liabilities
|
66,769
|
47,503
|
||||||
Income taxes payable
|
32,514
|
858
|
||||||
Current portion of long-term obligations
|
2,026
|
13,749
|
||||||
Current portion of deferred contract revenue
|
118,272
|
160,256
|
||||||
Total current liabilities
|
273,005
|
280,294
|
||||||
Long-term deferred contract revenue
|
490,060
|
567,359
|
||||||
0.125 percent convertible senior notes
|
434,711
|
—
|
||||||
1 percent convertible senior notes
|
275,333
|
568,215
|
||||||
Long-term obligations, less current portion
|
15,543
|
4,914
|
||||||
Long-term mortgage debt
|
59,913
|
59,842
|
||||||
Total liabilities
|
1,548,565
|
1,480,624
|
||||||
Stockholders’ equity:
|
||||||||
Common stock, $0.001 par value; 300,000,000 shares authorized, 140,339,615 and 137,928,828 shares issued and outstanding at December 31, 2019 and December 31, 2018, respectively
|
140
|
138
|
||||||
Additional paid-in capital
|
2,203,778
|
2,047,250
|
||||||
Accumulated other comprehensive loss
|
(25,290
|
)
|
(32,016
|
)
|
||||
Accumulated deficit
|
(707,534
|
)
|
(967,293
|
)
|
||||
Total Ionis stockholders’ equity
|
1,471,094
|
1,048,079
|
||||||
Noncontrolling interest in Akcea Therapeutics, Inc.
|
213,453
|
139,081
|
||||||
Total stockholders’ equity
|
1,684,547
|
1,187,160
|
||||||
Total liabilities and stockholders’ equity
|
$
|
3,233,112
|
$
|
2,667,784
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Revenue:
|
||||||||||||
Commercial revenue:
|
||||||||||||
SPINRAZA royalties
|
$
|
292,992
|
$
|
237,930
|
$
|
112,540
|
||||||
Product sales, net
|
42,253
|
2,237
|
—
|
|||||||||
Licensing and other royalty revenue
|
17,205
|
14,755
|
7,474
|
|||||||||
Total commercial revenue
|
352,450
|
254,922
|
120,014
|
|||||||||
Research and development revenue under collaborative agreements
|
770,149
|
344,752
|
394,165
|
|||||||||
Total revenue
|
1,122,599
|
599,674
|
514,179
|
|||||||||
Expenses:
|
||||||||||||
Cost of products sold
|
4,384
|
1,820
|
—
|
|||||||||
Research, development and patent
|
465,688
|
414,604
|
374,644
|
|||||||||
Selling, general and administrative
|
286,644
|
244,622
|
108,488
|
|||||||||
Total operating expenses
|
756,716
|
661,046
|
483,132
|
|||||||||
Income (loss) from operations
|
365,883
|
(61,372
|
)
|
31,047
|
||||||||
Other income (expense):
|
||||||||||||
Investment income
|
52,205
|
30,187
|
8,179
|
|||||||||
Interest expense
|
(48,768
|
)
|
(44,789
|
)
|
(44,752
|
)
|
||||||
Loss on extinguishment of financing liability for leased facility
|
—
|
—
|
(7,689
|
)
|
||||||||
Loss on early retirement of debt
|
(21,865
|
)
|
—
|
—
|
||||||||
Other expenses
|
(686
|
)
|
(182
|
)
|
(3,548
|
)
|
||||||
Income (loss) before income tax benefit (expense)
|
346,769
|
(76,156
|
)
|
(16,763
|
)
|
|||||||
Income tax benefit (expense)
|
(43,507
|
)
|
291,141
|
5,980
|
||||||||
Net income (loss)
|
303,262
|
214,985
|
(10,783
|
)
|
||||||||
Net (income) loss attributable to noncontrolling interest in Akcea Therapeutics, Inc.
|
(9,116
|
)
|
58,756
|
11,129
|
||||||||
Net income attributable to Ionis Pharmaceuticals, Inc. common stockholders
|
$
|
294,146
|
$
|
273,741
|
$
|
346
|
||||||
Basic net income per share
|
$
|
2.12
|
$
|
2.09
|
$
|
0.15
|
||||||
Shares used in computing basic net income per share
|
139,998
|
132,320
|
124,016
|
|||||||||
Diluted net income per share
|
$
|
2.08
|
$
|
2.07
|
$
|
0.15
|
||||||
Shares used in computing diluted net income per share
|
142,872
|
134,056
|
126,098
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Net income (loss)
|
$
|
303,262
|
$
|
214,985
|
$
|
(10,783
|
)
|
|||||
Unrealized gains (losses) on investments, net of tax
|
6,633
|
(280
|
)
|
(960
|
)
|
|||||||
Reclassification adjustment for realized gains included in net income (loss)
|
—
|
—
|
(374
|
)
|
||||||||
Currency translation adjustment
|
93
|
23
|
(67
|
)
|
||||||||
Comprehensive income (loss)
|
309,988
|
214,728
|
(12,184
|
)
|
||||||||
Comprehensive income (loss) attributable to noncontrolling interest in Akcea Therapeutics, Inc.
|
9,118
|
(58,781
|
)
|
(11,224
|
)
|
|||||||
Comprehensive income (loss) attributable to Ionis Pharmaceuticals, Inc. common stockholders
|
$
|
300,870
|
$
|
273,509
|
$
|
(960
|
)
|
|
Common Stock
|
Additional
|
Accumulated Other
|
Accumulated
|
Total Ionis
Stockholders’
|
Noncontrolling
Interest in Akcea
|
Total
Stockholders’
|
|||||||||||||||||||||||||
Description
|
Shares
|
Amount
|
Paid in Capital
|
Comprehensive Loss
|
Deficit
|
Equity
|
Therapeutics, Inc.
|
Equity
|
||||||||||||||||||||||||
Balance at December 31, 2016
|
121,636
|
$
|
122
|
$
|
1,311,229
|
$
|
(30,358
|
)
|
$
|
(1,241,380
|
)
|
$
|
39,613
|
$
|
—
|
$
|
39,613
|
|||||||||||||||
Net income
|
—
|
—
|
—
|
—
|
346
|
346
|
—
|
346
|
||||||||||||||||||||||||
Change in unrealized gains, net of tax
|
—
|
—
|
—
|
(1,334
|
)
|
—
|
(1,334
|
)
|
—
|
(1,334
|
)
|
|||||||||||||||||||||
Foreign currency translation
|
—
|
—
|
—
|
(67
|
)
|
—
|
(67
|
)
|
—
|
(67
|
)
|
|||||||||||||||||||||
Novartis stock purchase
|
1,631
|
2
|
71,737
|
—
|
—
|
71,739
|
—
|
71,739
|
||||||||||||||||||||||||
Issuance of common stock in connection with employee stock plans
|
1,709
|
1
|
22,931
|
—
|
—
|
22,932
|
—
|
22,932
|
||||||||||||||||||||||||
Stock-based compensation expense
|
—
|
—
|
85,975
|
—
|
—
|
85,975
|
—
|
85,975
|
||||||||||||||||||||||||
Issuance of Akcea Therapeutics, Inc. common stock in conjunction with initial public offering
|
—
|
—
|
157,270
|
—
|
—
|
157,270
|
—
|
157,270
|
||||||||||||||||||||||||
Noncontrolling interest in Akcea Therapeutics, Inc. in conjunction with initial public offering
|
—
|
—
|
(90,351
|
)
|
—
|
—
|
(90,351
|
)
|
90,381
|
30
|
||||||||||||||||||||||
Noncontrolling interest in Akcea Therapeutics, Inc.
|
—
|
—
|
(5,110
|
)
|
—
|
—
|
(5,110
|
)
|
(6,114
|
)
|
(11,224
|
)
|
||||||||||||||||||||
Balance at December 31, 2017
|
124,976
|
$
|
125
|
$
|
1,553,681
|
$
|
(31,759
|
)
|
$
|
(1,241,034
|
)
|
$
|
281,013
|
$
|
84,267
|
$
|
365,280
|
|||||||||||||||
Net income
|
—
|
—
|
—
|
—
|
273,741
|
273,741
|
—
|
273,741
|
||||||||||||||||||||||||
Change in unrealized losses, net of tax
|
—
|
—
|
—
|
(280
|
)
|
—
|
(280
|
)
|
—
|
(280
|
)
|
|||||||||||||||||||||
Foreign currency translation
|
—
|
—
|
—
|
23
|
—
|
23
|
—
|
23
|
||||||||||||||||||||||||
Biogen stock purchase
|
11,502
|
11
|
447,954
|
—
|
—
|
447,965
|
—
|
447,965
|
||||||||||||||||||||||||
Issuance of common stock in connection with employee stock plans
|
1,451
|
2
|
27,898
|
—
|
—
|
27,900
|
—
|
27,900
|
||||||||||||||||||||||||
Stock-based compensation expense
|
—
|
—
|
131,312
|
—
|
—
|
131,312
|
—
|
131,312
|
||||||||||||||||||||||||
Noncontrolling interest in Akcea Therapeutics, Inc.
|
—
|
—
|
(113,595
|
)
|
—
|
—
|
(113,595
|
)
|
54,814
|
(58,781
|
)
|
|||||||||||||||||||||
Balance at December 31, 2018
|
137,929
|
$
|
138
|
$
|
2,047,250
|
$
|
(32,016
|
)
|
$
|
(967,293
|
)
|
$
|
1,048,079
|
$
|
139,081
|
$
|
1,187,160
|
|||||||||||||||
Net income
|
—
|
—
|
—
|
—
|
294,146
|
294,146
|
—
|
294,146
|
||||||||||||||||||||||||
Change in unrealized gains, net of tax
|
—
|
—
|
—
|
6,633
|
—
|
6,633
|
—
|
6,633
|
||||||||||||||||||||||||
Foreign currency translation
|
—
|
—
|
—
|
93
|
—
|
93
|
—
|
93
|
||||||||||||||||||||||||
Issuance of common stock in connection with employee stock plans
|
3,100
|
3
|
119,654
|
—
|
—
|
119,657
|
—
|
119,657
|
||||||||||||||||||||||||
1 percent convertible senior notes retirement, equity portion, net of tax
|
—
|
—
|
(77,331
|
)
|
—
|
—
|
(77,331
|
)
|
—
|
(77,331
|
)
|
|||||||||||||||||||||
0.125 percent convertible senior notes, equity portion, net of issuance costs and tax
|
—
|
—
|
81,877
|
—
|
—
|
81,877
|
—
|
81,877
|
||||||||||||||||||||||||
Issuance of warrants
|
—
|
—
|
56,110
|
—
|
—
|
56,110
|
—
|
56,110
|
||||||||||||||||||||||||
Purchase of note hedges, net of tax
|
—
|
—
|
(85,860
|
)
|
—
|
—
|
(85,860
|
)
|
—
|
(85,860
|
)
|
|||||||||||||||||||||
Repurchases and retirements of common stock
|
(535
|
)
|
(1
|
)
|
—
|
—
|
(34,387
|
)
|
(34,388
|
)
|
—
|
(34,388
|
)
|
|||||||||||||||||||
Stock-based compensation expense
|
—
|
—
|
146,574
|
—
|
—
|
146,574
|
—
|
146,574
|
||||||||||||||||||||||||
Payments of tax withholdings related to vesting of employee stock awards and exercise of employee stock options
|
(154
|
)
|
—
|
(19,242
|
)
|
—
|
—
|
(19,242
|
)
|
—
|
(19,242
|
)
|
||||||||||||||||||||
Noncontrolling interest in Akcea Therapeutics, Inc.
|
—
|
—
|
(65,254
|
)
|
—
|
—
|
(65,254
|
)
|
74,372
|
9,118
|
||||||||||||||||||||||
Balance at December 31, 2019
|
140,340
|
$
|
140
|
$
|
2,203,778
|
$
|
(25,290
|
)
|
$
|
(707,534
|
)
|
$
|
1,471,094
|
$
|
213,453
|
$
|
1,684,547
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Operating activities:
|
||||||||||||
Net income (loss)
|
$
|
303,262
|
$
|
214,985
|
$
|
(10,783
|
)
|
|||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
||||||||||||
Depreciation
|
12,540
|
10,706
|
6,708
|
|||||||||
Amortization of right-of-use operating lease assets
|
1,542
|
—
|
—
|
|||||||||
Amortization of patents
|
1,912
|
1,822
|
1,641
|
|||||||||
Amortization of premium (discount) on investments, net
|
(7,485
|
)
|
(1,013
|
)
|
6,752
|
|||||||
Amortization of debt issuance costs
|
1,942
|
1,810
|
1,616
|
|||||||||
Amortization of convertible senior notes discount
|
37,338
|
33,363
|
30,920
|
|||||||||
Amortization of long-term financing liability for leased facility
|
—
|
—
|
3,659
|
|||||||||
Stock-based compensation expense
|
146,574
|
131,312
|
85,975
|
|||||||||
Gain on investment in Regulus Therapeutics, Inc.
|
—
|
—
|
(374
|
)
|
||||||||
Loss on extinguishment of financing liability for leased facility
|
—
|
—
|
7,689
|
|||||||||
Loss on early retirement of debt
|
21,865
|
—
|
—
|
|||||||||
Deferred income taxes (including benefit from valuation allowance release)
|
(7,096
|
)
|
(290,516
|
)
|
—
|
|||||||
Non-cash losses related to patents, licensing, property, plant and equipment and investments
|
2,034
|
1,012
|
3,302
|
|||||||||
Changes in operating assets and liabilities:
|
||||||||||||
Contracts receivable
|
(47,674
|
)
|
47,595
|
45,088
|
||||||||
Inventories
|
(5,411
|
)
|
1,400
|
(2,493
|
)
|
|||||||
Other current and long-term assets
|
(44,659
|
)
|
(29,348
|
)
|
(58,367
|
)
|
||||||
Long-term income tax receivable
|
8,418
|
(223
|
)
|
(9,114
|
)
|
|||||||
Accounts payable
|
(16,343
|
)
|
(655
|
)
|
1,784
|
|||||||
Income taxes
|
31,656
|
(710
|
)
|
435
|
||||||||
Accrued compensation
|
8,089
|
4,117
|
965
|
|||||||||
Accrued liabilities and deferred rent
|
16,499
|
(17,023
|
)
|
28,564
|
||||||||
Deferred contract revenue
|
(119,283
|
)
|
494,254
|
30,182
|
||||||||
Net cash provided by operating activities
|
345,720
|
602,888
|
174,149
|
|||||||||
Investing activities:
|
||||||||||||
Purchases of short-term investments
|
(1,946,726
|
)
|
(1,794,735
|
)
|
(877,810
|
)
|
||||||
Proceeds from the sale of short-term investments
|
1,951,734
|
882,824
|
557,369
|
|||||||||
Purchases of property, plant and equipment
|
(30,905
|
)
|
(13,608
|
)
|
(34,764
|
)
|
||||||
Acquisition of licenses and other assets, net
|
(5,377
|
)
|
(4,044
|
)
|
(3,093
|
)
|
||||||
Purchase of strategic investments
|
(10,000
|
)
|
—
|
(2,500
|
)
|
|||||||
Proceeds from the sale of Regulus Therapeutics, Inc.
|
—
|
—
|
2,507
|
|||||||||
Net cash (used in) provided by investing activities
|
(41,274
|
)
|
(929,563
|
)
|
(358,291
|
)
|
||||||
Financing activities:
|
||||||||||||
Proceeds from equity, net
|
119,657
|
27,900
|
22,931
|
|||||||||
Payments of tax withholdings related to vesting of employee stock awards and exercise of employee stock options
|
(19,242
|
)
|
—
|
—
|
||||||||
Proceeds from the issuance of 0.125 percent convertible senior notes
|
109,500
|
—
|
—
|
|||||||||
0.125 percent convertible senior notes issuance costs
|
(10,428
|
)
|
—
|
—
|
||||||||
Proceeds from issuance of warrants
|
56,110
|
—
|
—
|
|||||||||
Purchase of note hedges
|
(108,684
|
)
|
—
|
—
|
||||||||
Repurchases and retirements of common stock
|
(34,392
|
)
|
—
|
—
|
||||||||
Principal payments on debt and capital lease obligations
|
(12,500
|
)
|
—
|
(3,599
|
)
|
|||||||
Proceeds from issuance of common stock in Akcea Therapeutics, Inc. from its initial public offering, net of underwriters’ discount
|
—
|
—
|
110,438
|
|||||||||
Proceeds from building mortgage debt, net of issuance costs
|
—
|
—
|
59,750
|
|||||||||
Proceeds from the issuance of common stock to Biogen
|
—
|
447,965
|
—
|
|||||||||
Proceeds from the issuance of common stock to Novartis
|
—
|
—
|
71,737
|
|||||||||
Proceeds from the sale of Akcea Therapeutics, Inc. common stock to Novartis in a private placement
|
—
|
—
|
50,000
|
|||||||||
Offering costs paid
|
—
|
—
|
(2,037
|
)
|
||||||||
Payment to settle financing liability for leased facility
|
—
|
—
|
(80,133
|
)
|
||||||||
Net cash provided by financing activities
|
100,021
|
475,865
|
229,087
|
|||||||||
Net increase in cash and cash equivalents
|
404,467
|
149,190
|
44,945
|
|||||||||
Cash and cash equivalents at beginning of year
|
278,820
|
129,630
|
84,685
|
|||||||||
Cash and cash equivalents at end of year
|
$
|
683,287
|
$
|
278,820
|
$
|
129,630
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Supplemental disclosures of cash flow information:
|
||||||||||||
Interest paid
|
$
|
9,870
|
$
|
9,592
|
$
|
8,035
|
||||||
Income taxes paid
|
$
|
9,041
|
$
|
—
|
$
|
—
|
||||||
Supplemental disclosures of non-cash investing and financing activities:
|
||||||||||||
Right-of-use assets obtained in exchange for lease liabilities
|
$
|
14,178
|
$
|
—
|
$
|
—
|
||||||
Amounts accrued for capital and patent expenditures
|
$
|
3,126
|
$
|
4,428
|
$
|
1,983
|
||||||
Purchases of property, plant and equipment included in long-term obligations
|
$
|
—
|
$
|
3,350
|
$
|
—
|
||||||
0.125 percent convertible senior notes principal issued related to our December 2019 debt exchange/issuance
|
$
|
439,326
|
$
|
—
|
$
|
—
|
||||||
1 percent convertible senior notes principal extinguished related to our December 2019 debt exchange
|
$
|
375,590
|
$
|
—
|
$
|
—
|
Year Ended December 31, 2019
|
Weighted
Average Shares
Owned in Akcea
|
Akcea’s
Net Income
Per Share
|
Ionis’
Portion of
Akcea’s Net Income
|
|||||||||
Common shares
|
70,100
|
$
|
0.49
|
$
|
34,073
|
|||||||
Akcea’s net income attributable to our ownership
|
$
|
34,073
|
||||||||||
Ionis’ stand-alone net income
|
262,490
|
|||||||||||
Net income available to Ionis common stockholders
|
$
|
296,563
|
||||||||||
Weighted average shares outstanding
|
139,998
|
|||||||||||
Basic net income per share
|
$
|
2.12
|
Year Ended December 31, 2018
|
Weighted
Average Shares
Owned in Akcea
|
Akcea’s
Net Loss
Per Share
|
Ionis’
Portion of
Akcea’s Net Loss
|
|||||||||
Common shares
|
59,812
|
$
|
(2.74
|
)
|
$
|
(163,938
|
)
|
|||||
Akcea’s net loss attributable to our ownership
|
$
|
(163,938
|
)
|
|||||||||
Ionis’ stand-alone net income
|
440,806
|
|||||||||||
Net income available to Ionis common stockholders
|
$
|
276,868
|
||||||||||
Weighted average shares outstanding
|
132,320
|
|||||||||||
Basic net income per share
|
$
|
2.09
|
Year Ended December 31, 2017
|
Weighted
Average Shares
Owned in Akcea
|
Akcea’s
Net Loss
Per Share
|
Ionis’
Portion of
Akcea’s Net Loss
|
|||||||||
Common shares
|
20,669
|
$
|
(3.08
|
)
|
$
|
(63,638
|
)
|
|||||
Preferred shares
|
15,748
|
(1.80
|
)
|
(28,346
|
)
|
|||||||
Akcea’s net loss attributable to our ownership
|
$
|
(91,984
|
)
|
|||||||||
Ionis’ stand-alone net income
|
110,776
|
|||||||||||
Net income available to Ionis common stockholders
|
$
|
18,792
|
||||||||||
Weighted average shares outstanding
|
124,016
|
|||||||||||
Basic net income per share
|
$
|
0.15
|
Year Ended December 31, 2019
|
Income
(Numerator)
|
Shares
(Denominator)
|
Per-Share
Amount
|
|||||||||
Net income available to Ionis common stockholders
|
$
|
296,563
|
139,998
|
$
|
2.12
|
|||||||
Effect of dilutive securities:
|
||||||||||||
Shares issuable upon exercise of stock options
|
—
|
2,090
|
||||||||||
Shares issuable upon restricted stock award issuance
|
—
|
766
|
||||||||||
Shares issuable related to our Employee Stock Purchase Plan
|
—
|
18
|
||||||||||
Income available to Ionis common stockholders, plus assumed conversions
|
$
|
296,563
|
142,872
|
$
|
2.08
|
Year Ended December 31, 2018
|
Income
(Numerator)
|
Shares
(Denominator)
|
Per-Share
Amount
|
|||||||||
Net income available to Ionis common stockholders
|
$
|
276,868
|
132,320
|
$
|
2.09
|
|||||||
Effect of dilutive securities:
|
||||||||||||
Shares issuable upon exercise of stock options
|
—
|
1,216
|
||||||||||
Shares issuable upon restricted stock award issuance
|
—
|
514
|
||||||||||
Shares issuable related to our Employee Stock Purchase Plan
|
—
|
6
|
||||||||||
Income available to Ionis common stockholders, plus assumed conversions
|
$
|
276,868
|
134,056
|
$
|
2.07
|
Year Ended December 31, 2017
|
Income
(Numerator)
|
Shares
(Denominator)
|
Per-Share
Amount
|
|||||||||
Net income available to Ionis common stockholders
|
$
|
18,792
|
124,016
|
$
|
0.15
|
|||||||
Effect of dilutive securities:
|
||||||||||||
Shares issuable upon exercise of stock options
|
—
|
1,619
|
||||||||||
Shares issuable upon restricted stock award issuance
|
—
|
459
|
||||||||||
Shares issuable related to our Employee Stock Purchase Plan
|
—
|
4
|
||||||||||
Income available to Ionis common stockholders, plus assumed conversions
|
$
|
18,792
|
126,098
|
$
|
0.15
|
1. |
Identify the contract
|
● |
We and our partner approved the contract and we are both committed to perform our obligations;
|
● |
We have identified our rights, our partner’s rights and the payment terms;
|
● |
We have concluded that the contract has commercial substance, meaning that the risk, timing, or amount of our future cash flows is expected to change as a result of the contract; and
|
● |
We believe collectability is probable.
|
2. |
Identify the performance obligations
|
3. |
Determine the transaction price
|
4. |
Allocate the transaction price
|
● |
Estimated future product sales;
|
● |
Estimated royalties on future product sales;
|
● |
Contractual milestone payments;
|
● |
Expenses we expect to incur;
|
● |
Income taxes; and
|
● |
A discount rate.
|
● |
The number of internal hours we estimate we will spend performing these services;
|
● |
The estimated cost of work we will perform;
|
● |
The estimated cost of work that we will contract with third parties to perform; and
|
● |
The estimated cost of API we will use.
|
5. |
Recognize revenue
|
1) |
If the additional goods and/or services are distinct from the other performance obligations in the original agreement; and
|
2) |
If the goods and/or services are at a stand-alone selling price.
|
● |
Whether the agreements were negotiated together with a single objective;
|
● |
Whether the amount of consideration in one contract depends on the price or performance of the other agreement; or
|
● |
Whether the goods and/or services promised under the agreements are a single performance obligation.
|
Year Ending December 31,
|
Amortization
(in millions)
|
|||
2020
|
$
|
1.8
|
||
2021
|
$
|
1.8
|
||
2022
|
$
|
1.7
|
||
2023
|
$
|
1.6
|
||
2024
|
$
|
1.4
|
|
December 31,
|
|||||||
2019
|
2018
|
|||||||
Clinical expenses
|
$
|
24,461
|
$
|
22,125
|
||||
In-licensing expenses
|
10,289
|
12,298
|
||||||
Other miscellaneous expenses
|
32,019
|
13,080
|
||||||
Total accrued liabilities
|
$
|
66,769
|
$
|
47,503
|
● |
2.8 million shares in the first quarter of 2019 as payment for the sublicense fee Akcea owed us for Novartis’s license of AKCEA-APO(a)-LRx, and;
|
● |
6.9 million shares in the fourth quarter of 2019 as payment for the sublicense fee Akcea owed us for Pfizer’s license of AKCEA-ANGPTL3-LRx.
|
|
December 31,
|
|||||||
2019
|
2018
|
|||||||
Raw materials:
|
||||||||
Raw materials- clinical
|
$
|
9,363
|
$
|
8,497
|
||||
Raw materials- commercial
|
6,520
|
—
|
||||||
Total raw materials
|
15,883
|
8,497
|
||||||
Work in process
|
2,039
|
—
|
||||||
Finished goods
|
258
|
85
|
||||||
Total inventory
|
$
|
18,180
|
$
|
8,582
|
|
Estimated Useful Lives
|
December 31,
|
||||||||||
(in years)
|
2019
|
2018
|
||||||||||
Computer software, laboratory, manufacturing and other equipment
|
3 to 10
|
$
|
60,965
|
$
|
53,496
|
|||||||
Building, building improvements and building systems
|
15 to 40
|
119,830
|
97,528
|
|||||||||
Land improvements
|
20
|
2,853
|
2,853
|
|||||||||
Leasehold improvements
|
5 to 15
|
13,600
|
18,981
|
|||||||||
Furniture and fixtures
|
5 to 10
|
7,354
|
6,283
|
|||||||||
204,602
|
179,141
|
|||||||||||
Less accumulated depreciation
|
(74,013
|
)
|
(61,474
|
)
|
||||||||
130,589
|
117,667
|
|||||||||||
Land
|
23,062
|
14,493
|
||||||||||
Total
|
$
|
153,651
|
$
|
132,160
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Beginning balance accumulated other comprehensive loss
|
$
|
(32,016
|
)
|
$
|
(31,759
|
)
|
$
|
(30,358
|
)
|
|||
Unrealized gains (losses) on securities, net of tax (1)
|
6,633
|
(280
|
)
|
(960
|
)
|
|||||||
Amounts reclassified from accumulated other comprehensive loss
|
—
|
—
|
(374
|
)
|
||||||||
Currency translation adjustment
|
93
|
23
|
(67
|
)
|
||||||||
Net other comprehensive loss for the period
|
6,726
|
(257
|
)
|
(1,401
|
)
|
|||||||
Ending balance accumulated other comprehensive loss
|
$
|
(25,290
|
)
|
$
|
(32,016
|
)
|
$
|
(31,759
|
)
|
(1) |
A tax benefit of $1.4 million and $0.3 million was included in other comprehensive loss for the years ended December 31, 2019 and 2018, respectively. There was no tax benefit or expense for other comprehensive loss for the year ended December 31, 2017.
|
|
At
December 31, 2019
|
Quoted Prices in
Active Markets
(Level 1)
|
Significant Other
Observable Inputs
(Level 2)
|
Significant
Unobservable Inputs
(Level 3)
|
||||||||||||
Cash equivalents (1)
|
$
|
418,406
|
$
|
418,406
|
$
|
—
|
$
|
—
|
||||||||
Corporate debt securities (2)
|
1,102,568
|
—
|
1,102,568
|
—
|
||||||||||||
Debt securities issued by U.S. government agencies (3)
|
329,404
|
—
|
329,404
|
—
|
||||||||||||
Debt securities issued by the U.S. Treasury (4)
|
363,694
|
363,694
|
—
|
—
|
||||||||||||
Debt securities issued by states of the U.S. and political subdivisions of the states (4)
|
40,407
|
—
|
40,407
|
—
|
||||||||||||
Investment in ProQR Therapeutics N.V. (5)
|
4,506
|
—
|
—
|
4,506
|
||||||||||||
Total
|
$
|
2,258,985
|
$
|
782,100
|
$
|
1,472,379
|
$
|
4,506
|
|
At
December 31,
2018
|
Quoted Prices in
Active Markets
(Level 1)
|
Significant Other
Observable Inputs
(Level 2)
|
Significant
Unobservable Inputs
(Level 3)
|
||||||||||||
Cash equivalents (1)
|
$
|
146,281
|
$
|
146,281
|
$
|
—
|
$
|
—
|
||||||||
Corporate debt securities (6)
|
1,252,960
|
—
|
1,252,960
|
—
|
||||||||||||
Debt securities issued by U.S. government agencies (4)
|
276,612
|
—
|
276,612
|
—
|
||||||||||||
Debt securities issued by the U.S. Treasury (7)
|
260,154
|
260,154
|
—
|
—
|
||||||||||||
Debt securities issued by states of the U.S. and political subdivisions of the states (4)
|
79,942
|
—
|
79,942
|
—
|
||||||||||||
Investment in ProQR Therapeutics N.V. (5)
|
1,349
|
—
|
—
|
1,349
|
||||||||||||
Total
|
$
|
2,017,298
|
$
|
406,435
|
$
|
1,609,514
|
$
|
1,349
|
(1) |
Included in cash and cash equivalents on our consolidated balance sheet.
|
(2) |
$19.0 million included in cash and cash equivalents on our consolidated balance sheet, with the difference included in short-term investments on our consolidated balance sheet.
|
(3) |
$0.8 million included in cash and cash equivalents on our consolidated balance sheet, with the difference included in short-term investments on our consolidated balance sheet.
|
(4) |
Included in short-term investments.
|
(5) |
Included in other current assets on our consolidated balance sheet.
|
(6) |
$50.2 million included in cash and cash equivalents on our consolidated balance sheet, with the difference included in short-term investments on our consolidated balance sheet.
|
(7) |
$14.2 million included in cash and cash equivalents on our consolidated balance sheet, with the difference included in short-term investments on our consolidated balance sheet.
|
1) |
When a participant is considered a customer in a collaborative arrangement, all of the associated accounting under Topic 606 should be applied
|
● |
We will apply all of the associated accounting under Topic 606 when we determine a participant in a collaborative arrangement is a customer
|
2) |
Adds “unit of account” concept to collaboration accounting guidance to align with Topic 606. The “unit of account” concept is used to determine if revenue is recognized or if a contra expense is recognized from consideration received under a collaboration
|
● |
We will use the “unit of account” concept when we receive consideration under a collaborative arrangement to determine when we recognize revenue or a contra expense
|
3) |
The clarifying guidance precludes us from recognizing revenue under Topic 606 when we determine a transaction with a collaborative partner is not a customer and is not directly related to the sales to third parties
|
● |
When we conclude a collaboration partner is not a customer and is not directly related to the sales to third parties, we will not recognize revenue for the transaction
|
One year or less
|
70
|
%
|
||
After one year but within two years
|
20
|
%
|
||
After two years but within three and a half years
|
10
|
%
|
||
Total
|
100
|
%
|
|
Gross Unrealized
|
Estimated
|
||||||||||||||
December 31, 2019
|
Cost (1)
|
Gains
|
Losses
|
Fair Value
|
||||||||||||
Available-for-sale securities:
|
||||||||||||||||
Corporate debt securities (2)
|
$
|
669,665
|
$
|
1,451
|
$
|
(43
|
)
|
$
|
671,073
|
|||||||
Debt securities issued by U.S. government agencies
|
188,216
|
303
|
(43
|
)
|
188,476
|
|||||||||||
Debt securities issued by the U.S. Treasury (2)
|
327,670
|
232
|
(27
|
)
|
327,875
|
|||||||||||
Debt securities issued by states of the U.S. and political subdivisions of the states
|
21,065
|
26
|
(5
|
)
|
21,086
|
|||||||||||
Total securities with a maturity of one year or less
|
1,206,616
|
2,012
|
(118
|
)
|
1,208,510
|
|||||||||||
Corporate debt securities
|
428,627
|
2,911
|
(43
|
)
|
431,495
|
|||||||||||
Debt securities issued by U.S. government agencies
|
140,988
|
57
|
(117
|
)
|
140,928
|
|||||||||||
Debt securities issued by the U.S. Treasury
|
35,822
|
9
|
(12
|
)
|
35,819
|
|||||||||||
Debt securities issued by states of the U.S. and political subdivisions of the states
|
19,309
|
18
|
(6
|
)
|
19,321
|
|||||||||||
Total securities with a maturity of more than one year
|
624,746
|
2,995
|
(178
|
)
|
627,563
|
|||||||||||
Total available-for-sale securities
|
$
|
1,831,362
|
$
|
5,007
|
$
|
(296
|
)
|
$
|
1,836,073
|
|||||||
Equity securities:
|
||||||||||||||||
Total equity securities included in other current assets (3)
|
$
|
4,712
|
$
|
-
|
$
|
(870
|
)
|
$
|
3,842
|
|||||||
Total equity securities included in deposits and other assets (4)
|
10,000
|
-
|
-
|
10,000
|
||||||||||||
Total equity securities
|
$
|
14,712
|
$
|
-
|
$
|
(870
|
)
|
$
|
13,842
|
|||||||
Total available-for-sale and equity securities
|
$
|
1,846,074
|
$
|
5,007
|
$
|
(1,166
|
)
|
$
|
1,849,915
|
|
Gross Unrealized
|
Estimated
|
||||||||||||||
December 31, 2018
|
Cost (1)
|
Gains
|
Losses
|
Fair Value
|
||||||||||||
Available-for-sale securities:
|
||||||||||||||||
Corporate debt securities (2)
|
$
|
956,879
|
$
|
13
|
$
|
(1,858
|
)
|
$
|
955,034
|
|||||||
Debt securities issued by U.S. government agencies
|
168,839
|
3
|
(104
|
)
|
168,738
|
|||||||||||
Debt securities issued by the U.S. Treasury
|
244,640
|
15
|
(77
|
)
|
244,578
|
|||||||||||
Debt securities issued by states of the U.S. and political subdivisions of the states (2)
|
63,572
|
—
|
(323
|
)
|
63,249
|
|||||||||||
Total securities with a maturity of one year or less
|
1,433,930
|
31
|
(2,362
|
)
|
1,431,599
|
|||||||||||
Corporate debt securities
|
299,018
|
194
|
(1,286
|
)
|
297,926
|
|||||||||||
Debt securities issued by U.S. government agencies
|
107,789
|
194
|
(109
|
)
|
107,874
|
|||||||||||
Debt securities issued by the U.S. Treasury
|
15,600
|
—
|
(24
|
)
|
15,576
|
|||||||||||
Debt securities issued by states of the U.S. and political subdivisions of the states
|
16,980
|
—
|
(287
|
)
|
16,693
|
|||||||||||
Total securities with a maturity of more than one year
|
439,387
|
388
|
(1,706
|
)
|
438,069
|
|||||||||||
Total available-for-sale securities
|
$
|
1,873,317
|
$
|
419
|
$
|
(4,068
|
)
|
$
|
1,869,668
|
|||||||
Equity securities:
|
||||||||||||||||
Total equity securities included in other current assets (3)
|
$
|
1,212
|
$
|
137
|
$
|
—
|
$
|
1,349
|
||||||||
Total available-for-sale and equity securities
|
$
|
1,874,529
|
$
|
556
|
$
|
(4,068
|
)
|
$
|
1,871,017
|
(1) |
We hold our available-for-sale securities at amortized cost.
|
(2) |
Includes investments classified as cash equivalents on our consolidated balance sheet.
|
(3) |
Our equity securities included in other current assets consisted of our investment in ProQR, which is a public company. We recognize our public company equity securities at fair value.
|
(4) |
Our equity securities included in deposits and other assets consisted of our investment in Empirico, which is a private company. We recognize our private company equity securities at cost minus impairments, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer on our consolidated balance sheet.
|
|
Less than 12 Months of
Temporary Impairment
|
More than 12 Months of
Temporary Impairment
|
Total Temporary
Impairment
|
|||||||||||||||||||||||||
Number of
Investments
|
Estimated
Fair Value
|
Unrealized
Losses
|
Estimated
Fair Value
|
Unrealized
Losses
|
Estimated
Fair Value
|
Unrealized
Losses
|
||||||||||||||||||||||
Corporate debt securities
|
49
|
$
|
131,702
|
$
|
(75
|
)
|
$
|
11,840
|
$
|
(11
|
)
|
$
|
143,542
|
$
|
(86
|
)
|
||||||||||||
Debt securities issued by U.S. government agencies
|
43
|
149,731
|
(136
|
)
|
37,041
|
(24
|
)
|
186,772
|
(160
|
)
|
||||||||||||||||||
Debt securities issued by the U.S. Treasury
|
10
|
84,270
|
(39
|
)
|
—
|
—
|
84,270
|
(39
|
)
|
|||||||||||||||||||
Debt securities issued by states of the U.S. and political subdivisions of the states
|
11
|
10,241
|
(5
|
)
|
10,303
|
(6
|
)
|
20,544
|
(11
|
)
|
||||||||||||||||||
Total temporarily impaired securities
|
113
|
$
|
375,944
|
$
|
(255
|
)
|
$
|
59,184
|
$
|
(41
|
)
|
$
|
435,128
|
$
|
(296
|
)
|
|
December 31,
|
|||||||
2019
|
2018
|
|||||||
0.125 percent convertible senior notes
|
$
|
434,711
|
$
|
—
|
||||
1 percent convertible senior notes
|
275,333
|
568,215
|
||||||
Long-term mortgage debt
|
59,913
|
59,842
|
||||||
Principal balance of fixed rate note with Morgan Stanley (1)
|
—
|
12,500
|
||||||
Leases and other obligations
|
17,569
|
6,163
|
||||||
Total
|
$
|
787,526
|
$
|
646,720
|
||||
Less: current portion
|
(2,026
|
)
|
(13,749
|
)
|
||||
Total Long-Term Obligations
|
$
|
785,500
|
$
|
632,971
|
(1) |
Our $12.5 million fixed rate note with Morgan Stanley was included in our current portion of long-term obligations on our consolidated balance sheet at December 31, 2018. We paid off our fixed rate note in the third quarter of 2019.
|
|
0.125% Notes
|
|||
Outstanding principal balance
|
$
|
548.8
|
||
Maturity date
|
December 15, 2024
|
|||
Interest rate
|
0.125
|
%
|
||
Conversion price per share
|
$
|
83.28
|
||
Total shares of common stock subject to conversion
|
6.6
|
|
0.125% Notes
|
|||
Fair value of outstanding notes
|
$
|
558.7
|
||
Principal amount of convertible notes outstanding
|
$
|
548.8
|
||
Unamortized portion of debt discount
|
$
|
105.2
|
||
Long-term debt
|
$
|
434.7
|
||
Carrying value of equity component
|
$
|
105.8
|
|
1% Notes
|
|||
Outstanding principal balance
|
$
|
309.9
|
||
Maturity date
|
November 30, 2021
|
|||
Interest rate
|
1 percent
|
|||
Conversion price per share
|
$
|
66.81
|
||
Total shares of common stock subject to conversion
|
4.6
|
|
December 31,
|
|||||||
2019
|
2018
|
|||||||
Fair value of outstanding notes
|
$
|
354.8
|
$
|
725.0
|
||||
Principal amount of convertible notes outstanding
|
$
|
309.9
|
$
|
685.5
|
||||
Unamortized portion of debt discount
|
$
|
32.8
|
$
|
110.8
|
||||
Long-term debt
|
$
|
275.3
|
$
|
568.2
|
||||
Carrying value of equity component
|
$
|
33.5
|
$
|
219.0
|
|
1% Notes
|
0.125% Notes
|
||
Nonconvertible debt borrowing rate
|
7.4 percent
|
4.4 percent
|
||
Effective interest rate (1)
|
7.5 percent
|
4.9 percent
|
||
Amortization period of debt discount
|
7 years
|
5 years
|
(1) |
For our 1% Notes, our effective interest rate represents our effective interest rate after our December 2019 debt exchange.
|
2020
|
$
|
6,260
|
||
2021
|
316,114
|
|||
2022
|
3,495
|
|||
2023
|
4,180
|
|||
2024
|
553,006
|
|||
Thereafter
|
64,429
|
|||
Subtotal
|
$
|
947,484
|
||
Less: current portion
|
(2,026
|
)
|
||
Less: fixed and determinable interest
|
(28,014
|
)
|
||
Less: unamortized portion of debt discount
|
(137,975
|
)
|
||
Plus: lease liabilities
|
17,235
|
|||
Total
|
$
|
796,704
|
|
At December 31, 2019
|
|||
Right-of-use operating lease assets (1)
|
$
|
12.6
|
||
Operating lease liabilities (2)
|
$
|
17.2
|
||
Weighted average remaining lease term
|
8.1 years
|
|||
Weighted average discount rate
|
7.6
|
%
|
(1) |
Included in deposits and other assets on our consolidated balance sheet.
|
(2) |
Current portion of $2.0 million was included in current portion of long-term obligations on our consolidated balance sheet, with the difference included in long-term obligations.
|
|
Operating Leases
|
|||
Year ending December 31,
|
$ | |||
2020
|
3,285
|
|||
2021
|
3,022
|
|||
2022
|
2,781
|
|||
2023
|
2,520
|
|||
2024
|
2,396
|
|||
Thereafter
|
9,465
|
|||
Total minimum lease payments
|
23,469
|
|||
Less:
|
||||
Imputed interest
|
(6,234
|
)
|
||
Total operating lease liabilities
|
$
|
17,235
|
● |
arrange for assumption, continuation, or substitution of a stock award by a surviving or acquiring entity (or its parent company);
|
● |
arrange for the assignment of any reacquisition or repurchase rights applicable to any shares of our common stock issued pursuant to a stock award to the surviving or acquiring corporation (or its parent company);
|
● |
accelerate the vesting and exercisability of a stock award followed by the termination of the stock award;
|
● |
arrange for the lapse of any reacquisition or repurchase rights applicable to any shares of our common stock issued pursuant to a stock award;
|
● |
cancel or arrange for the cancellation of a stock award, to the extent not vested or not exercised prior to the effective date of the corporate transaction, in exchange for cash consideration, if any, as the Board, in its sole discretion, may consider appropriate; and
|
● |
arrange for the surrender of a stock award in exchange for a payment equal to the excess of (a) the value of the property the holder of the stock award would have received upon the exercise of the stock award, over (b) any exercise price payable by such holder in connection with such exercise.
|
|
Number
of Shares
|
Weighted
Average Exercise
Price Per Share
|
Average
Remaining
Contractual Term
(Years)
|
Aggregate
Intrinsic
Value
|
||||||||||||
Outstanding at December 31, 2018
|
11,311
|
$
|
47.85
|
|||||||||||||
Granted
|
2,543
|
$
|
56.19
|
|||||||||||||
Exercised
|
(2,617
|
)
|
$
|
40.48
|
||||||||||||
Cancelled/forfeited/expired
|
(236
|
)
|
$
|
50.11
|
||||||||||||
Outstanding at December 31, 2019
|
11,001
|
$
|
51.48
|
4.41
|
$
|
104,029
|
||||||||||
Exercisable at December 31, 2019
|
6,004
|
$
|
50.95
|
3.34
|
$
|
59,780
|
|
Number
of Shares
|
Weighted Average
Grant Date Fair
Value Per Share
|
||||||
Non-vested at December 31, 2018
|
1,246
|
$
|
50.20
|
|||||
Granted
|
1,114
|
$
|
60.23
|
|||||
Vested
|
(422
|
)
|
$
|
51.36
|
||||
Cancelled/forfeited
|
(72
|
)
|
$
|
53.39
|
||||
Non-vested at December 31, 2019
|
1,866
|
$
|
55.80
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Cost of products sold
|
$
|
438
|
$
|
160
|
$
|
—
|
||||||
Research, development and patent
|
95,348
|
76,557
|
64,521
|
|||||||||
Selling, general and administrative
|
50,788
|
54,595
|
21,454
|
|||||||||
Total
|
$
|
146,574
|
$
|
131,312
|
$
|
85,975
|
|
December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Risk-free interest rate
|
2.3
|
%
|
2.4
|
%
|
1.8
|
%
|
||||||
Dividend yield
|
0.0
|
%
|
0.0
|
%
|
0.0
|
%
|
||||||
Volatility
|
60.3
|
%
|
63.0
|
%
|
65.9
|
%
|
||||||
Expected life
|
4.8 years
|
4.6 years
|
4.5 years
|
|
December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Risk-free interest rate
|
1.9
|
%
|
2.8
|
%
|
2.2
|
%
|
||||||
Dividend yield
|
0.0
|
%
|
0.0
|
%
|
0.0
|
%
|
||||||
Volatility
|
60.7
|
%
|
61.5
|
%
|
61.2
|
%
|
||||||
Expected life
|
6.6 years
|
6.6 years
|
6.6 years
|
|
December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Risk-free interest rate
|
2.4
|
%
|
1.8
|
%
|
0.8
|
%
|
||||||
Dividend yield
|
0.0
|
%
|
0.0
|
%
|
0.0
|
%
|
||||||
Volatility
|
45.6
|
%
|
47.3
|
%
|
59.9
|
%
|
||||||
Expected life
|
6 months
|
6 months
|
6 months
|
|
December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Risk-free interest rate
|
2.2
|
%
|
2.8
|
%
|
1.9
|
%
|
||||||
Dividend yield
|
0.0
|
%
|
0.0
|
%
|
0.0
|
%
|
||||||
Volatility
|
75.4
|
%
|
77.1
|
%
|
79.5
|
%
|
||||||
Expected life
|
6.09 years
|
6.08 years
|
6.06 years
|
|
December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Risk-free interest rate
|
1.8
|
%
|
2.9
|
%
|
1.9
|
%
|
||||||
Dividend yield
|
0.0
|
%
|
0.0
|
%
|
0.0
|
%
|
||||||
Volatility
|
73.8
|
%
|
78.2
|
%
|
79.4
|
%
|
||||||
Expected life
|
6.25 years
|
6.42 years
|
6.25 years
|
|
December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Risk-free interest rate
|
2.4
|
%
|
1.9
|
%
|
1.1
|
%
|
||||||
Dividend yield
|
0.0
|
%
|
0.0
|
%
|
0.0
|
%
|
||||||
Volatility
|
60.0
|
%
|
64.2
|
%
|
73.3
|
%
|
||||||
Expected life
|
6 months
|
6 months
|
6 months
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
United States
|
$
|
344,280
|
$
|
(69,576
|
)
|
$
|
(5,289
|
)
|
||||
Foreign
|
2,489
|
(6,580
|
)
|
(11,474
|
)
|
|||||||
Income (loss) before income taxes
|
$
|
346,769
|
$
|
(76,156
|
)
|
$
|
(16,763
|
)
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Current:
|
||||||||||||
Federal
|
$
|
35,861
|
$
|
438
|
$
|
(7,460
|
)
|
|||||
State
|
14,329
|
(1,442
|
)
|
1,246
|
||||||||
Foreign
|
413
|
374
|
234
|
|||||||||
Total current income tax expense (benefit)
|
50,603
|
(630
|
)
|
(5,980
|
)
|
|||||||
Deferred:
|
||||||||||||
Federal
|
(7,096
|
)
|
(290,511
|
)
|
—
|
|||||||
State
|
—
|
—
|
—
|
|||||||||
Total deferred income tax benefit
|
(7,096
|
)
|
(290,511
|
)
|
—
|
|||||||
Total income tax expense (benefit)
|
$
|
43,507
|
$
|
(291,141
|
)
|
$
|
(5,980
|
)
|
|
Year Ended December 31,
|
|||||||||||||||||||||||
2019
|
2018
|
2017
|
||||||||||||||||||||||
Pre-tax income (loss)
|
$
|
346,769
|
$
|
(76,156
|
)
|
$
|
(16,763
|
)
|
||||||||||||||||
Statutory rate
|
72,822
|
21.0
|
%
|
(15,993
|
)
|
21.0
|
%
|
(5,867
|
)
|
35.0
|
%
|
|||||||||||||
State income tax net of federal benefit
|
49,119
|
14.2
|
%
|
(2,202
|
)
|
2.9
|
%
|
820
|
(4.9
|
)%
|
||||||||||||||
Foreign
|
340
|
0.1
|
%
|
1,735
|
(2.3
|
)%
|
4,299
|
(25.6
|
)%
|
|||||||||||||||
Net change in valuation allowance
|
(37,765
|
)
|
(10.9
|
)%
|
(277,924
|
)
|
364.9
|
%
|
(86,296
|
)
|
514.8
|
%
|
||||||||||||
Net operating loss expiration
|
—
|
0.0
|
%
|
8,864
|
(11.6
|
)%
|
3,987
|
(23.8
|
)%
|
|||||||||||||||
TEGSEDI licensing gain
|
—
|
0.0
|
%
|
59,583
|
(78.2
|
)%
|
—
|
0.0
|
%
|
|||||||||||||||
Impact from outside basis differences
|
(16,344
|
)
|
(4.7
|
)%
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
||||||||||||||
Tax credits
|
(22,296
|
)
|
(6.4
|
)%
|
(73,362
|
)
|
96.3
|
%
|
(32,769
|
)
|
195.5
|
%
|
||||||||||||
Deferred tax true-up
|
646
|
0.2
|
%
|
9,947
|
(13.1
|
)%
|
4,848
|
(28.9
|
)%
|
|||||||||||||||
Tax rate change
|
1,811
|
0.5
|
%
|
(1,808
|
)
|
2.4
|
%
|
114,832
|
(685.0
|
)%
|
||||||||||||||
Non-deductible compensation
|
3,361
|
1.0
|
%
|
3,154
|
(4.1
|
)%
|
1,575
|
(9.4
|
)%
|
|||||||||||||||
Other non-deductible items
|
329
|
0.1
|
%
|
(569
|
)
|
0.7
|
%
|
2,548
|
(15.2
|
)%
|
||||||||||||||
Akcea deconsolidation adjustment at IPO
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
469
|
(2.8
|
)%
|
|||||||||||||||
Stock-based compensation
|
(4,837
|
)
|
(1.4
|
)%
|
(4,199
|
)
|
5.5
|
%
|
(14,337
|
)
|
85.5
|
%
|
||||||||||||
Foreign-derived intangible income benefit
|
(2,071
|
)
|
(0.6
|
)%
|
—
|
0.0
|
%
|
—
|
0.0
|
%
|
||||||||||||||
Other
|
(1,608
|
)
|
(0.5
|
)%
|
1,633
|
(2.1
|
)%
|
(89
|
)
|
0.5
|
%
|
|||||||||||||
Effective rate
|
$
|
43,507
|
12.6
|
%
|
$
|
(291,141
|
)
|
382.3
|
%
|
$
|
(5,980
|
)
|
35.7
|
%
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Deferred Tax Assets:
|
||||||||
Net operating loss carryovers
|
$
|
20,191
|
$
|
89,717
|
||||
R&D credits
|
210,455
|
313,652
|
||||||
Deferred revenue
|
127,763
|
27,381
|
||||||
Stock-based compensation
|
65,703
|
61,027
|
||||||
Intangible and capital assets
|
77,861
|
49,007
|
||||||
Other
|
12,510
|
8,275
|
||||||
Total deferred tax assets
|
$
|
514,483
|
$
|
549,059
|
||||
Deferred Tax Liabilities:
|
||||||||
Convertible debt
|
$
|
(6,110
|
)
|
$
|
(24,018
|
)
|
||
Fixed assets
|
(1,958
|
)
|
—
|
|||||
Other
|
(3,884
|
)
|
—
|
|||||
Net deferred tax asset
|
$
|
502,531
|
$
|
525,041
|
||||
Valuation allowance
|
(196,974
|
)
|
(234,245
|
)
|
||||
Total net deferred tax assets and liabilities
|
$
|
305,557
|
$
|
290,796
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
Beginning balance of unrecognized tax benefits
|
$
|
68,301
|
$
|
78,014
|
$
|
66,999
|
||||||
Decrease for prior period tax positions
|
(867
|
)
|
(12,814
|
)
|
—
|
|||||||
Increase for prior period tax positions
|
736
|
—
|
1,520
|
|||||||||
Increase for current period tax positions
|
1,614
|
3,101
|
9,495
|
|||||||||
Ending balance of unrecognized tax benefits
|
$
|
69,784
|
$
|
68,301
|
$
|
78,014
|
● |
In the third quarter of 2018, we earned a $10 million milestone payment when Biogen initiated a Phase 1 study of IONIS-C9Rx.
|
● |
In the fourth quarter of 2018, we earned a $35 million license fee when Biogen licensed tofersen from us because Biogen had full use of the licenses without any continuing involvement from us.
|
● |
In the fourth quarter of 2018, we earned a $5 million milestone when Biogen initiated a Proof-of-Concept study for tofersen
|
● |
In the third quarter of 2019, we earned an $8 million milestone payment when Biogen initiated a Phase 1/2 study of ION859 (IONIS-LRRK2Rx) for the treatment of people with Parkinson’s disease under this collaboration.
|
● |
In the fourth quarter of 2019, we earned a $10 million milestone payment when Biogen advanced IONIS-C9Rx.
|
● |
In the second quarter of 2019, we achieved a $7.5 million milestone payment from Biogen when we advanced IONIS-MAPTRx for Alzheimer’s disease under this collaboration.
|
● |
In the fourth quarter of 2019, we achieved a $12 million milestone payment from Biogen when we entered into an agreement to conduct a long-term extension study for IONIS-MAPTRx.
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
SPINRAZA royalties (commercial revenue)
|
$
|
293.0
|
$
|
237.9
|
$
|
112.5
|
||||||
R&D revenue
|
180.6
|
137.1
|
150.6
|
|||||||||
Total revenue from our relationship with Biogen
|
$
|
473.6
|
$
|
375.0
|
$
|
263.1
|
||||||
Percentage of total revenue
|
42
|
%
|
63
|
%
|
51
|
%
|
● |
In the first quarter of 2018, we earned two $30 million license fees when AstraZeneca licensed ION532 and ION839 because AstraZeneca had full use of the licenses without any continuing involvement from us.
|
● |
In the third quarter of 2018, we earned a $10 million milestone payment when AstraZeneca initiated a Phase 1 study of IONIS-AZ4-2.5-LRx.
|
● |
In the fourth quarter of 2019, we earned a $10 million milestone payment when AstraZeneca initiated a Phase 1 study of ION839.
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
R&D revenue
|
$
|
28.1
|
$
|
120.7
|
$
|
21.6
|
||||||
Percentage of total revenue
|
3
|
%
|
20
|
%
|
4
|
%
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
R&D revenue
|
$
|
14.3
|
$
|
5.0
|
$
|
67.1
|
||||||
Percentage of total revenue
|
1
|
%
|
1
|
%
|
13
|
%
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
R&D revenue
|
$
|
25.4
|
$
|
1.6
|
$
|
14.8
|
||||||
Percentage of total revenue
|
2
|
%
|
0
|
%
|
3
|
%
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
R&D revenue
|
$
|
0.1
|
$
|
6.6
|
$
|
36.0
|
||||||
Percentage of total revenue
|
0
|
%
|
1
|
%
|
7
|
%
|
● |
In the fourth quarter of 2017, we earned a $45 million license fee when Roche licensed tominersen because Roche had full use of the license without any continuing involvement from us.
|
● |
In the first quarter of 2019, we earned $35 million in milestone payments when Roche dosed the first patient in the Phase 3 study of tominersen in the first quarter of 2019.
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
R&D revenue
|
$
|
57.0
|
$
|
8.3
|
$
|
55.7
|
||||||
Percentage of total revenue
|
5
|
%
|
1
|
%
|
11
|
%
|
● |
R&D services for AKCEA-APO(a)-LRx;
|
● |
R&D services for AKCEA-APOCIII-LRx;
|
● |
API for AKCEA-APO(a)-LRx; and
|
● |
API for AKCEA-APOCIII-LRx.
|
● |
$75 million from the upfront payment;
|
● |
$28.4 million for the premium paid by Novartis for its purchase of our common stock at a premium in the first quarter of 2017; and
|
● |
$5.0 million for the potential premium Novartis would have paid if they purchased our common stock in the future.
|
● |
$64.0 million for the R&D services for AKCEA-APO(a)-LRx;
|
● |
$40.1 million for the R&D services for AKCEA-APOCIII-LRx;
|
● |
$1.5 million for the delivery of AKCEA-APO(a)-LRx API; and
|
● |
$2.8 million for the delivery of AKCEA-APOCIII-LRx API.
|
● |
Akcea completed its R&D services performance obligation for AKCEA-APO(a)-LRx in second quarter of 2019. As such, Akcea recognized all revenue it allocated to its AKCEA-APO(a)-LRx R&D services as of the end of the second quarter of 2019;
|
● |
Akcea completed its R&D services performance obligation for AKCEA-APOCIII-LRx in the fourth quarter of 2019 because Novartis elected to terminate the strategic collaboration for AKCEA-APOCIII-LRx during the period. As a result, Akcea was not required to provide any further R&D services, as such, Akcea recognized all revenue it allocated to its AKCEA-APOCIII-LRx LRx R&D services as of the end of the fourth quarter of 2019;
|
● |
Akcea recognized the amount attributed to AKCEA-APO(a)-LRx API when Akcea delivered it to Novartis in 2017; and
|
● |
Akcea recognized the amount attributed to AKCEA-APOCIII-LRx API when Akcea delivered it to Novartis in May 2018.
|
|
Year Ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
R&D revenue
|
$
|
187.4
|
$
|
50.6
|
$
|
43.4
|
||||||
Percentage of total revenue
|
17
|
%
|
8
|
%
|
8
|
%
|
● |
License of AKCEA-ANGPTL3-LRx;
|
● |
R&D services for AKCEA-ANGPTL3-LRx; and
|
● |
API for AKCEA-ANGPTL3-LRx.
|
● |
$245.6 million for the license of AKCEA-ANGPTL3-LRx;
|
● |
$2.2 million for the R&D services for AKCEA-ANGPTL3-LRx; and
|
● |
$2.2 million for the delivery of AKCEA-ANGPTL3-LRx API.
|
● |
Akcea recognized $245.6 million for the license of AKCEA-ANGPTL3-LRx in the fourth quarter of 2019 because Akcea determined the license Akcea granted to Pfizer was distinct from its other performance obligations and Pfizer had full use of the license without any continuing involvement from Akcea.
|
● |
Akcea is recognizing revenue related to the R&D services for AKCEA-ANGPTL3-LRx as Akcea performs services based on Akcea's effort to satisfy its performance obligation relative to Akcea's total effort expected to satisfy its performance obligation. Akcea expects to satisfy its R&D services performance obligation by mid-2020.
|
● |
Akcea recognized the amount attributed to the API supply for AKCEA-ANGPTL3-LRx when it delivered it to Pfizer in the fourth quarter of 2019.
|
|
Year Ended
December 31, 2019
|
|||
R&D revenue
|
$
|
248.7
|
||
Percentage of total revenue
|
22
|
%
|
|
Year Ended December 31,
|
|||||||
2019
|
2018
|
|||||||
Licensing and other royalty revenue (commercial revenue)
|
$
|
10.2
|
$
|
12.0
|
||||
Percentage of total revenue
|
1
|
%
|
2
|
%
|
2019
|
Ionis Core
|
Akcea Therapeutics
|
Elimination of
Intercompany Activity
|
Total
|
||||||||||||
Revenue:
|
||||||||||||||||
Commercial revenue:
|
||||||||||||||||
SPINRAZA royalties
|
$
|
292,992
|
$
|
—
|
$
|
—
|
$
|
292,992
|
||||||||
Product sales, net
|
—
|
42,253
|
—
|
42,253
|
||||||||||||
Licensing and other royalty revenue
|
12,616
|
10,172
|
(5,583
|
)
|
17,205
|
|||||||||||
Total commercial revenue
|
305,608
|
52,425
|
(5,583
|
)
|
352,450
|
|||||||||||
R&D revenue under collaborative agreements
|
553,038
|
436,118
|
(219,007
|
)
|
770,149
|
|||||||||||
Total segment revenue
|
$
|
858,646
|
$
|
488,543
|
$
|
(224,590
|
)
|
$
|
1,122,599
|
|||||||
Total operating expenses
|
$
|
523,207
|
$
|
450,469
|
$
|
(216,960
|
)
|
$
|
756,716
|
|||||||
Income (loss) from operations
|
$
|
335,439
|
$
|
38,074
|
$
|
(7,630
|
)
|
$
|
365,883
|
2018
|
Ionis Core
|
Akcea Therapeutics
|
Elimination of
Intercompany Activity
|
Total
|
||||||||||||
Revenue:
|
||||||||||||||||
Commercial revenue:
|
||||||||||||||||
SPINRAZA royalties
|
$
|
237,930
|
$
|
—
|
$
|
—
|
$
|
237,930
|
||||||||
TEGSEDI product sales, net
|
—
|
2,237
|
—
|
2,237
|
||||||||||||
Licensing and other royalty revenue
|
2,755
|
12,000
|
—
|
14,755
|
||||||||||||
Total commercial revenue
|
240,685
|
14,237
|
—
|
254,922
|
||||||||||||
R&D revenue under collaborative agreements
|
401,259
|
50,630
|
(107,137
|
)
|
344,752
|
|||||||||||
Total segment revenue
|
$
|
641,944
|
$
|
64,867
|
$
|
(107,137
|
)
|
$
|
599,674
|
|||||||
Total operating expenses
|
$
|
380,212
|
$
|
295,683
|
$
|
(14,849
|
)
|
$
|
661,046
|
|||||||
Income (loss) from operations
|
$
|
261,732
|
$
|
(230,816
|
)
|
$
|
(92,288
|
)
|
$
|
(61,372
|
)
|
2017
|
Ionis Core
|
Akcea Therapeutics
|
Elimination of
Intercompany Activity
|
Total
|
||||||||||||
Revenue:
|
||||||||||||||||
Commercial revenue:
|
||||||||||||||||
SPINRAZA royalties
|
$
|
112,540
|
$
|
—
|
$
|
—
|
$
|
112,540
|
||||||||
Licensing and other royalty revenue
|
7,474
|
—
|
—
|
7,474
|
||||||||||||
Total commercial revenue
|
120,014
|
—
|
—
|
120,014
|
||||||||||||
R&D revenue under collaborative agreements
|
405,171
|
43,401
|
(54,407
|
)
|
394,165
|
|||||||||||
Total segment revenue
|
$
|
525,185
|
$
|
43,401
|
$
|
(54,407
|
)
|
$
|
514,179
|
|||||||
Total operating expenses
|
$
|
373,788
|
$
|
163,871
|
$
|
(54,527
|
)
|
$
|
483,132
|
|||||||
Income (loss) from operations
|
$
|
151,397
|
$
|
(120,470
|
)
|
$
|
120
|
$
|
31,047
|
Total Assets
|
Ionis Core
|
Akcea Therapeutics
|
Elimination of
Intercompany Activity
|
Total
|
||||||||||||
December 31, 2019
|
$
|
3,478,081
|
$
|
599,250
|
$
|
(844,219
|
)
|
$
|
3,233,112
|
|||||||
December 31, 2018
|
$
|
2,975,491
|
$
|
365,261
|
$
|
(672,968
|
)
|
$
|
2,667,784
|
2019 Quarters
|
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
||||||||||||
Revenue
|
$
|
297,214
|
$
|
163,813
|
$
|
167,892
|
$
|
493,680
|
||||||||
Operating expenses
|
$
|
175,679
|
$
|
182,640
|
$
|
165,369
|
$
|
233,028
|
||||||||
Income (loss) from operations
|
$
|
121,535
|
$
|
(18,827
|
)
|
$
|
2,523
|
$
|
260,652
|
|||||||
Net income (loss)
|
$
|
90,884
|
$
|
(10,012
|
)
|
$
|
18,432
|
$
|
203,957
|
|||||||
Net income (loss) attributable to Ionis Pharmaceuticals, Inc. common stockholders
|
$
|
84,443
|
$
|
(876
|
)
|
$
|
26,163
|
$
|
184,415
|
|||||||
Basic net income (loss) per share (1) (2)
|
$
|
0.63
|
$
|
(0.01
|
)
|
$
|
0.19
|
$
|
1.31
|
|||||||
Diluted net income (loss) per share (1) (3)
|
$
|
0.62
|
$
|
(0.01
|
)
|
$
|
0.18
|
$
|
1.28
|
2018 Quarters
|
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
||||||||||||
Revenue
|
$
|
144,419
|
$
|
117,747
|
$
|
145,395
|
$
|
192,113
|
||||||||
Operating expenses
|
$
|
147,720
|
$
|
168,028
|
$
|
163,967
|
$
|
181,331
|
||||||||
Income (loss) from operations
|
$
|
(3,301
|
)
|
$
|
(50,281
|
)
|
$
|
(18,572
|
)
|
$
|
10,782
|
|||||
Net income (loss)
|
$
|
(10,812
|
)
|
$
|
(56,573
|
)
|
$
|
(20,365
|
)
|
$
|
302,735
|
|||||
Net income (loss) attributable to Ionis Pharmaceuticals, Inc. common stockholders
|
$
|
(1,420
|
)
|
(40,358
|
)
|
(4,559
|
)
|
320,078
|
||||||||
Basic net income (loss) per share (1) (2)
|
$
|
(0.01
|
)
|
$
|
(0.29
|
)
|
$
|
(0.03
|
)
|
$
|
2.32
|
|||||
Diluted net income (loss) per share (1) (3)
|
$
|
(0.01
|
)
|
$
|
(0.29
|
)
|
$
|
(0.03
|
)
|
$
|
2.21
|
(1) |
We computed net income (loss) per share independently for each of the quarters presented. Therefore, the sum of the quarterly net income (loss) per share will not necessarily equal the total for the year.
|
(2) |
As discussed in Note 1, Organization and Significant Accounting Policies, we compute basic net income (loss) per share by dividing the total net income (loss) attributable to our common stockholders by our weighted-average number of common shares outstanding during the period. Our basic net income (loss) per share calculation for each of the quarters in 2019 and 2018 considered our net income for Ionis on a stand-alone basis plus our share of Akcea’s net loss for the period. To calculate the portion of Akcea’s net loss attributable to our ownership, we multiplied Akcea’s loss per share by the weighted average shares we owned in Akcea during the period. As a result of this calculation, our total net income (loss) available to Ionis common stockholders for the calculation of net income (loss) per share is different than net income (loss) attributable to Ionis Pharmaceuticals, Inc. common stockholders in the consolidated statements of operations.
|
Three Months Ended March 31 , 2019
|
Weighted
Average Shares
Owned in Akcea
|
Akcea’s
Net Income
Per Share
|
Ionis’ Portion of
Akcea’s Net Income
|
|||||||||
Common shares
|
68,582
|
$
|
0.35
|
$
|
23,846
|
|||||||
Akcea’s net income attributable to our ownership
|
$
|
23,846
|
||||||||||
Ionis’ stand-alone net income
|
63,697
|
|||||||||||
Net income available to Ionis common stockholders
|
$
|
87,543
|
||||||||||
Weighted average shares outstanding
|
138,582
|
|||||||||||
Basic net income per share
|
$
|
0.63
|
Three Months Ended June 30 , 2019
|
Weighted
Average Shares
Owned in Akcea
|
Akcea’s
Net Loss
Per Share
|
Ionis’ Portion of
Akcea’s Net Loss
|
|||||||||
Common shares
|
70,221
|
$
|
(0.40
|
)
|
$
|
(28,244
|
)
|
|||||
Akcea’s net loss attributable to our ownership
|
$
|
(28,244
|
)
|
|||||||||
Ionis’ stand-alone net income
|
27,311
|
|||||||||||
Net loss available to Ionis common stockholders
|
$
|
(933
|
)
|
|||||||||
Weighted average shares outstanding
|
140,247
|
|||||||||||
Basic net loss per share
|
$
|
(0.01
|
)
|
Three Months Ended September 30 , 2019
|
Weighted
Average Shares
Owned in Akcea
|
Akcea’s
Net Loss
Per Share
|
Ionis’ Portion of
Akcea’s Net Loss
|
|||||||||
Common shares
|
70,221
|
$
|
(0.34
|
)
|
$
|
(23,772
|
)
|
|||||
Akcea’s net loss attributable to our ownership
|
$
|
(23,772
|
)
|
|||||||||
Ionis’ stand-alone net income
|
49,930
|
|||||||||||
Net income available to Ionis common stockholders
|
$
|
26,158
|
||||||||||
Weighted average shares outstanding
|
140,551
|
|||||||||||
Basic net income per share
|
$
|
0.19
|
Three Months Ended December 31 , 2019
|
Weighted
Average Shares
Owned in Akcea
|
Akcea’s
Net Income
Per Share
|
Ionis’ Portion of
Akcea’s Net Income
|
|||||||||
Common shares
|
71,342
|
$
|
0.87
|
$
|
62,243
|
|||||||
Akcea’s net income attributable to our ownership
|
$
|
62,243
|
||||||||||
Ionis’ stand-alone net income
|
121,552
|
|||||||||||
Net income available to Ionis common stockholders
|
$
|
183,795
|
||||||||||
Weighted average shares outstanding
|
140,583
|
|||||||||||
Basic net income per share
|
$
|
1.31
|
Three Months Ended March 31 , 2018
|
Weighted
Average Shares
Owned in Akcea
|
Akcea’s
Net Loss
Per Share
|
Ionis’ Portion of
Akcea’s Net Loss
|
|||||||||
Common shares
|
45,448
|
$
|
(0.44
|
)
|
$
|
(19,997
|
)
|
|||||
Akcea’s net loss attributable to our ownership
|
$
|
(19,997
|
)
|
|||||||||
Ionis’ stand-alone net income
|
18,785
|
|||||||||||
Net loss available to Ionis common stockholders
|
$
|
(1,212
|
)
|
|||||||||
Weighted average shares outstanding
|
125,330
|
|||||||||||
Basic net loss per share
|
$
|
(0.01
|
)
|
Three Months Ended June 30 , 2018
|
Weighted
Average Shares
Owned in Akcea
|
Akcea’s
Net Loss
Per Share
|
Ionis’ Portion of
Akcea’s Net Loss
|
|||||||||
Common shares
|
60,832
|
$
|
(0.72
|
)
|
$
|
(43,814
|
)
|
|||||
Akcea’s net loss attributable to our ownership
|
$
|
(43,814
|
)
|
|||||||||
Ionis’ stand-alone net income
|
5,882
|
|||||||||||
Net loss available to Ionis common stockholders
|
$
|
(37,932
|
)
|
|||||||||
Weighted average shares outstanding
|
128,712
|
|||||||||||
Basic net loss per share
|
$
|
(0.29
|
)
|
Three Months Ended September 30 , 2018
|
Weighted
Average Shares
Owned in Akcea
|
Akcea’s
Net Loss
Per Share
|
Ionis’ Portion of
Akcea’s Net Loss
|
|||||||||
Common shares
|
65,538
|
$
|
(0.73
|
)
|
$
|
(47,789
|
)
|
|||||
Akcea’s net loss attributable to our ownership
|
$
|
(47,789
|
)
|
|||||||||
Ionis’ stand-alone net income
|
43,226
|
|||||||||||
Net loss available to Ionis common stockholders
|
$
|
(4,563
|
)
|
|||||||||
Weighted average shares outstanding
|
137,346
|
|||||||||||
Basic net loss per share
|
$
|
(0.03
|
)
|
Three Months Ended December 31 , 2018
|
Weighted
Average Shares
Owned in Akcea
|
Akcea’s
Net Loss
Per Share
|
Ionis’ Portion of
Akcea’s Net Loss
|
|||||||||
Common shares
|
67,130
|
$
|
(0.79
|
)
|
$
|
(53,219
|
)
|
|||||
Akcea’s net loss attributable to our ownership
|
$
|
(53,219
|
)
|
|||||||||
Ionis’ stand-alone net income
|
372,913
|
|||||||||||
Net income available to Ionis common stockholders
|
$
|
319,694
|
||||||||||
Weighted average shares outstanding
|
137,699
|
|||||||||||
Basic net income per share
|
$
|
2.32
|
(3) |
We had net income available to Ionis common stockholders for the following periods. As a result, we computed diluted net income per share using the weighted-average number of common shares and dilutive common equivalent shares outstanding during those periods.
|
Three Months Ended March 31, 2019
|
Income
(Numerator)
|
Shares
(Denominator)
|
Per-Share
Amount
|
|||||||||
Net income available to Ionis common stockholders
|
$
|
87,543
|
138,582
|
$
|
0.63
|
|||||||
Effect of dilutive securities:
|
||||||||||||
Shares issuable upon exercise of stock options
|
—
|
2,252
|
||||||||||
Shares issuable upon restricted stock award issuance
|
—
|
665
|
||||||||||
Shares issuable related to our ESPP
|
—
|
38
|
||||||||||
Shares issuable related to our 1 percent convertible notes
|
—
|
—
|
||||||||||
Income available to Ionis common stockholders, plus assumed conversions
|
$
|
87,543
|
141,537
|
$
|
0.62
|
Three Months Ended September 30, 2019
|
Income
(Numerator)
|
Shares
(Denominator)
|
Per-Share
Amount
|
|||||||||
Net income available to Ionis common stockholders
|
$
|
26,158
|
140,551
|
$
|
0.19
|
|||||||
Effect of dilutive securities:
|
||||||||||||
Shares issuable upon exercise of stock options
|
—
|
1,993
|
||||||||||
Shares issuable upon restricted stock award issuance
|
—
|
844
|
||||||||||
Shares issuable related to our ESPP
|
—
|
20
|
||||||||||
Shares issuable related to our 1 percent convertible notes
|
—
|
—
|
||||||||||
Income available to Ionis common stockholders, plus assumed conversions
|
$
|
26,158
|
143,408
|
$
|
0.18
|
Three Months Ended December 31, 2019
|
Income
(Numerator)
|
Shares
(Denominator)
|
Per-Share
Amount
|
|||||||||
Net income available to Ionis common stockholders
|
$
|
183,795
|
140,583
|
$
|
1.31
|
|||||||
Effect of dilutive securities:
|
||||||||||||
Shares issuable upon exercise of stock options
|
—
|
1,467
|
||||||||||
Shares issuable upon restricted stock award issuance
|
—
|
848
|
||||||||||
Shares issuable related to our ESPP
|
—
|
18
|
||||||||||
Shares issuable related to our 0.125 percent convertible notes
|
644
|
860
|
||||||||||
Shares issuable related to our 1 percent convertible notes
|
12,046
|
9,527
|
||||||||||
Income available to Ionis common stockholders, plus assumed conversions
|
$
|
196,485
|
153,303
|
$
|
1.28
|
Three Months Ended December 31, 2018
|
Income
(Numerator)
|
Shares
(Denominator)
|
Per-Share
Amount
|
|||||||||
Net income available to Ionis common stockholders
|
$
|
319,694
|
137,699
|
$
|
2.32
|
|||||||
Effect of dilutive securities:
|
||||||||||||
Shares issuable upon exercise of stock options
|
—
|
1,254
|
||||||||||
Shares issuable upon restricted stock award issuance
|
—
|
636
|
||||||||||
Shares issuable related to our ESPP
|
—
|
7
|
||||||||||
Shares issuable related to our 1 percent convertible notes
|
10,745
|
10,260
|
||||||||||
Income available to Ionis common stockholders, plus assumed conversions
|
$
|
330,439
|
149,856
|
$
|
2.21
|
|
• |
the transaction is approved by the board of directors before the date the interested stockholder attained that status;
|
|
• |
upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction
commenced; or
|
|
• |
on or after the date the business combination is approved by the board and authorized at a meeting of stockholders by at least 66-2/3% of the outstanding voting stock that is not owned by the interested stockholder.
|
|
• |
permit our board of directors to issue up to 15,000,000 shares of Preferred Stock, with any rights, preferences and privileges as they may designate;
|
|
• |
provide that the authorized number of directors shall be fixed exclusively by the board of directors;
|
|
• |
provide that the board of directors or any individual director may only be removed with cause by the affirmative vote of the holders of at least a majority of the outstanding common stock or without cause by
the affirmative vote of the holders of at least 66-2/3% of the voting power of all of our then outstanding common stock;
|
|
• |
provide that all vacancies, including newly created directorships, may, except as otherwise required by law or subject to the rights of holders of preferred stock as designated from time to time, be filled
by the affirmative vote of a majority of directors then in office, even if less than a quorum, unless the board of directors determines by resolution that any such vacancies or newly created directorships shall be filled by
stockholders;
|
|
• |
classifies our board of directors into three classes;
|
|
• |
require that any action to be taken by our stockholders must be effected at a duly called annual or special meeting of stockholders and not be taken by written consent or electronic transmission;
|
|
• |
provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide notice in writing in a
timely manner and also specify requirements as to the form and content of a stockholder’s notice;
|
|
• |
do not provide for cumulative voting rights (therefore allowing the holders of a majority of the shares of Common Stock entitled to vote in any election of directors to elect all of the directors standing
for election, if they should so choose); and
|
|
• |
provide that special meetings of our stockholders may be called only by the chairman of the board, our Chief Executive Officer or by the board of directors pursuant to a resolution adopted by a
majority of the total number of authorized directors (whether or not there exists any vacancies).
|
|
Re: |
AKCEA-ANGPTL3-LRx License Agreement
|
By:/s/Damien McDevitt
|
|
Name:
|
Damien McDevitt
|
|
Title:
|
Interim Chief Executive Officer
|
|
By:/s/Morris J. Birnbaum
|
|
Name:
|
Morris J. Birnbaum
|
|
Title:
|
SVP-CSO, Internal Medicine
|
|
|
/s/ ERNST & YOUNG LLP
|
|
|
San Diego, California
|
|
March 2, 2020
|
|
1.
|
I have reviewed this Annual Report on Form 10-K of Ionis Pharmaceuticals, Inc.;
|
2.
|
Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
|
3.
|
Based on my knowledge, the consolidated financial statements, and other financial information included in this annual report, fairly present in
all material respects the financial condition, consolidated results of operations and consolidated cash flows of the registrant as of, and for, the periods presented in this annual report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most
recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting,
to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control
over financial reporting.
|
Dated: March 2, 2020
|
|
|
|
/s/ BRETT P. MONIA
|
|
Brett P. Monia, Ph.D.
|
|
Chief Executive Officer
|
|
1.
|
I have reviewed this Annual Report on Form 10-K of Ionis Pharmaceuticals, Inc.;
|
2.
|
Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
|
3.
|
Based on my knowledge, the consolidated financial statements, and other financial information included in this annual report, fairly present in
all material respects the financial condition, consolidated results of operations and consolidated cash flows of the registrant as of, and for, the periods presented in this annual report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most
recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting,
to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control
over financial reporting.
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Dated: March 2, 2020
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/s/ ELIZABETH L. HOUGEN
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Elizabeth L. Hougen
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Chief Financial Officer
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1. |
The Company’s Annual Report on Form 10-K for the year ended December 31, 2019, to which this Certification is attached as Exhibit 32.1 (the “Annual Report”), fully
complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended; and
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2. |
The information contained in the Annual Report fairly presents, in all material respects, the financial condition of the Company at the end of the period covered by
the Annual Report and the results of operations of the Company for the period covered by the Annual Report.
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/s/ BRETT P. MONIA
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/s/ ELIZABETH L. HOUGEN
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Brett P. Monia, Ph.D.
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Elizabeth L. Hougen
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Chief Executive Officer
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Chief Financial Officer
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