Ionis Pharmaceuticals Inc Q2 FY2024 Earnings Call

Good morning, and welcome to the Ionis Second Quarter 2024 Financial Results Conference Call. As a reminder, this call is being recorded. At this time, I would like to turn the call over to Wade Walke, Senior Vice President of Investor Relations, to lead off the call. Please begin.

Thank you, Danielle. Before we begin, I encourage everyone to go to the Investors section of the analyst website to view the press release and related financial tables that we will be discussing today, including a reconciliation of GAAP to non-GAAP financials. We believe non-GAAP financial results better represent the economics of our business and how we manage our business. We've also posted slides on our website that accompany today's call. With me on this morning's call are Brett Monia, our Chief Executive Officer; Richard Geary, Chief Development Officer; Kyle Jenne, Chief Global Project Strategy Officer; and Beth Hougen, our Chief Financial Officer. Eric Swayze, Executive Vice President of Research; Eugene Schneider, Chief Clinical Development Officer; and Jonathan Birchall, Chief Commercial Officer, will also join us for the Q&A portion of our call. I'd like to draw your attention to Slide 3 in our presentation, which contains our forward-looking language statement. During this call, we will be making forward-looking language statements that are based on our current expectations and beliefs. These statements are subject to certain risks and uncertainties, and our actual results may differ materially. I encourage you to consult the risk factors contained in our SEC filings for additional detail. And with that, I'll turn the call over to Brett.

Thanks, Wade. Good morning, everyone, and thanks for joining us on today's call. We've achieved a great deal during the first half of this year, delivering many significant milestones as we continue to execute on our vision to bring better features to people with serious diseases. Today, Ionis discovered and developed medicines reaching more and more people, bolstered by two recent launches, WAINUA for people with hereditary ATTR polyneuropathy in the U.S., and QALSODY, the first approved treatment for a genetic cause of ALS currently available in the U.S. and now available in Europe. With the progress we're making across our pipeline, our medicines are well positioned to continue reaching more and more patients for years to come. The U.S. launch of our first Ionis co-branded medicine WAINUA is progressing well with AstraZeneca, and we expect to bring WAINUA to even more patients across the globe with the recent approval in Canada, and anticipated approval decision in Europe later this year and with additional regulatory submissions completed in many other geographies with more coming. Today, we are even more confident in the potential of WAINUA to address the larger ATTR cardiomyopathy population. As the largest study ever conducted in this patient group, our ongoing landmark CARDIO-TTRansform trial is on track to deliver the most comprehensive and the most robust data set in this patient population. We believe WAINUA has the potential to be the treatment of choice for the global ATTR population. Our confidence is based on WAINUA's strong efficacy profile as demonstrated in hereditary ATTR polyneuropathy and the freedom of simple at-home self-administration together with AstraZeneca's global cardiovascular commercialization leadership, along with our leadership in ATTR amyloidosis. As the renewal launch accelerates, we're also preparing for the launch of Olezarsen in FCS later this year, our first independent launch of a wholly owned medicine for Ionis. Olezarsen represents one of the most meaningful opportunities in our pipeline today as we prepare to first launch in FCS, a severe rare disease with no approved treatments in the U.S. and then to expand to the much larger sHTG patient population. Our NDA submission for Olezarsen was recently accepted with priority review. Our PDUFA date is set for December 19, and we're ready to bring this groundbreaking medicine to people with FCS. We also recently completed enrollment for our sHTG Phase 3 program, keeping us on track for data in the second half of next year. Based on our significant first-mover advantage and our positive results demonstrated to date, if approved, we believe Olezarsen could be the standard of care for both FCS and sHTG. We're building on the capabilities we've established for WAINUA and Olezarsen in preparation for our anticipated launch of Tominersen for HAE prophylaxis next year. In our comprehensive clinical program, Donidalorsen has demonstrated strong evidence of meaningful benefit across multiple measures of disease with a favorable safety and tolerability profile. These data together with the potential for monthly or every two months self-administration using an auto-injector strengthen our belief that if approved, Donidalorsen has the potential to advance the treatment paradigm for people living with HAE. With positive Phase 3 data in hand, we expect to submit the NDA for Donidalorsen soon as we look to independently bring Donidalorsen to patients in the U.S. Outside the U.S., our commercial partner Otsuka is preparing to file for marketing approval in Europe later this year. With our recently expanded license agreement, Otsuka is also working to bring Donidalorsen to people with HAE in the Asia-Pacific region. Following WAINUA, Olezarsen, and Donidalorsen, our next wave of wholly owned opportunities includes our program for Angelman Syndrome. Based on the positive results from the HALOS Phase 1/2 study that we presented last week, we are advancing this potentially transformational medicine into a Phase 3 study, which we anticipate will begin in the first half of next year. ION582 is positioned to become the cornerstone of our wholly owned neurology franchise, which today includes five wholly owned medicines in clinical development with more to come by the end of the year. Our accomplishments so far this year and the investments we're making move us closer to achieving our goal of bringing a steady cadence of new transformational medicines to patients for years to come, and generating next-level value for all Ionis stakeholders. With that, I'll turn the call over to Richard to discuss our recent pipeline progress and preview key upcoming events. Next, Kyle will review the WAINUA launch and our launch plans in progress for Olezarsen and Donidalorsen. And Beth will review our financial results. I'll then wrap up things before taking your questions. With that, over to Richard.

Thank you, Brett. We are pleased that our pipeline delivered many important achievements to date this year. With WAINUA reaching more and more people with hereditary ATTR polyneuropathy, I am proud of all that Ionis team has accomplished to discover and develop this important new medicine and bring it to patients in need. Recent ATTR cardiomyopathy data further reinforces our confidence in the potential of WAINUA to improve cardiovascular outcomes in this estimated worldwide patient population of approximately 300,000 to 500,000. With over 1,400 patients enrolled, our ongoing CARDIO-TTRansform study is the largest and most comprehensive study ever conducted in ATTR cardiomyopathy. As a result, we expect the data we generate will enable physicians and payers to make informed treatment decisions in this dynamic treatment landscape. In addition, as part of our Phase 3 program, we're conducting advanced cardiac imaging sub-studies, including an MRI sub-study and a cardiac imaging sub-study, which will generate valuable data about the potential benefits of WAINUA in cardiomyopathy patients. We were delighted that our recent Olezarsen NDA submission was accepted by the FDA for priority review, highlighting the potential of this medicine to make a profound difference in the lives of patients. Our submission was based on the positive Phase 3 results in FCS that we presented and published earlier this year. In the Phase 3 BALANCE study in patients with FCS, Olezarsen showed substantial and durable triglyceride reductions. Importantly, for patients, physicians, and payers alike, Olezarsen demonstrated substantial and clinically meaningful reductions in acute pancreatitis attacks, a remarkable 84% reduction in hospitalizations, and a favorable safety and tolerability profile. We look forward to our upcoming December PDUFA date and, assuming approval, bringing Olezarsen to people with FCS who currently have no approved treatments in the U.S. We are also developing Olezarsen for the much larger severe triglyceride patient population, and we recently completed enrollment in our extensive Phase 3 program for sHTG with more than 2,500 patients enrolled across three studies. This puts us on track for data in the second half of next year, maintaining our multiyear first-mover advantage for this wholly owned blockbuster opportunity. Following closely behind Olezarsen is Donidalorsen for the prophylactic treatment of hereditary angioedema. We recently presented and published in the New England Journal of Medicine positive Phase 3 data from OASIS-HAE, our placebo-controlled trial. Additionally, we also presented positive data from OASISplus, our trial that includes an open-label cohort for patients rolling over from the Phase 3 study and a separate cohort that we refer to as the SWITCH study. Donidalorsen treatment significantly reduced HAE attacks. The reduction in HAE attacks translated into significant and clinically meaningful improvements in quality of life across multiple validated measures and high levels of disease control in a vast majority of patients. With longer-term treatment, patients improve further on all these measures. Additionally, as of our most recent data cutoff in February, 98% of patients remain in the study. These positive data were further bolstered by the encouraging SWITCH results. The SWITCH study through week 17 showed a substantial reduction in the HAE attack rate with Donidalorsen treatment compared to baseline on their previous treatment. Donidalorsen treatment also resulted in improved quality of life measures and increased disease control. Importantly, more than 80% of patients surveyed reported a preference for Donidalorsen over their prior prophylactic treatment. Nearly 90% of SWITCH study patients remain in study as of the data cutoff in February. In addition to strong clinical results, Donidalorsen offers the potential for simple, monthly, or every two-month self-administration via an auto-injector. Based on these data, we believe Donidalorsen could become a preferred prophylactic treatment for people with HAE. Our NDA, which we plan to submit soon, will include data from OASIS-HAE, OASISplus, OLE study SWITCH, and our Phase 2 study. Outside the U.S., Otsuka is preparing to submit for marketing approval in Europe later this year, and with the recent expansion of our license agreement, Otsuka also plans to bring Donidalorsen to patients in the Asia-Pacific region. The rest of our rich Phase 3 pipeline is also advancing, positioning us to continue delivering a steady cadence of potentially transformational medicines to patients. We recently completed enrollment in the pivotal arm of our zilganersen study for Alexander Disease, keeping us on track for a Phase 3 readout next year. From GSK, we recently completed enrollment in the Phase 3 program for Bepirovirsen for chronic hepatitis B, which keeps the program on track for data in 2026. Coming right behind these programs, we have our next wave of medicines including a number of medicines to treat both rare and broad neurological diseases, five of which are wholly owned. We expect our wholly owned pipeline to expand later this year with two more medicines from our neuro disease franchise entering clinical development. ION582, our medicine for Angelman Syndrome, has transformational potential for the tens of thousands of people living with this serious rare disorder, who are in need of disease-modifying treatments. For this reason, ION582 is poised to become the cornerstone of our wholly-owned neurology pipeline. We're encouraged; I recently presented positive early results from the HALOS study of ION582 and people with Angelman syndrome. In this study, we demonstrated evidence of consistent and meaningful improvement in all key functional areas across multiple assessments. This includes 97% of participants showing clinically meaningful improvement in overall Angelman syndrome symptoms on the SAS CGI assessment. Improvements in measures of communication, cognition, and motor function exceeded natural history on the Bayley-4, Vineland-3, and ORCA assessment. Additionally, we observed consistent improvements across ages and genotypes. We saw favorable safety and tolerability at all dose levels, including no discontinuations or adverse events that were considered related to the study drug. Based on these positive data, we plan to advance ION582 into a well-controlled Phase 3 study in the first half of next year. Alongside the positive Phase 1/2 data for Angelman Syndrome, several recent events have also occurred in our mid-stage pipeline. We were pleased to present positive Phase 2 data at EASL for ION224, our medicine targeting DGAT2 for the treatment of Metabolic Dysfunction-Associated Steatohepatitis or MASH. Additionally, based on the encouraging Phase 1b data from IONIS-MAPTRx, also known as BIIB080, that were presented late last year, Biogen recently announced that they amended the ongoing Phase 2 study with the goal to accelerate a potential proof-of-concept outcome. As a result of this change, they are now projecting data in 2026. Also, we and our partners recently discontinued development for ION541 targeting ataxin-2 for ALS and IONIS-FB-LRx for geographic atrophy. Both programs showed good target engagement and favorable safety but did not meet their primary efficacy endpoints. Importantly, Roche continues to advance the IONIS-FB-LRx IgA Nephropathy Phase 3 study that they initiated last year based on positive Phase 2 data. Looking ahead, we have several important milestones still to come this year. These include presenting new Phase 2 open-label extension data for Donidalorsen and data from the DEVOTE study, which is evaluating a higher dose of SPINRAZA, as well as anticipated regulatory approvals and launches for WAINUA, Olezarsen, and regulatory filings for Donidalorsen. With that, I'll turn the call over to Kyle.

Thank you, Richard. We are pleased with the initial results of the WAINUA launch with AstraZeneca following the U.S. approval at the end of last year, including the significant growth quarter-over-quarter with an estimated 40,000 patients worldwide and fewer than 20% of patients on an approved treatment, people with hereditary ATTR polyneuropathy remain underdiagnosed and largely underserved. As a result, a high unmet need remains that we and AstraZeneca are uniquely positioned to address. The combined team is working together seamlessly with a shared goal to make WAINUA the preferred choice for patients with ATTR polyneuropathy. We continue to see good uptake among patients in the second quarter with an encouraging mix of new patient starts, including some who were new to this class of medicine, some switching from other treatments, and some using WAINUA as an add-on treatment to their existing therapy. Prescribers and patients are recognizing WAINUA's strong clinical profile, and patients value the ability to easily self-administer WAINUA from their homes. We expect to reach a growing number of patients as we continue to educate prescribers about the value that WAINUA brings. With our increased confidence in our ongoing CARDIO-TTRansform study for ATTR cardiomyopathy, we and AstraZeneca are progressing our pre-commercialization activities and investments to support the potential substantial opportunity WAINUA represents. We are leveraging and building upon our efforts for the WAINUA launch to prepare for our upcoming independent launches of Olezarsen and Donidalorsen. As Richard mentioned, we are developing Olezarsen for two indications, the rare FCS indication and broader sHTG indication with anticipated first-mover advantage in both settings. We are pleased to receive positive feedback from key opinion leaders on the Phase 3 FCS data that we presented at ACC. They were particularly impressed with the reduction in acute pancreatitis attacks and the substantial reductions in hospitalizations and inpatient hospital days. We expect that these data will also be important in securing access from payers. In addition, the U.S. expanded access program for Olezarsen is in place, enabling patients to have access to treatment ahead of potential approval. We are putting the final touches on our independent launch plans to bring Olezarsen to patients as soon as possible after anticipated approval. Our medical affairs team has been meeting with physicians and working to improve disease awareness through disease education. Earlier this year, we hired our first Ionis National Sales Director. Now, with the December 19 PDUFA date set, we have recently hired and are now training our customer-facing team with extensive rare disease experience in preparation for the FCS launch. To bolster our field team's efforts, we are deploying a tailored omnichannel strategy to further enhance our relationships with patients and healthcare professionals. Finally, we are building a world-class patient and caregiver support team to provide a seamless customer experience to help patients initiate treatment and remain on therapy long-term. We plan to further scale our commercial capabilities as we prepare for the sHTG indication to realize the full blockbuster potential of Olezarsen. Donidalorsen for the prophylactic treatment of HAE is our next planned launch after Olezarsen. Based on the positive results we have seen in the comprehensive development program, we are excited about what Donidalorsen could mean for people with HAE. HAE is a well-defined patient population with an estimated 20,000 people affected in the U.S. and Europe. While prophylactic treatment in the U.S. is well accepted by patients and physicians, there continues to be a need and the market continues to grow. Outside the U.S., acute therapies have historically been the standard of care. However, prophylactic treatments are gaining ground, especially in Europe. Many people with HAE are unsatisfied with current treatments and are looking for the option that reduces the frequency and severity of attacks while also offering good tolerability and convenience. This disease typically appears in childhood, so patients have to manage their disease throughout most of their lives. As a result, patients have a history of switching treatments seeking to find the best therapy for them. We believe Donidalorsen could be a preferred prophylactic treatment for both patients new to therapy and patients currently on available therapy. With strong clinical data, including Switch data and the simplicity of monthly or every two-month self-administration via an auto-injector, we believe Donidalorsen combines the attributes that people with HAE are looking for in a single attractive treatment, assuming approval. Today, I'm pleased to share that we are right where we should be in preparing for our upcoming launches, our infrastructure to support commercialization is in place, and we will be ready to begin delivering our medicines to people in need as these new therapies come to the market. Now I'll turn it over to Beth.

Thank you, Kyle. Our results in the second quarter and first half of this year reflect the excellent progress we've made toward our goal to bring a steady cadence of medicine to the market. We continue to generate meaningful revenue while investing our capital to independently launch several new medicines over the next few years that have a combined multibillion-dollar peak sales potential. We are also investing in advancing our next wave of wholly owned medicines, which continued to make great progress in the first half of this year. In addition to our recent pipeline achievements, we delivered strong financial results, keeping us on track to achieve our financial guidance. We earned revenues of $225 million and $345 million for the second quarter and first half of this year, respectively. SPINRAZA remains the primary source of our commercial revenue with $57 million and $95 million of royalties in the second quarter and year-to-date. Notably, SPINRAZA product sales increased 25% from the first quarter to the second quarter due to growth from both the U.S. and ex-U.S. markets. Additionally, in the second quarter of the WAINUA launch, product sales were $60 million, bringing year-to-date sales to $21 million. As a result, our WAINUA royalty revenue increased quarter-over-quarter to $4 million for the second quarter and $5 million for the year-to-date period. R&D revenue also increased in the second quarter and year-to-date reflecting the value that our pipeline and technology continue to generate. As planned, our non-GAAP operating expenses for the second quarter and year-to-date increased over the same period last year, driven by higher SG&A expenses. Our SG&A expenses increased 46% and 31% for the second quarter and first half of this year, respectively, as we continue to make investments to prepare for our upcoming independent launches of Olezarsen and Donidalorsen. Notably, we built out our commercial team, including our field organization, and they are enthusiastically preparing for the FCS launch. Our SG&A expenses also included our minority portion of WAINUA U.S. launch expenses. As planned, our R&D expenses decreased slightly for the second quarter and were flat for the first half of this year compared to the same period last year. Our results for the first half of the year keep us on track to meet our 2024 financial guidance, including revenue of more than $575 million, of which approximately $175 million will come from non-cash amortization of partner payments we received in prior years. Looking to the second half of this year, we expect our total revenue to be slightly lower compared to the first half and weighted more to Q4. We expect commercial revenue to increase since the launch of the ramp for WAINUA and QALSODY and from higher anticipated SPINRAZA royalties as our tiered royalty rate increases. Additionally, we expect our R&D revenue, which often fluctuates from quarter to quarter due to the timing of achieving various collaboration milestones, to be lower in the second half of the year. Importantly, however, we still have the opportunity to earn sizable payments, including a $30 million milestone payment from AstraZeneca if WAINUA is approved in the EU. We continue to project our full-year 2024 operating expenses to increase by a mid- to high-single-digit percentage compared to 2023, excluding the impact of one-time costs from last year. Similar to the first half of this year, the increase will be driven primarily by sales and marketing expenses as we prepare for our back-to-back independent launches of Olezarsen and Donidalorsen. We are on track to end the year with $1.7 billion in cash as we continue to make strategic investments in the substantial opportunities before us today, including our late-stage programs and our next wave of innovative medicines. As you can see, we delivered a strong second quarter and first half. Before I turn it back to Brett, though, I'd like to provide you with a look beyond this year to our path to revenue growth and increasing value as we deliver on our goal to bring more medicines to more people. With our strong development and regulatory progress, Ionis is at a critical inflection point. We have several near-term commercial opportunities with significant potential to help patients in need. In parallel, we are advancing our next wave of potentially transformational medicines and our technology. As a result, we plan to continue to strategically invest our capital resources to ensure we unlock the full potential of our promising near- and longer-term portfolio. Our investments are focused in four key areas: First, in our go-to-market activities, enabling us to realize the full value of our medicines, which includes investing in our upcoming independent launches for Olezarsen and Donidalorsen. Our expenses in this area also include our WAINUA cost share with AstraZeneca for the hereditary ATTR polyneuropathy launch in the U.S. As we approach the anticipated Olezarsen launch for the broader severe high triglyceride population, we will scale our capabilities and increase our go-to-market expenses to support the larger opportunity. As we and AstraZeneca approach a potential ATTR cardiomyopathy launch for WAINUA, our expenses will increase consistent with the much larger cardiomyopathy opportunity. Importantly, our planned investments are rightsized for the combined multibillion-dollar revenue potential that these important medicines represent. Second, we continue to advance our late-stage pipeline. All of our ongoing large Phase 3 studies are fully enrolled with more than 4,000 patients in all and are currently in the heaviest period of investment. We expect these investments to fuel our continued value generation and revenue growth as the data read out and we bring new medicines to patients over the next couple of years. Third, we are increasing our investments in our next wave of medicines, including development and pre-commercialization expenses for our growing wholly owned pipeline of potentially groundbreaking neurology medicines, such as ION582 for Angelman syndrome. Finally, we are investing in cutting-edge technologies to ensure we continue to deliver innovative medicines with competitive profiles well into the future. So as you can see, we are strategically investing our capital toward growth opportunities. Importantly, we expect our investments to power strong revenue growth and positive cash flow as our medicines reach more and more patients in need, positioning us to deliver next-level value for all Ionis stakeholders for years to come. And with that, I'll turn the call back over to Brett.

Thank you, Beth. As just summarized, we have made great progress in the first half of this year. In the second quarter alone, we've achieved a great deal with many important successes, which include a continued strong start for the WAINUA launch for hereditary ATTR polyneuropathy in the United States, approval in Canada, and submissions under review in many additional territories. Positive FCS data for Olezarsen, which we presented at ACC, served as the basis for our NDA submission, which was recently accepted by the FDA with priority review. Positive HAE data for Donidalorsen presented at the recent clinical meeting will be the basis of our upcoming regulatory submissions. We completed enrollment for the Phase 3 Olezarsen sHTG program this past quarter, keeping us on track for data next year. We also presented positive data from the HALOS Phase 1/2 study in people with Angelman syndrome, and we are well along in preparing for our end of Phase 2 meeting with the FDA scheduled for this Fall, with plans to advance this important medicine into Phase 3 development next year. We delivered solid second quarter and first half financial results, keeping us on track to achieve our 2024 financial guidance. Based on the strong progress we've made across our business this year, we are well positioned to continue building on our positive momentum as we execute toward achieving all of our strategic priorities. We've arrived where we are today by being focused on a clear vision and a clear set of strategic objectives which include building and advancing our pipeline and delivering medicines that we can discover and develop directly to patients. Our pipeline is delivering. We achieved multiple marketing approvals and positive key data readouts over the past year, and we are poised to build on the strong momentum in the near term. We prioritized building our wholly owned pipeline and are now advancing several of these medicines towards the market. In parallel, our partner programs are progressing on track with important Phase 3 readouts next year and beyond. We are also focused on extending our leadership position in type therapeutics by expanding and diversifying our technology, further optimizing our capabilities for existing therapeutic areas and opening up new areas for drug discovery. All of this sets us up to continue bringing a steady cadence of new medicine to patients for years to come. We're looking forward to sharing our progress as we build on our recent achievements and accomplish our strategic objectives. And with that, I'll now open the call up for questions. Before moving into the Q&A portion of our meeting, I just ask that our analysts please limit yourselves to a single question as we have quite a long queue. We'd like to get as many people into the queue and ask their questions as much as possible. So with that, Danielle, we'll open it up for questions.

Thank you. We will now begin the question-and-answer session. The first question comes from Akash Tewari from Jefferies. Please go ahead.

Hey, this is Amy on for Akash. Thanks so much for taking our question. So one on ATTR CM. There's been some debate on if you need a certain level of TTR to have a cardioprotective effect. Have you seen anything in your own data around this theory? And do you expect any differences with the silencer approach using in all-cause mortality versus the mortality composite primary endpoint? Finally, do you have the flexibility to change your primary endpoint if needed? Thanks so much.

Thank you, Amy. We do not believe there is any evidence indicating a threshold effect for TTR lowering in relation to benefits for either polyneuropathy or cardiomyopathy endpoints. We are very pleased with the level of TTR reductions observed in our studies for WAINUA related to polyneuropathy. However, I don't think there is credible evidence supporting a specific threshold effect for TTR lowering to demonstrate benefits in either polyneuropathy or cardiomyopathy. Our primary focus is on cardiovascular mortality and hospitalization. We also have secondary endpoints, particularly cardiovascular mortality and composite mortality, both of which we consider very important. Next study or next question.

The next question comes from Myles Minter from William Blair. Please go ahead.

Hi, just on the timing of the CARDIO-TTRansform readout, I mean, is it fair to say that you're at least waiting for data at ESC in London that might have read-through to your trial? And if that is the case, what exactly would you be looking for out of that data set to stick with the decision that you're going to read that out early or just wait until the full 140 weeks up in that study?

Thanks, Myles. We're very pleased with the way the CARDIO-TTRansform study is advancing. We are particularly pleased with the blinded events that we are evaluating for both cardiovascular hospitalizations as well as mortality. It's going very well and is right on track. As the first silencer to read out in this indication, we're very much looking forward to any and all additional data that we can see, which we think will be a very nice read-through to our CARDIO-TTRansform study. As you know, we have the largest, by far, study ever conducted in this patient population. We think that anything we see from other molecules in the silencer trials will provide very good read-throughs to what we expect to see in our study. We are just looking forward to any and all data that comes from future presentations on the silencer class. Next question please.

The next question comes from Mani Foroohar from Leerink Partners. Please go ahead.

Hey guys, you have Ryan on for Mani. Thanks for taking our question. Can you just talk a little bit about any early insights from the WAINUA launch? And how you see that informing a potential strategy in cardiomyopathy? And alongside that, maybe what pre-commercialization activities you guys are undertaking in cardiomyopathy? Thanks.

Yes, thanks for your question. We're very pleased with the early insights we're getting from the WAINUA launch. As Kyle mentioned, we're seeing patients using the new treatment, switching from existing treatments, and having WAINUA added to their current treatment. We're very happy with what we're observing. It’s still early, and this year serves as a foundation for the WAINUA launch. We see significant opportunities when considering the potential patient population for both polyneuropathy and cardiomyopathy, especially given the number of patients who may be underdiagnosed and the relatively small number currently treated. We are encouraged by the prescribing trends from both neurology and cardiology specialists, as well as in the community. This is promising not just for the polyneuropathy launch but also for future indications. However, it's too early to speculate on what may happen with those future indications until we have more data from our comprehensive programs.

Yes, two quick things to add. First, on the payer access side of things, we're seeing payers cover WAINUA very quickly. From the prescription process to the patients actually starting on the drug is going very, very well. This tells us that the right types of patients are being identified and it's also telling us that physicians are justifying the prior authorization process with a sense of urgency, which indicates that these patients need treatment, and they see the value in WAINUA. The second thing I'll just mention is around our patient engagement team. Our team is directly interacting with these patients and getting feedback on a real-time basis. Patients are extremely pleased when they start WAINUA with the ability to self-inject with the auto-injector. It is very well tolerated, very easy to use, and very convenient for those patients, and the profile of WAINUA is really playing out the way that we expected it to in the market. Next question please.

The next question comes from Yanan Zhu from Wells Fargo Securities. Please go ahead.

Great. Thanks for taking our questions. Wondering about what's your takeaway from Roche's recent presentation of their syndrome Phase 2 data at the ASF meeting? And also separately, given the similar development timeline in our Angelman syndrome program and AstraZeneca's program, do you think the FDA will want to apply the same pivotal endpoint to both programs? Or is there a possibility that the agency could allow different primary endpoints based on strength of data?

Thanks, Yanan. I'll take the first question, then I'll ask Eugene to comment on the primary endpoint for Angelman. We are very pleased to see the data that Roche presented on their Angelman's program, particularly because the data further supported our comments in our Phase 1/2 data. Specifically, the rank order of improvements that they reported regarding the magnitude of improvement was exactly what we reported. The biggest magnitude that they reported was in expressive communication, followed by receptive communication, cognition, and then motor function. That's exactly what we reported, which gives us further confidence in our results thus far. We are also pleased with the magnitude of benefit we're seeing compared to their program that looks like we have even better efficacy relative to what Roche presented. However, we were pleased to see their data because of the consistency in subdomain benefit between the two programs. Eugene?

Yes. Regarding the primary endpoint and conversations with the agency, we are certainly looking forward to updating you after we've had our discussions. From our standpoint, this will be driven by data. We certainly believe that the data and consistency of what we see in our Phase 1/2 study gives us a good idea of what we would like to see in a pivotal study, but it's still to be seen what the specific primary endpoint will ultimately be. We'll be happy to provide you an update. There's precedent to have slightly different primary endpoints for two very similar programs. So stay tuned; we'll keep you informed.

Thanks, Eugene. Next question.

The next question comes from Jessica Fye from JPMorgan. Please go ahead.

Hey there. Thanks for taking my question. On the back of the top line HELIOS-B data, what's your latest expectation for whether silencers in TTR cardiomyopathy will mainly be used in combination with stabilizers versus as monotherapy? Thank you.

Yes, I'd be happy to talk to that. This is Kyle. Thanks, Jessica. The data ultimately is going to drive this, we believe. That is a starting point. I think ultimately, it will come down to physicians and patients making a decision around the profile of treatment they want in that decision. Right now, we see it being used in combination, obviously, as hATTR polyneuropathy indication, combined with cardiomyopathy indication for the stabilizers. So we're seeing it happen now. We think that will continue to progress over time. We also believe the data and the way the data plays out will provide justification for physicians to be able to rationalize that to payers whenever they submit these requests and try to get the drugs approved. So I think it's ultimately data that drives this, and it's driven by physicians and patients.

Just to add to that, Jess, we are positioned to have the most comprehensive data set on both primary and secondary endpoints, as well as various subgroups. We will gather significant data regarding key clinical endpoints such as hospitalizations, mortality, six-minute walk tests, biomarkers, and imaging studies. We have multiple imaging studies underway, and we believe that if anyone is going to demonstrate meaningful improvements in combination therapies versus monotherapy across the board, we will be in the best position to do so. As Kyle mentioned, this is a data-driven environment, and we will be well-equipped to collect and share the data necessary to support the use of combination treatments. Next question please.

The next question comes from Allison Bratzel from Piper Sandler. Please go ahead.

Hey, good morning guys. And thanks for taking my question. Maybe one on Pelacarsen, since that Phase 3 data and regulatory filings are coming up next year. Could you just talk to or frame what you'd like to see in that readout? And maybe in general discuss what gives you confidence in the differentiation of this asset? Also, a competitive space color on that or the next-gen program would be helpful. Thank you.

Yes, Allison. The only news on Pelacarsen is really that the study is on track to read out as scheduled next year. Everything is going very well. Our partner, Novartis, is well positioned with first-mover advantage in this first-to-market patient population; there is an enormous patient population. Everything we're seeing in the Phase 3 study is very supportive, and we are set up for a successful outcome. First mover advantage is really significant, and we with Novartis have a substantial lead in the market. Yes, our follow-on program with Novartis is advancing well. I might ask Eric Swayze to comment on how the follow-on program is progressing.

Things are going great. We've been working closely with Novartis, looking at a variety of ways to extend the dosing interval and optimize lowering growth. I'm sure we'll discuss it in times to come as the program advances further, but I can't really say more than that at this time, but I'm very pleased with the progress we've been making on new technologies, siRNAs in particular, and a broad range of other things beyond what would be amenable for the competitive space.

We feel very comfortable that we're going to achieve our objectives with Novartis on a follow-on molecule. Things are going very well. There are obviously a lot of benchmarks out there today, so there's a lot to compare to. We're pleased. Next question please.

The next question comes from Yaron Werber from TD Cowen. Please go ahead.

Great. Thanks for taking my question. I also have just a quick follow-up on WAINUA. As you look at the HELIOS-B data, I'm totally aware that you're probably going to be waiting for the full HELIOS B result. But as you think about with a much powered trial design, where can you potentially differentiate? And how important will that combo data be, just given that overall data landscape?

Thank you, Yaron. As the largest study ever conducted in this patient population by far, we think we have the opportunity to differentiate in several areas. It will be very interesting to see the onset of action for silencers and whether or not our onset of action is going to be similar or faster. The combination data will be very important in this patient population, as will having a broad label, which we expect to have as well. Cardiologists are data-driven, and they're going to need to see data before advocating for combination usage. We believe we're well positioned to have such data. New York heart classifications are going to be very important to see how mild patients are doing compared to moderately ill or severely ill patients. With a well-powered study, we have the potential ability to differentiate across the board. Anything to add to that, Eugene?

No, Brett. You characterized it perfectly. The power really comes from the size of the study and our ability to look at subpopulations, which we are well positioned to do.

Thank you. Next question please.

The next question comes from Jason Gerberry from Bank of America. Please go ahead.

Hey, guys. Thanks for taking my question. I wanted to come back to the CARDIO-TTRansform timing question. It sounds like we're going to get pretty detailed and granular data from Alnylam at ESC in terms of multiple curves on overall mono and subgroups with famous background, including mortality. So it seems like you'll have everything you need to know post-ESC on whether or not the 2025 interim is in the cards. Is it fair for investors to expect a clear message as of the third-quarter update on which way you're going to go as the base case 2026 or whether or not you'll look to a 2025 interim?

Thanks, Jason. So Ionis and our partner, AstraZeneca, have thought about this quite a bit. Our base case remains 40 weeks of treatment, which brings us to mid-2026 if the study were to go to completion. However, we are committed to bringing WAINUA to patients as fast as possible if it makes sense to do so. Certainly, as I mentioned earlier, following up on our blinded events and studies is most important. Any new information we receive from other treatments in our class will be informative for our work. That said, we can't get ahead of regulators. We want to get buying on anything we do with respect to an earlier readout with the FDA and EMA before making any proclamations publicly. So timing is a bit uncertain right now. Rest assured that we and AstraZeneca are working on this very thoughtfully.

The next question comes from Jay Olson from Oppenheimer. Please go ahead.

Hey, congrats on all the progress. Thanks for taking the question. Can you talk about your launch preparation for Olezarsen in FCS? How should we expect the launch uptake and eventual opportunity in FCS? And also the early access program, how many patients you have? Will those patients switch over to the commercial product soon after approval? Thank you.

Yes, thanks for your question. We're really pleased with the progress we're making and the work we have continued to do. Our preparation started a couple of years ago with the medical affairs team. Subsequently, we've built out the commercial functions that you would expect, including marketing, market access, and patient support that Kyle referenced. We're trying to establish industry-leading support for our patients. Right now, we've begun hiring and training our field teams ready to engage with customers. So the build has gone very well and is certainly on track, aligned with our regulatory progress, which has been timely given our breakthrough designation. That puts us in a good position for a positive launch. To address your specific question about the expanded access program, we have patients who have been participating in our pivotal registration studies that will be eligible to transition onto the commercial drug as soon as approval is granted. The EAP is now in the hands of our medical team, and they're directly communicating with customers today. Patients are progressing through the administration process to gain access to Olezarsen via that program. Overall, we have made significant progress and are on track to launch as soon as the FDA provides approval. Thanks, Jay. Next question please.

The next question comes from Mike Ulz from Morgan Stanley. Please go ahead.

Hey guys. Thanks for taking the question. Maybe just one on the neurology pipeline with Angelman sort of emerging as your lead program. Can you maybe highlight what you view as the next key opportunity there? And if there's any potential read through from what you learned in Angelman's? Thanks.

Eugene?

Yes, sure. Happy to. Thanks for your question. We are delighted to have Angelman as a centerpiece of the neuroscience portfolio. It follows the Angelman Phase 3 program. A few others in the pipeline are quite exciting. Certainly, Olezarsen, which is now fully enrolled in its pivotal study, is another molecule we are particularly enthusiastic about. It addresses an ultra-rare disease and fits very well with our neurology portfolio. The study is progressing well, and we've received great feedback from sites and investigators regarding the quality of the study conduct. Following Zilganersen, we're excited about our FUS-ALS program making great strides and the first-in-human experiments that we are currently conducting. We're looking forward to sharing plenty of data with you over the coming months and years in this rich area of research and development.

Our wholly-owned neurology pipeline is positioned to grow and expand in addition to the programs that are in the clinic today. We expect to start two additional wholly-owned neurology programs by the end of this year and more next year, encompassing both rare diseases as well as larger, more prevalent indications. I also want to highlight the great progress we're making to extend our leadership technologically in neurology. Our most advanced backbone chemistry MSPA is expected to enter clinical development later this year for a CNS indication, which is aimed at significantly reducing the dosing frequency. We're making excellent strides in traversing the blood-brain barrier, whether through subcutaneous or intravenous infrequent administration approaches. We're looking forward to potentially introducing our first candidates capable of overcoming the BBB by early 2025, and we're excited to share more information about that. Our efforts in this area position us as leaders in CNS research, and I'm optimistic about our future direction. Thanks, Mike. Next question please.

The next question comes from Gary Nachman from Raymond James. Please go ahead.

Great. Thanks guys. For Donidalorsen, when you submit the NDA, what indication will you be looking for in the label? And are you optimistic that the switch data will actually be included on the label, which will be so important for these HAE patients? Any chance you could get a priority review or are you likely looking at a standard review? When will you start building out that commercial team, and how much could you fully leverage what you're doing currently with Olezarsen?

Thanks, Gary. Eugene will take the first couple of questions, and then Jonathan can discuss the build-out of the commercial team.

Yes, regarding the indication, we're seeking a broad indication for prophylaxis of attacks in hereditary angioedema, and we're pretty confident with how things are progressing. It is to be determined what the final label looks like, and the indications we will receive. We expect that the switch data will be very informative.

The switch data is significant, in our opinion, regarding safety, which we believe positions us well for it to be included in the label. These patients often switch treatment, and having data that informs physicians on how to safely switch patients to avoid any gaps in their protection against HAE attacks is critical. This data aligns with the FDA's focus on safety and progression against disease. So we have a good chance for inclusion in the label, however, as Eugene said, it’s risky to get ahead of the regulators regarding what the label would look like. Now Jonathan, how's the launch prep progressing.

Launch prep is going well. As you can imagine, this is coming on the heels of our potential lease launch that we talked about, but we have made significant advancements in the commercial side for WAINUA. There are many capabilities we've built for Olezarsen that we can leverage for Donidalorsen, including medical affairs, which is taking the lead in the HAE space, brand teams, access teams, and developing our value dossiers. Our patient services preparation is also ahead of schedule, ensuring we will support patients effectively in the HAE space, while developing omnichannel capabilities that we can leverage for both the FCS and HAE launches. Overall, we are confident about being prepared for these upcoming launches.

We're also very pleased with the preparations for submission and launch in Europe. Stay tuned for updates there as well. Next question please.

The next question comes from Salveen Richter from Goldman Sachs. Please go ahead.

Good morning, thanks for taking my question. Could you just speak to the work you're doing here on oligos with next-generation backbones and the other modalities you're looking at and when these programs might enter the clinic?

Sure. As Brett mentioned earlier, our first compound incorporating our MSPA backbone is expected to enter the clinic for a neurology indication later this year. The objectives are to extend the dosing interval with the enhanced stability of that backbone, and we will see how it performs. Additionally, we have an internal siRNA program for a follow-on indication for liver target that we anticipate starting development this year. Beyond that, we're making progress in our blood-brain barrier work with our bicycle collaboration, and we expect to have molecules that can cross the blood-brain barrier entering the clinic early next year. We're excited about the advancements we’re making across the board.

We are also pleased with our metagenome strategy aimed at gene editing, with several programs advancing preclinically. I believe next year will bring a lot of interesting developments in our gene editing program. We are making great strides to diversify and expand our technological capabilities. With that, I think we have time for one more question.

The next question comes from Kostas Biliouris from BMO Capital Markets. Please go ahead.

Hello, thanks for taking our question. And congrats on the progress. Can you talk a little bit about the CARDIO-TTRansform enrolled population and specifically the differences between the geographies, and the follow-up from the originally enrolled population and the population who were enrolled after the changes you made to the statistical design? Do you expect any impact from the differences between these two populations?

Thanks, Kostas. We have shared the demographics for our CARDIO-TTRansform study, and I look forward to sharing that data in the future. We are pleased with enrollment in the study, and we have achieved a nice balance between monotherapy and combination treatment in this significant study, the largest ever conducted in TTR cardiomyopathy. We're also pleased with the small percentages of drop-ins and drop-outs from the study, and everything is progressing as planned. The percentages of patients enrolled based on New York Health Class 1, 2, and 3 are favorable. We've observed that the expansion of our study has resulted in earlier diagnoses of patients, aligning with broader treatment opportunities. We could not be more pleased with the way the study, including the demographics, is progressing. Thank you for your question, Kostas. I believe it’s time to wrap things up. I'd like to thank everyone who joined us today for your participation and your questions. We are very proud of everything we've accomplished in the past quarter and the first half of this year, and we're planning to build on this momentum to achieve even greater successes in the second half of this year. We're looking forward to continuing to provide updates on our progress in the coming months, and into next year. Thank you very much, everyone, and have a great day.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. Goodbye.