Ionis Pharmaceuticals, Inc. (IONS) Q3 2025 Earnings Call Transcript

Access earnings results, analyst expectations, report, slides, earnings call, and transcript.

Overview

The earnings call summary and Q&A highlight strong financial guidance, successful early product launches, and optimistic future plans with multiple product pipelines. Analysts' questions focus on growth, with management providing reassuring answers. Despite some uncertainties in pricing and physician data, the overall sentiment leans positive due to raised guidance, expected FDA approvals, and significant market opportunities. The company's strategic advancements and revenue projections suggest a positive stock price movement over the next two weeks.

Key Financial Performance

Revenue for Q3 2025 $157 million, representing a 17% increase year-over-year. This growth was driven by contributions from marketed medicines and pipeline progress.

Revenue for the first 9 months of 2025 $740 million, an increase of 55% compared with the prior year. This reflects accelerating revenue growth.

TRYNGOLZA net product sales for Q3 2025 $32 million, reflecting a nearly 70% increase in revenues quarter-over-quarter. This growth is attributed to effective patient identification initiatives and expanding prescriber base.

Royalty revenues for Q3 2025 $76 million, an increase of approximately 13% year-over-year. Contributions came from SPINRAZA and WAINUA.

Non-GAAP operating expenses for the first 9 months of 2025 Increased by 9% year-over-year. Sales and marketing expenses rose due to investments in the U.S. launch of TRYNGOLZA and DAWNZERA, while R&D expenses decreased as late-stage studies concluded.

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Operating Highlights

TRYNGOLZA: First independent launch for familial chylomicronemia syndrome (FCS), showing strong momentum with $32 million in net product sales in Q3, a 70% increase quarter-over-quarter. Recently received European approval, with plans to launch in Europe in Q4.

DAWNZERA: FDA-approved for hereditary angioedema (HAE) in August, marking the second independent launch. Early adoption is strong, with patients switching from prior therapies and treatment-naive patients starting on DAWNZERA.

Olezarsen: Positive Phase III results for severe hypertriglyceridemia (sHTG), showing significant reductions in triglycerides and acute pancreatitis events. Expected launch next year.

Zilganersen: Positive Phase III results for Alexander disease, showing disease-modifying effects. Expected launch next year.

European market expansion: TRYNGOLZA received European approval, with plans to launch in Q4.

U.S. market expansion: Commercial preparations for olezarsen and zilganersen are underway, targeting large patient populations in the U.S.

Revenue growth: Generated $157 million in Q3 revenue, a 17% increase year-over-year. Raised 2025 financial guidance to $875-$900 million.

Commercial execution: TRYNGOLZA and DAWNZERA launches are progressing well, with strong early adoption and increasing physician engagement.

Pipeline advancement: Multiple late-stage programs progressing, including olezarsen and zilganersen, with additional launches expected next year.

Focus on transformative medicines: Ionis is advancing first-in-class medicines for serious diseases, with a goal of cash flow breakeven by 2028.

Partnership strategy: Partnered pipeline expected to deliver 4 key launches by 2027, targeting rare and prevalent diseases.

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Risk or Challenges

Market Conditions: The company faces challenges in identifying and reaching the majority of the estimated 3,000 people living with FCS in the U.S., as well as expanding awareness and education among healthcare providers for their products.

Regulatory Hurdles: The company is preparing for multiple regulatory submissions, including an sNDA for olezarsen in the U.S. by the end of the year and a new drug application for zilganersen in 2026. Delays or issues in regulatory approvals could impact launch timelines and revenue projections.

Supply Chain and Operational Risks: Scaling up commercial infrastructure, including expanding the TRYNGOLZA field force to approximately 200 representatives, poses operational challenges. Additionally, ensuring treatment availability at appropriately equipped centers for new launches like zilganersen could be complex.

Economic Uncertainties: The company’s financial guidance assumes continued strong performance and investment in commercial preparations. Any economic downturns or changes in healthcare reimbursement policies could impact revenue and cash flow projections.

Strategic Execution Risks: The company is managing multiple product launches and pipeline advancements simultaneously, which could strain resources and execution capabilities. Ensuring flawless execution for launches like DAWNZERA and olezarsen is critical to maintaining momentum.

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Guidance & Outlook

2025 Financial Guidance: Ionis has raised its 2025 financial guidance, including TRYNGOLZA revenues. The company now expects to generate between $875 million and $900 million in total revenue for the year, an increase of $50 million versus prior guidance. TRYNGOLZA product sales are anticipated to be between $85 million and $95 million for the full year.

Future Product Launches: Ionis plans to launch two additional independent medicines next year: olezarsen for severe hypertriglyceridemia (sHTG) and zilganersen for Alexander disease. Olezarsen is expected to address a large patient population with unmet needs, and launch preparations are underway. Zilganersen is anticipated to be the first disease-modifying treatment for Alexander disease, with a new drug application submission planned for Q1 2026.

Partnered Pipeline Launches: By the end of 2027, Ionis anticipates four key launches from its partnered pipeline, targeting both rare and highly prevalent life-threatening diseases. These launches are expected to significantly increase total revenue for the company.

Cash Flow Breakeven: Ionis aims to achieve cash flow breakeven by 2028, supported by its advancing pipeline and strong commercial execution.

DAWNZERA Launch: DAWNZERA, approved for hereditary angioedema (HAE), has shown strong early adoption with patients switching from prior therapies and treatment-naive patients starting on it. The company expects greater revenue impact from DAWNZERA beginning next year.

Olezarsen Launch Preparations: Ionis is preparing for the launch of olezarsen in the sHTG patient population next year. The commercial team plans to target approximately 20,000 high-volume healthcare providers in the U.S. and expand outreach further. The TRYNGOLZA field force will be scaled to approximately 200 representatives ahead of the launch.

Zilganersen Launch Preparations: Preparations for zilganersen's launch include ensuring access for clinical trial participants, expediting access for diagnosed patients, and improving patient identification through enhanced genetic screening. The company is also working to ensure treatment availability at equipped centers.

ION582 for Angelman Syndrome: Enrollment in the Phase III REVEAL study for ION582 is progressing well, with full enrollment expected next year and data anticipated in 2027. The FDA has granted ION582 Breakthrough Therapy designation.

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Shareholder Return Plan

The selected topic was not discussed during the call.

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Key Q&A

Q:How should we think about the launch curve for olezarsen in sHTG, including physician targeting and patient coverage?

A:The current target population of HCPs is about 3,000, which will expand to approximately 20,000 HCPs covering around 360,000 sHTG patients. Many of these patients are on standard care treatments like fibrates, fish oils, statins, and PCSK9s. Based on Phase III data from CORE and CORE2, there is strong interest in using olezarsen for patients not achieving goals with current treatments, and strong uptake is expected.

Q:Are there any concerns regarding acute pancreatitis events in the CORE and CORE2 data?

A:There are no concerns. The data is groundbreaking, showing rapid and durable protection against acute pancreatitis. The higher triglyceride levels in CORE versus CORE2 reflect the few pancreatitis events observed. Detailed data will be presented at AHA, and simultaneous publication is being pursued.

Q:What are the peak revenue expectations for DAWNZERA, olezarsen, and Alexander disease?

A:Peak sales for DAWNZERA are expected to exceed $500 million, for olezarsen over $1 billion, and for Alexander disease over $100 million.

Q:Are there any updates on pricing for olezarsen in sHTG?

A:Pricing work is ongoing, with research on ER visits, hospitalization rates, and number needed to treat. The market size is over 3 million patients, and payers will consider their total exposure to covering olezarsen. Final pricing will be announced upon approval of the sHTG indication.

Q:Will the reduction in acute pancreatitis (AP) events in the AHA data be seen in patients with a history of AP or in preventing new events?

A:The data will show more AP events in high-risk patients with prior AP events and triglycerides above 880 mg/dL. The results align with research showing higher triglycerides lead to more AP events. The data is based on 12 months of treatment, and longer-term studies may show even more events.

Q:What is the estimated prevalence of HAE patients in the U.S., and how does it compare to other estimates?

A:The company estimates 7,000 HAE patients in the U.S., with 75% on prophylactic therapy. Some competitors estimate up to 11,000 patients, but the company is working with the 7,000 figure.

Q:Where are the additional FCS patients for TRYNGOLZA coming from, and how many physicians are prescribing it?

A:The focus is on identifying and diagnosing patients through high-prescribing sHTG physicians and marketing efforts. Clinical scoring tools are aiding diagnosis, and payer policies are streamlining prescriptions. Specific numbers of HCPs or genetic vs. clinical confirmation splits were not disclosed.

Q:Is there a chance for priority review for olezarsen in severe high triglycerides?

A:The company assumes a standard 10-month review but will pursue all avenues to expedite the process.

Q:What are the company's plans for CARDIO-TTRansform and its combination with tafamidis?

A:The study is the largest ever in TTR cardiomyopathy and includes combination usage as a key secondary endpoint. The mechanisms of silencers and stabilizers are complementary, and the study aims to show added benefit over monotherapy.

Q:What is the importance of NNT data in the AHA presentation for sHTG?

A:The NNT data will highlight the effectiveness in both all-comer and high-risk groups. The totality of data, including triglyceride reductions and acute pancreatitis prevention, will drive payer engagement and reimbursement.

Q:What are the early prescription trends for DAWNZERA?

A:DAWNZERA is being prescribed to patients switching from other prophylactic treatments, those on on-demand therapy, and newly diagnosed patients. The launch is progressing well, with positive feedback from HCPs and payers.

Q:What is driving the growth in WAINUA revenue?

A:The growth is driven by new patient identification, particularly in centers of excellence for amyloidosis. The product is performing well, with most patients paying $0 out of pocket.

Q:Will hepatic fat fraction data from the CORE studies be presented?

A:Yes, hepatic fat fraction data is a secondary endpoint and will be presented at AHA.

Q:What are the peak sales assumptions for olezarsen in sHTG?

A:The company estimates peak sales of over $1 billion, based on a market of over 3 million patients and high-risk sHTG patients numbering around 1 million. Pricing and payer dynamics are still being assessed.

Q:Will both 50 mg and 80 mg doses of olezarsen be filed for approval?

A:Yes, both doses will be filed to provide dosing flexibility for physicians.

Q:What are the reasons for patient dropouts in the CORE and CORE2 studies?

A:The dropout rate was about half of what was expected, with reasons including personal circumstances like moves, vacations, and pregnancies. There were no major safety or tolerability concerns.

Q:Review of Unclear Management Responses

A:Management avoided providing specific numbers for the split between genetic and clinical confirmation of FCS patients, as well as the exact number of physicians prescribing TRYNGOLZA. Additionally, they did not provide detailed pricing information for olezarsen, stating that research is ongoing and final pricing will be announced upon approval.

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Earnings Word Cloud

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