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AstraZeneca
InDecember 2012, we entered into a global collaboration agreement withAstraZeneca todiscover and develop antisense
drugs against five cancer targets. As part of the agreement, we grantedAstraZeneca an exclusive license to develop and
commercialize ISIS-STAT3
Rx
and ISIS-AR
Rx
for the treatment of cancer and anoption to license up to three cancer drugs under a
separate researchprogram. We are eligible to receivemilestone payments and license fees fromAstraZeneca as programs advance in
development. In addition, we are eligible to receive double-digit royalties on anyproduct sales of drugs resulting from this
collaboration. Under the terms of the agreement, we received$31million inupfront andnear-termpayments comprised of a $25
million upfront paymentwe received inDecember 2012 and a $6million paymentwe received in June 2013, ofwhichwe recognized
$11.5million upon receipt of the payments. We are recognizing the remaining$19.5million as follows:
$11.2million related to the ISIS-AR
Rx
program, whichwe are amortizing throughMarch2014;
$7.6million related to the option to license three drugs under a separate researchprogram, whichwe are amortizing through
December 2016; and
$0.7million related to the ISIS-STAT3
Rx
program, whichwe are amortizing throughOctober 2014.
TogetherwithAstraZeneca, we are evaluating ISIS-STAT3
Rx
inpatientswith advanced cancer. AstraZeneca is conducting a
Phase 1b/2a clinical studyof ISIS-STAT3
Rx
inpatientswith advancedmetastaticHCC. We are concurrently completing a clinical
study evaluating ISIS-STAT3
Rx
in patientswith advanced lymphomas, includingpatientswithdiffuse large b-cell lymphoma. We are
responsible for completingour clinical study inpatientswith advanced lymphomas andAstraZeneca is responsible for all other
development activities for ISIS-STAT3
Rx
. In June 2013, we earned a $10millionmilestone payment whenAstraZeneca added a
seconddevelopment candidate, ISIS-AR
Rx
, toour collaboration. IfAstraZeneca successfully develops ISIS-STAT3
Rx
, ISIS-AR
Rx
, and
three drugs under the researchprogram, we could receive substantivemilestone payments ofmore than$970million, includingup to
$315.5million for the achievement of developmentmilestones andup to$655million for the achievement of regulatorymilestones.
Wewill earn the nextmilestone payment of $15million ifAstraZeneca initiates a Phase 1 study for ISIS-AR
Rx
.
InAugust 2013, we added another collaborationprogramwithAstraZeneca todiscover anddevelop an antisense drug against
anundisclosed target. AstraZeneca has the option to license a drug resulting from this research collaboration, and ifAstraZeneca
exercises its option, itwill be responsible for all further development and commercialization of the drug. We received a $750,000
upfront payment, whichwe are amortizing throughDecember 2015. We are eligible to receive license fees and substantivemilestone
payments of $163.2million, includingup to$45.2million for the achievement of research anddevelopmentmilestones andup to$105
million for regulatorymilestones. Wewill earn the next $3.25millionmilestone payment ifAstraZeneca selects a development
candidate under this collaboration. In addition, we are eligible to receive up todouble-digit royalties on sales from any product that
AstraZeneca successfully commercializes under this collaborationprogram.
During2013 and2012, we earned revenue of $29.1million and$9.3million, respectively, fromour relationshipwith
AstraZeneca, which represented 20percent and nine percent, respectively, of our total revenue for those periods.
Biogen Idec
We have established four strategic collaborationswithBiogen Idec that broaden and expandour severe and rare disease
franchise for neurological disorders.
ISIS-SMN
Rx
In January2012, we entered into a global collaboration agreementwithBiogen Idec todevelop and commercialize ISIS-
SMN
Rx
for the treatment of SMA. We received an upfront payment of $29million, whichwe are amortizing throughAugust 2016.
We are eligible to receive a license fee,milestone payments and up todouble-digit royalties on anyproduct sales of ISIS-SMN
Rx
.
Biogen Idec has the option to license ISIS-SMN
Rx
until completion of the first successful Phase 2/3 study or the completion of two
Phase 2/3 studies. IfBiogen Idec exercises its option, itwill payus a license fee andwill assume global development, regulatory and
commercialization responsibilities.
We are evaluating ISIS-SMN
Rx
in aPhase 2open-label,multiple-dose, dose-escalation study in childrenwithSMA and a
Phase 2open-label,multiple-dose, dose-escalation pilot study in infantswithSMA. In January2014, we andBiogen Idec amended
the original agreement to reflect changesmade to the clinical development plan for ISIS-SMN
Rx.
We andBiogen Idec added a new
open—label extension study, which is beingoffered to those childrenwithSMAwhohave completed dosing inour previous studies,
and expanded the dosing in the Phase 2 study in infantswithSMA. In addition, we increased the number of patients to be included in
the Phase 3 studies. As a result of these changes, we andBiogen Idec agreed to increase the payments that we are eligible to receive
