maintaining an effective cost structure that limits our cash needs. Our business strategy is supported by our
platform technology, our robust pipeline of drugs and our diverse partnering strategies, which have enabled us to
focus on doing what we do best – to discover and develop novel antisense drugs.
Our novel lipid-lowering product, KYNAMRO (mipomersen sodium) injection, is on the market in the
United States for patients with HoFH. Patients with HoFH are at high cardiovascular risk and cannot reduce their
LDL-C sufficiently with currently available lipid-lowering therapies. In January 2013, the FDA, approved the
marketing application for KYNAMRO for patients with HoFH. Genzyme, a Sanofi Company, has also obtained
marketing approval in other countries, includingMexico, Argentina, South Korea and Peru, and is pursuing
marketing approval in multiple additional markets. Genzyme is evaluating KYNAMRO in a late-stage clinical
study, FOCUS FH, in patients with severe HeFH, and they plan to report data from this study in 2015.
The efficiency and broad utility of our drug discovery technology supports the continued growth of our
pipeline of antisense drugs. To maximize the value of our drugs and technologies, we have a multifaceted
partnering strategy. Our partnering strategy provides us the flexibility to license each of our drugs at what we
believe is the optimal time to maximize the near- and long-term value of our drugs. In this way, we can expand
our and our partners’ pipelines with antisense drugs that we design to address significant medical needs while
remaining small and focused. Most recently, we established a wholly owned subsidiary, Akcea to develop and
commercialize the drugs from our lipid franchise. Akcea will focus on the development and commercialization of
ISIS-APOCIII
Rx
, ISIS-APO(a)
Rx
and ISIS-ANGPTL3
Rx
as well as more potent follow on drugs for these
programs. To leadAkcea, we hired a senior business leader with commercialization expertise in severe and rare
and cardiovascular diseases to maximize the value of our lipid franchise assets. Moving our lipid drugs into a
company that we own and control ensures that our core focus at Isis remains on innovation while allowing us to
maintain control over and retain more value from our lipid drugs.
Another component of our partnering strategy is to form traditional partnering alliances that enable us to
discover and conduct early development of new drugs, outlicense our drugs to partners, such as when we
licensed KYNAMRO to Genzyme, and build a base of license fees, milestone payments, profit share and royalty
income. We also form preferred partner transactions that provide us with a vested partner, such as AstraZeneca,
Biogen Idec, GSK, Janssen and Roche, early in the development of a drug. Typically, the drugs we partner early
in development are in therapeutic areas of high risk, like severe neurological diseases, or in areas where Phase 2
results would likely not provide a significant increase in value, like cancer. These preferred partner transactions
allow us to develop select drugs that could have significant commercial potential with a knowledgeable and
committed partner with the financial resources to fund later-stage clinical studies and expertise to complement
our own development efforts. We benefit from this strategy because it allows us to expand and broaden our drug
discovery efforts to new disease targets. For example, through our broad strategic partnership with Biogen Idec,
we are capitalizing on Biogen Idec’s extensive resources and expertise in neurological diseases to create a
franchise of novel treatments for neurological disorders. Additionally, with Janssen we have a global
collaboration to discover and develop antisense drugs to treat autoimmune disorders of the GI tract, which brings
together our RNA-targeted technology platform and Janssen’s expertise in autoimmune disorders and therapeutic
formulation to discover and develop antisense drugs to treat autoimmune disorders in the GI tract. Similar to our
other partnerships, with our preferred partner transactions we benefit financially from upfront payments,
milestone payments, licensing fees and royalties.
We also work with a consortium of companies that can exploit our drugs and technology. We call these
companies satellite companies. We benefit from the disease-specific expertise of our satellite company partners,
who are advancing drugs in our pipeline in areas that are outside of our core focus. For example, Regulus is a
satellite company partner that we co-founded to discover and develop antisense drugs targeting microRNAs. We
sold a portion of our Regulus stock in 2014 for more than $20 million of cash, and we remain a significant
shareholder in the company. We also maintain our broad RNA technology leadership through collaborations with
satellite companies. All of these different types of relationships are part of our partnering strategy, which we
designed to maximize the value of our assets, minimize the development risks of a broad pipeline of novel new
drugs, and provide us with significant reliable near-term revenue.
The broad applicability of our drug discovery technology and the clinical successes of the drugs in our
pipeline continue to create new partnering opportunities. Since January 2012, we have initiated seven new
partnerships that involve antisense drugs for the treatment of various disorders, including neurological diseases,
autoimmune disorders of the GI tract and cancer. We formed a broad alliance with Janssen to discover and
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