It’s about the partnerships
Nowadays it has become commonplace for smaller biotechnology companies to seek a marketing/licensing partner for its most promising drugs. Rarely, though, do we see the number of partnerships as exhibited by Isis.
If you though having 31 potential revenue-producing compounds was astounding, wait until I tell you that Isis has 12 different clinical partners, ranging from big pharmaceutical juggernauts like AstraZeneca plc (ADR) (NYSE:AZN) and Sanofi SA (ADR) (NYSE:SNY) to smaller players like OncoGenex Pharmaceuticals and privately held partners like Atlantic Pharmaceuticals. AstraZeneca and OncoGenex are playing a critical role in partnering with Isis to develop its portfolio of promising cancer products. For instance, ISIS-STAT3rx with AstraZeneca plc (ADR) (NYSE:AZN) exhibited clear responses in advanced cancer patients in early stage trials. On the other hand, Sanofi SA (ADR) (NYSE:SNY)’s Genzyme unit is the licensing partner for Kynamro, the company’s FDA approved injection to treat homozygous familiar hypercholesterolemia, or HoFH. Kynamro is also being tested as a lipid-lowering therapy to help treat cardiovascular disease with late-stage trials currently focusing on lowering apoC-III levels.
In addition, Isis and Alnylam Pharmaceuticals combined their intellectual properties and know-how into a spinoff in 2010 known as Regulus Therapeutics, which supplies both parent companies with supplemental royalties any time it strikes a partnership or licensing deal.
It’s about proven results
I would often hesitate to cause one drug approval proof of a pipeline’s success, but that’s what Kynamro may shape up to be for Isis. Priced at $176,000 annually, Kynamro is one of two newly FDA-approved treatments for HoFH – the other being Juxtapid by Aegerion Pharmaceuticals, Inc. (NASDAQ:AEGR). On an ease-of-use basis, the orally ingested Juxtapid is certain to be preferred over injectable Kynamro, and the safety profile in trials slightly favors Juxtapid as well. However, physicians who are afraid of being reimbursed, and insurance companies looking to save a lot of money, may consider turning to Kynamro which is nearly $120,000 cheaper on an annual basis than Juxtapid.
Keep in mind that just because I’m extremely optimistic about Isis’ future doesn’t mean it’s not without its risks. Having a vast product portfolio doesn’t mean anything if more of its drugs fail in mid and late-stage trials, or if physicians fail to prescribe its FDA-approved drugs. Thus far, Juxtapid has been the HoFH drug of the two that appears to be vaulting out of the gate.
Ultimately, I believe Isis has a lot of potential — possibly the potential to double or even triple from its current market value — but it’s definitely a company that should be left to biotech-savvy investors who are willing to accept greater risks for a chance at a big reward.
The article Despite a Mid-Stage Disappointment, This Biotech Stock Is Still in Great Shape originally appeared on Fool.com and is written by Sean Williams.
Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.The Motley Fool recommends Alnylam Pharmaceuticals.
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