Captive Development &Commercialization Company; Akcea Therapeutics
And finally, we have evolved our business strategy to retain greater control over the development of our
drugs and retain a larger portion of the commercial revenue. For these drugs, we believe that we have a clear and
relatively quick path to the market, such as with drugs for rare disease opportunities. These drugs have clearly
defined patient populations with minimal or no available treatments. Many of the drugs in our pipeline that meet
these criteria are part of our lipid franchise. In late 2014, we established a wholly owned subsidiary, Akcea
Therapeutics, Inc., to develop and commercialize the drugs from our lipid franchise. Akcea is focused on
developing ISIS-APOCIII
Rx
, ISIS-APO(a)
Rx
and ISIS-ANGPTL3
Rx
, plus more potent follow on drugs for these
programs. We hired a senior business leader with commercialization expertise in severe and rare and
cardiovascular diseases to leadAkcea and to maximize the value of our lipid franchise assets. Moving our lipid
assets into a company that we own and control keeps our core focus at Isis on innovation and allows us to
maintain control over and retain more value from our lipid drugs.
Satellite Companies
We also work with a consortium of companies that can exploit our drugs and technologies outside our
primary areas of focus. We call these companies satellite companies. We benefit from the disease-specific
expertise of our satellite company drug development partners, who are advancing drugs in our pipeline in areas
that are outside of our core focus. Through this strategy we can expand the therapeutic range of antisense drugs
into diseases that need new and innovative treatment options. We also benefit from our ownership in these
satellite companies.For example, Regulus is a satellite company partner that we co-founded to discover and
develop antisense drugs targeting microRNAs. In 2014, we sold a portion of our shares in Regulus for more than
$20 million of cash, and we remain a significant shareholder in the company.
In addition to our satellite company drug development partners, we form satellite company partnerships
focused on developing and advancing certain RNA-targeting therapeutic technologies. These partnerships take
advantage of our dominant RNA-targeting intellectual property estate, and leverage our investments in our core
technologies. These collaborations typically involve a cross-license between us and our partner and allow us to
participate in newly emerging approaches to RNA-targeting therapeutics and augment our active programs in
these areas. We provide more information on our satellite company partners in this section under the subheading
‘‘Satellite Company Collaborations’’.
We highlight our traditional pharmaceutical and satellite company partnerships below. In addition, we have
numerous other partnerships, which we also describe below.
Preferred Partner Transactions &Traditional Alliances
We have a long history of establishing alliances with pharmaceutical industry leaders. We form traditional
partnering alliances that enable us to discover and conduct early development of new drugs, outlicense our drugs
to partners, and build a broad base of license fees, milestone payments, profit share and royalty income. In
contrast, our preferred partner transactions provide us with a vested partner early in the development of a drug.
With our preferred partners, we are able to expand and broaden our drug discovery efforts to new disease targets
in therapeutic areas that are outside of our expertise or in areas where our partners will provide tools and
resources that will complement our drug discovery efforts. For instance, we established a broad strategic alliance
with Biogen Idec that pairs Biogen Idec’s extensive resources and expertise in neurological diseases with our
antisense technology. Together we are creating a franchise of novel treatments for neurological disorders that will
expand both our pipeline and Biogen Idec’s pipeline with promising new treatments. In cancer, we are working
with our partner, AstraZeneca, to conduct comprehensive clinical programs for ISIS-STAT3-2.5
Rx
and
ISIS-AR-2.5
Rx
, anti-cancer drugs we licensed toAstraZeneca. Through our collaboration, we are also applying
AstraZeneca’s proprietary preclinical cancer models and screening systems to evaluate new oncology targets. In
December 2014, we entered into a preferred partner transaction with Janssen. Together with Janssen, we plan to
expand the reach of our antisense technology to discover and develop antisense drugs to treat autoimmune
disorders of the GI tract.
In all of our partnerships, we benefit from the expertise our partners bring to our drugs. By coupling our
partnering activity with our efficient drug discovery technology, we can develop the majority of our drugs in our
core therapeutic areas ourselves through proof-of-value prior to licensing. As a result of our unique strategy and
innovative research and development capabilities, we can keep our organization small and focused.
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