Isis Pharmaceuticals Reports First Quarter 2001 Highlights And Financial Results

Company Reviews Next 12 Month Milestones



Apr 25, 2001, 01:00 ET from Isis Pharmaceuticals, Inc.

    CARLSBAD, Calif., April 25 /PRNewswire/ -- Isis Pharmaceuticals, Inc.
 (Nasdaq:   ISIP), today announced that its loss from operations for the first
 quarter was $17.2 million on revenues of $4.6 million, compared with
 $12.6 million on revenues of $4.1 million for the same period last year.  The
 company's net loss applicable to common stock for the quarter was $23.2
 million, or $0.58 per share, compared with a net loss applicable to common
 stock of $18.6 million, or $0.56 per share, for the same period last year.
 This increase in net loss and operating loss is primarily the result of
 increased operating expenses related to the eleven products that Isis has in
 development, including costs for the ongoing Phase 3 trial of ISIS 3521, the
 company's drug for non-small cell lung cancer.
     Operating expenses totaled $21.9 million for the first quarter, up from
 $16.7 million for the same period in 2000. These expenses were driven
 primarily by increased research and development (R&D) expenses required to
 advance the development of the company's products.  Isis currently has eleven
 products in development, up from seven in the same period last year. Six
 products are currently in more expensive stages of development, Phase 2 or
 Phase 3 trials.  Included in R&D expenses this quarter were unusually high
 costs associated with the build up of raw material inventory for drug
 manufacturing. General and administrative costs have been increasing at a
 slower rate than R&D. Revenue for the first quarter 2001 of $4.6 million
 increased 14% over the $4.1 million reported for the same period last year.
     Isis maintained a strong balance sheet by ending the quarter with
 $108.4 million in cash and short term investments and working capital of
 $101.7 million.  At December 31, 2000, Isis had cash and short term
 investments of $127.3 million and working capital of $118.6 million.
     "As we expected, our R&D expenses have increased compared to last year as
 a reflection of expanded activities to advance the development of the eleven
 products in our pipeline," said B. Lynne Parshall, Isis' Executive Vice
 President and CFO.  "With our investment, we hope to bring each product to a
 point where it can generate the maximum value for Isis, which will fund
 further development of our earlier-stage products. We are investing in the
 Phase 3 trial of ISIS 3521 in patients with non-small cell lung cancer. This
 study is well underway, with all 60 sites actively recruiting patients.
     "Other highlights in the first quarter included the extension of two
 partnerships: our GeneTrove collaboration with Abbott for target validation
 and our research collaboration with Merck that is focused on hepatitis C.  We
 are pleased with this affirmation of the value we provide our partners. We are
 pursuing additional GeneTrove collaborations, new antisense drug discovery
 partnerships and licensing of drugs in development, with the goal of adding
 significantly to our revenues," said Ms. Parshall.
     "We recently achieved a key milestone in the development of antisense
 technology with our report of favorable results from the first human study of
 a second-generation antisense drug, ISIS 104838," Ms. Parshall continued. "The
 data indicated that we will likely be able to dose second-generation drugs as
 infrequently as once every 2 to 4 weeks, making these antisense drugs
 extremely convenient for patients and reducing cost of therapy.  Additionally,
 we observed that subcutaneous dosing was well tolerated even at doses as high
 as 6 mg, which will enhance patient acceptance. These results broaden the
 application of antisense drugs to include chronic diseases where dosing
 convenience is required. The year ahead promises to be important for Isis, as
 we report results from four Phase 2 clinical programs, initiate our Phase 3
 program with ISIS 2302 in Crohn's disease and advance other drugs in
 development."
     Isis described its clinical goals for 2001 in a corporate presentation
 during Isis' Annual Meeting and Open House earlier this month.  The goals are
 as follows:
 
                        Isis' Clinical Development Goals
     First Half 2001
     --  Report ISIS 104838 Phase 1 IV (intravenous) and subcutaneous
         results -- completed
     --  Initiate oral solid dosing trials of ISIS 104838 -- completed
     --  Initiate topical Phase 1 / 2 trials of ISIS 104838
     --  Report ISIS 2302 Phase 2 topical psoriasis drug concentration results
     --  Report ISIS 2302 Phase 2 topical psoriasis efficacy results
     --  Update ISIS 3521 Phase 2 non-small cell lung cancer data at ASCO
     --  Report ISIS 14803 Phase 2 hepatitis C trial results
 
     Second Half 2001/First Quarter 2002
     --  Initiate ISIS 2302 Phase 3 trial in Crohn's disease
     --  Initiate ISIS 104838 Phase 2 trial in rheumatoid arthritis
     --  Report ISIS 2503 Phase 2 results in various cancers
     --  Report ISIS 5132 Phase 2 results in various cancers
     --  Report ISIS 3521 Phase 2 results in non-Hodgekin's lymphoma
     --  Report ISIS 2302 Phase 2 ulcerative colitis data
     --  Initiate ISIS 113715 Phase 1 trial in Type II diabetes
     --  Initiate ISIS 13650 Phase 1 trial in diabetic retinopathy /
         age-related macular degeneration
     --  Significantly enroll ISIS 3521 Phase 3 trial in non-small cell lung
         cancer
 
     The Annual Meeting and Open House presentation was broadcast live over the
 Internet and can be viewed at www.streetfusion.com by typing ISIP in the
 ticker box.
     Isis will conduct a live webcast conference call to discuss this earnings
 release on Wednesday, April 25 at 11:00 am Eastern time.  To participate over
 the Internet go to www.streetfusion.com.  A replay of the webcast will be
 available at this address for up to 90 days.
 
     Isis Pharmaceuticals, Inc. is exploiting its expertise in RNA to discover
 and develop novel human therapeutic drugs.  The company has commercialized its
 first product, Vitravene(TM) (fomivirsen), to treat CMV-induced retinitis in
 AIDS patients. In addition, Isis has eleven products in its development
 pipeline, with two in late-stage development and four in Phase 2 human
 clinical trials.  ISIS 3521, an inhibitor of PKC-alpha, is in Phase 3 trials
 for non-small cell lung cancer.  Isis is preparing to initiate a Phase 3
 program for ISIS 2302 (alicaforsen), an ICAM-1 inhibitor, in Crohn's disease.
 Isis has a broad and proprietary patent estate of more than 700 issued and
 allowed patents worldwide. Isis' GeneTrove(TM) division uses antisense to
 assist pharmaceutical industry partners in validating and prioritizing
 potential gene targets through customized services and access to an extensive
 gene function database.  Ibis Therapeutics(TM) is a division focused on the
 discovery of small molecule drugs that bind to RNA.
 
     This press release contains forward-looking statements concerning the
 financial position of Isis Pharmaceuticals, Inc., the planned development
 activities and therapeutic potential for our products in our pipeline, and the
 potential value of the company's functional genomics and drug discovery
 technology platform.  Such statements are subject to certain risks and
 uncertainties, particularly those inherent in the process of discovering,
 developing and commercializing drugs that are safe and effective for use as
 human therapeutics and financing such activities.  Actual results could differ
 materially from those projected in this release.  As a result, the reader is
 cautioned not to rely on these forward-looking statements.  These and other
 risks concerning Isis' research and development programs are described in
 additional detail in Isis' Annual Report on Form 10-K, and any subsequent
 amendments, for the year ended December 31, 2000, which is on file with the
 U.S. Securities and Exchange Commission, copies of which are available from
 the company.
 
     Vitravene(TM) is a trademark of Novartis AG.
     GeneTrove(TM) and Ibis Therapeutics(TM) are trademarks of Isis
 Pharmaceuticals, Inc.
 
 
                           ISIS PHARMACEUTICALS, INC.
                         SELECTED FINANCIAL INFORMATION
                     (In Thousands, Except Per Share Data)
 
                       Condensed Statements of Operations
 
                                                       Three months ended,
                                                            March 31,
                                                       2001            2000
                                                            (Unaudited)
     Revenue:
       Research and development revenues under
        collaborative agreements                       $2,789         $2,748
       Research and development revenues
        from affiliates                                 1,716          1,168
 
       Licensing and royalty revenues                     128            138
     Total revenue                                      4,633          4,054
 
     Expenses:
       Research and development                        19,134         13,239
       General and administrative                       2,816          1,824
       Compensation related to stock options              (83)            --
       Restructuring activities                            --          1,608
     Total operating expenses                          21,867         16,671
 
     Loss from operations                             (17,234)       (12,617)
 
     Equity in loss of affiliates                      (3,964)        (3,495)
     Interest income                                    1,977            892
     Interest expense                                  (3,626)        (3,107)
 
     Net loss                                         (22,847)       (18,327)
 
     Accretion of dividends on preferred stock           (319)          (281)
 
     Net loss applicable to common stock             $(23,166)      $(18,608)
 
     Basic and diluted net loss per share             $(0.58)        $(0.56)
 
     Shares used in computing basic and diluted
      net loss per share                               40,150         33,063
 
 
                            Condensed Balance Sheets
 
                                                     March 31,    December 31,
                                                       2001           2000
 
     Assets:
       Current assets                                $116,187       $133,204
       Property, plant and equipment, net              22,596         22,625
       Other assets                                    16,594         14,936
       Investments in affiliates                        7,987         12,491
                                                     $163,364       $183,256
 
     Liabilities and stockholders' equity:
       Current liabilities                            $14,441        $14,636
       Long-term obligations, net of current portion  104,455        102,254
       Stockholders' equity                            44,468         66,366
                                                     $163,364       $183,256
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X73238452
 
 

SOURCE Isis Pharmaceuticals, Inc.
    CARLSBAD, Calif., April 25 /PRNewswire/ -- Isis Pharmaceuticals, Inc.
 (Nasdaq:   ISIP), today announced that its loss from operations for the first
 quarter was $17.2 million on revenues of $4.6 million, compared with
 $12.6 million on revenues of $4.1 million for the same period last year.  The
 company's net loss applicable to common stock for the quarter was $23.2
 million, or $0.58 per share, compared with a net loss applicable to common
 stock of $18.6 million, or $0.56 per share, for the same period last year.
 This increase in net loss and operating loss is primarily the result of
 increased operating expenses related to the eleven products that Isis has in
 development, including costs for the ongoing Phase 3 trial of ISIS 3521, the
 company's drug for non-small cell lung cancer.
     Operating expenses totaled $21.9 million for the first quarter, up from
 $16.7 million for the same period in 2000. These expenses were driven
 primarily by increased research and development (R&D) expenses required to
 advance the development of the company's products.  Isis currently has eleven
 products in development, up from seven in the same period last year. Six
 products are currently in more expensive stages of development, Phase 2 or
 Phase 3 trials.  Included in R&D expenses this quarter were unusually high
 costs associated with the build up of raw material inventory for drug
 manufacturing. General and administrative costs have been increasing at a
 slower rate than R&D. Revenue for the first quarter 2001 of $4.6 million
 increased 14% over the $4.1 million reported for the same period last year.
     Isis maintained a strong balance sheet by ending the quarter with
 $108.4 million in cash and short term investments and working capital of
 $101.7 million.  At December 31, 2000, Isis had cash and short term
 investments of $127.3 million and working capital of $118.6 million.
     "As we expected, our R&D expenses have increased compared to last year as
 a reflection of expanded activities to advance the development of the eleven
 products in our pipeline," said B. Lynne Parshall, Isis' Executive Vice
 President and CFO.  "With our investment, we hope to bring each product to a
 point where it can generate the maximum value for Isis, which will fund
 further development of our earlier-stage products. We are investing in the
 Phase 3 trial of ISIS 3521 in patients with non-small cell lung cancer. This
 study is well underway, with all 60 sites actively recruiting patients.
     "Other highlights in the first quarter included the extension of two
 partnerships: our GeneTrove collaboration with Abbott for target validation
 and our research collaboration with Merck that is focused on hepatitis C.  We
 are pleased with this affirmation of the value we provide our partners. We are
 pursuing additional GeneTrove collaborations, new antisense drug discovery
 partnerships and licensing of drugs in development, with the goal of adding
 significantly to our revenues," said Ms. Parshall.
     "We recently achieved a key milestone in the development of antisense
 technology with our report of favorable results from the first human study of
 a second-generation antisense drug, ISIS 104838," Ms. Parshall continued. "The
 data indicated that we will likely be able to dose second-generation drugs as
 infrequently as once every 2 to 4 weeks, making these antisense drugs
 extremely convenient for patients and reducing cost of therapy.  Additionally,
 we observed that subcutaneous dosing was well tolerated even at doses as high
 as 6 mg, which will enhance patient acceptance. These results broaden the
 application of antisense drugs to include chronic diseases where dosing
 convenience is required. The year ahead promises to be important for Isis, as
 we report results from four Phase 2 clinical programs, initiate our Phase 3
 program with ISIS 2302 in Crohn's disease and advance other drugs in
 development."
     Isis described its clinical goals for 2001 in a corporate presentation
 during Isis' Annual Meeting and Open House earlier this month.  The goals are
 as follows:
 
                        Isis' Clinical Development Goals
     First Half 2001
     --  Report ISIS 104838 Phase 1 IV (intravenous) and subcutaneous
         results -- completed
     --  Initiate oral solid dosing trials of ISIS 104838 -- completed
     --  Initiate topical Phase 1 / 2 trials of ISIS 104838
     --  Report ISIS 2302 Phase 2 topical psoriasis drug concentration results
     --  Report ISIS 2302 Phase 2 topical psoriasis efficacy results
     --  Update ISIS 3521 Phase 2 non-small cell lung cancer data at ASCO
     --  Report ISIS 14803 Phase 2 hepatitis C trial results
 
     Second Half 2001/First Quarter 2002
     --  Initiate ISIS 2302 Phase 3 trial in Crohn's disease
     --  Initiate ISIS 104838 Phase 2 trial in rheumatoid arthritis
     --  Report ISIS 2503 Phase 2 results in various cancers
     --  Report ISIS 5132 Phase 2 results in various cancers
     --  Report ISIS 3521 Phase 2 results in non-Hodgekin's lymphoma
     --  Report ISIS 2302 Phase 2 ulcerative colitis data
     --  Initiate ISIS 113715 Phase 1 trial in Type II diabetes
     --  Initiate ISIS 13650 Phase 1 trial in diabetic retinopathy /
         age-related macular degeneration
     --  Significantly enroll ISIS 3521 Phase 3 trial in non-small cell lung
         cancer
 
     The Annual Meeting and Open House presentation was broadcast live over the
 Internet and can be viewed at www.streetfusion.com by typing ISIP in the
 ticker box.
     Isis will conduct a live webcast conference call to discuss this earnings
 release on Wednesday, April 25 at 11:00 am Eastern time.  To participate over
 the Internet go to www.streetfusion.com.  A replay of the webcast will be
 available at this address for up to 90 days.
 
     Isis Pharmaceuticals, Inc. is exploiting its expertise in RNA to discover
 and develop novel human therapeutic drugs.  The company has commercialized its
 first product, Vitravene(TM) (fomivirsen), to treat CMV-induced retinitis in
 AIDS patients. In addition, Isis has eleven products in its development
 pipeline, with two in late-stage development and four in Phase 2 human
 clinical trials.  ISIS 3521, an inhibitor of PKC-alpha, is in Phase 3 trials
 for non-small cell lung cancer.  Isis is preparing to initiate a Phase 3
 program for ISIS 2302 (alicaforsen), an ICAM-1 inhibitor, in Crohn's disease.
 Isis has a broad and proprietary patent estate of more than 700 issued and
 allowed patents worldwide. Isis' GeneTrove(TM) division uses antisense to
 assist pharmaceutical industry partners in validating and prioritizing
 potential gene targets through customized services and access to an extensive
 gene function database.  Ibis Therapeutics(TM) is a division focused on the
 discovery of small molecule drugs that bind to RNA.
 
     This press release contains forward-looking statements concerning the
 financial position of Isis Pharmaceuticals, Inc., the planned development
 activities and therapeutic potential for our products in our pipeline, and the
 potential value of the company's functional genomics and drug discovery
 technology platform.  Such statements are subject to certain risks and
 uncertainties, particularly those inherent in the process of discovering,
 developing and commercializing drugs that are safe and effective for use as
 human therapeutics and financing such activities.  Actual results could differ
 materially from those projected in this release.  As a result, the reader is
 cautioned not to rely on these forward-looking statements.  These and other
 risks concerning Isis' research and development programs are described in
 additional detail in Isis' Annual Report on Form 10-K, and any subsequent
 amendments, for the year ended December 31, 2000, which is on file with the
 U.S. Securities and Exchange Commission, copies of which are available from
 the company.
 
     Vitravene(TM) is a trademark of Novartis AG.
     GeneTrove(TM) and Ibis Therapeutics(TM) are trademarks of Isis
 Pharmaceuticals, Inc.
 
 
                           ISIS PHARMACEUTICALS, INC.
                         SELECTED FINANCIAL INFORMATION
                     (In Thousands, Except Per Share Data)
 
                       Condensed Statements of Operations
 
                                                       Three months ended,
                                                            March 31,
                                                       2001            2000
                                                            (Unaudited)
     Revenue:
       Research and development revenues under
        collaborative agreements                       $2,789         $2,748
       Research and development revenues
        from affiliates                                 1,716          1,168
 
       Licensing and royalty revenues                     128            138
     Total revenue                                      4,633          4,054
 
     Expenses:
       Research and development                        19,134         13,239
       General and administrative                       2,816          1,824
       Compensation related to stock options              (83)            --
       Restructuring activities                            --          1,608
     Total operating expenses                          21,867         16,671
 
     Loss from operations                             (17,234)       (12,617)
 
     Equity in loss of affiliates                      (3,964)        (3,495)
     Interest income                                    1,977            892
     Interest expense                                  (3,626)        (3,107)
 
     Net loss                                         (22,847)       (18,327)
 
     Accretion of dividends on preferred stock           (319)          (281)
 
     Net loss applicable to common stock             $(23,166)      $(18,608)
 
     Basic and diluted net loss per share             $(0.58)        $(0.56)
 
     Shares used in computing basic and diluted
      net loss per share                               40,150         33,063
 
 
                            Condensed Balance Sheets
 
                                                     March 31,    December 31,
                                                       2001           2000
 
     Assets:
       Current assets                                $116,187       $133,204
       Property, plant and equipment, net              22,596         22,625
       Other assets                                    16,594         14,936
       Investments in affiliates                        7,987         12,491
                                                     $163,364       $183,256
 
     Liabilities and stockholders' equity:
       Current liabilities                            $14,441        $14,636
       Long-term obligations, net of current portion  104,455        102,254
       Stockholders' equity                            44,468         66,366
                                                     $163,364       $183,256
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X73238452
 
 SOURCE  Isis Pharmaceuticals, Inc.