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Collaborative Arrangements and Licensing Agreements | 9 Months Ended
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Sep. 30, 2023
Collaborative Arrangements and Licensing Agreements [Abstract] |
Collaborative Arrangements and Licensing Agreements | 5. Collaborative Arrangements and Licensing Agreements Below, we have included our AstraZeneca, Biogen, GSK, Novartis, Roche and Sobi collaborations, which are the collaborations with substantive changes during 2023 from those included in Part IV, Item 15, Note 7, Collaborative Arrangements and Licensing Agreements, of our audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. AstraZeneca We have two collaborations with AstraZeneca, one focused on the joint development and commercialization of eplontersen for the treatment of transthyretin amyloidosis, or ATTR, and one focused on the treatment of cardiovascular, renal and metabolic diseases. From inception through September 30, 2023, we have received nearly $650 million from these collaborations. We are jointly developing and preparing to commercialize eplontersen with AstraZeneca in the U.S. In addition, we granted AstraZeneca exclusive rights to commercialize eplontersen outside the U.S. In the second quarter of 2023, we earned a $20 million license fee payment when we licensed rights to Latin America for eplontersen to AstraZeneca. We recognized the upfront payment in full in the second quarter of 2023 because AstraZeneca had full use of the license without any continuing involvement from us. We will achieve the next payment of $50 million upon regulatory approval in the U.S. under this collaboration. Under our collaboration for cardiovascular, renal and metabolic diseases, AstraZeneca has licensed multiple medicines from us. AstraZeneca is responsible for global development, regulatory and commercialization activities and costs for each of the medicines it has licensed from us. In the second quarter of 2023, we earned a $20 million milestone payment when AstraZeneca initiated a Phase 2b study for ION839, an investigational ligand-conjugated antisense, or LICA, medicine designed to inhibit the production of patatin-like phospholipase domain-containing 3, or PNPLA3, protein. We recognized this milestone payment as R&D revenue in full in the second quarter of 2023 because we did not have any remaining performance obligations related to the milestone payment. We will achieve the next payment of up to $30 million if AstraZeneca licenses a medicine under this collaboration. During the three and nine months ended September 30, 2023 and 2022, we earned the following revenue from our relationship with AstraZeneca (in thousands, except percentages):
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Revenue from our relationship with AstraZeneca |  | $ | 15,959 |  |  | $ | 18,107 |  |  | $ | 99,885 |  |  | $ | 55,718 |
Percentage of total revenue |  |  | 11 | % |  |  | 11 | % |  |  | 22 | % |  |  | 13 | %
We did not have any deferred contract revenue from our relationship with AstraZeneca at September 30, 2023 or December 31, 2022. Biogen We have several strategic collaborations with Biogen focused on using antisense technology to advance the treatment of neurological disorders. We developed and licensed to Biogen SPINRAZA, our approved medicine to treat people with spinal muscular atrophy, or SMA. Under our 2013 strategic neurology collaboration, Biogen developed QALSODY (tofersen), our recently approved medicine in the U.S. to treat patients with superoxide dismutase 1 amyotrophic lateral sclerosis, or SOD1-ALS. Under our collaborations, we and Biogen are currently developing numerous investigational medicines to treat neurodegenerative diseases in addition to SMA and SOD1-ALS, including medicines in development to treat people with amyotrophic lateral sclerosis, or ALS, Angelman Syndrome, or AS, Alzheimer’s disease, or AD, and Parkinson’s disease, or PD. In addition to these medicines, our collaborations with Biogen include a substantial research pipeline that addresses a broad range of neurological diseases. From inception through September 30, 2023, we have received more than $3.6 billion in payments from our Biogen collaborations. Under our 2013 strategic neurology collaboration, we earned a $16 million milestone payment from Biogen when the U.S. Food and Drug Administration, or FDA, approved Biogen’s New Drug Application, or NDA, for QALSODY in the second quarter of 2023. We recognized this milestone payment as R&D revenue in full in the second quarter of 2023 because we did not have any remaining performance obligations related to the milestone payment. Under our collaboration agreement with Biogen, we are eligible to receive tiered royalties ranging from 11 percent to 15 percent on sales of QALSODY. Following the NDA approval in April 2023, we began earning royalties from QALSODY sales, which we recognize as other commercial revenue in our condensed consolidated statements of operations. We will achieve the next milestone payment for QALSODY of $20 million if the European Medicines Agency approves Biogen’s Marketing Authorization Application, filing of QALSODY. Under our 2012 neurology collaboration, we achieved $21 million in milestone payments from Biogen when Biogen advanced ION582, our investigational antisense medicine for the potential treatment of AS, in the third quarter of 2023. We are recognizing these milestone payments as revenue as we perform services based on our effort to satisfy our R&D services performance obligation relative to the total effort expected to satisfy our performance obligation for ION582. During the three and nine months ended September 30, 2023 and 2022, we earned the following revenue from our relationship with Biogen (in thousands, except percentages):
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Revenue from our relationship with Biogen |  | $ | 94,695 |  |  | $ | 88,959 |  |  | $ | 262,599 |  |  | $ | 259,713 |
Percentage of total revenue |  |  | 66 | % |  |  | 56 | % |  |  | 57 | % |  |  | 60 | %
In October 2023, we earned a milestone payment of $9 million from Biogen when we advanced ION582 under our 2012 neurology collaboration. We will achieve the next payment of $70 million if Biogen licenses ION582 under this collaboration. Our condensed consolidated balance sheets at September 30, 2023 and December 31, 2022 included deferred contract revenue of $316.8 million and $351.2 million, respectively, from our relationship with Biogen. GSK In March 2010, we entered into a collaboration with GSK using our antisense drug discovery platform to discover and develop new medicines against targets for serious and rare diseases, including infectious diseases and some conditions causing blindness. Our collaboration with GSK currently includes bepirovirsen, our medicine in development for the treatment of hepatitis B virus, or HBV, infection. In the third quarter of 2019, following positive Phase 2 results, GSK licensed our HBV program. GSK is responsible for all global development, regulatory and commercialization activities and costs for the HBV program. From inception through September 30, 2023, we have received more than $105 million in an upfront payment and payments related to the HBV program. In the first quarter of 2023, we earned a $15 million milestone payment when GSK initiated a Phase 3 program of bepirovirsen. We recognized this milestone payment as R&D revenue in full in the first quarter of 2023 because we did not have any remaining performance obligations related to the milestone payment. We will achieve the next payment of $15 million if the FDA accepts an NDA filing of bepirovirsen for review. During the three and nine months ended September 30, 2023 and 2022, we earned the following revenue from our relationship with GSK (in thousands, except percentages):
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Revenue from our relationship with GSK |  | $ | — |  |  | $ | — |  |  | $ | 15,000 |  |  | $ | — |
Percentage of total revenue |  |  | 0 | % |  |  | 0 | % |  |  | 3 | % |  |  | 0 | %
We did not have any deferred contract revenue from our relationship with GSK at September 30, 2023 or December 31, 2022. Novartis In January 2017, we initiated a collaboration with Novartis to develop and commercialize pelacarsen, an investigational medicine for patients with elevated lipoprotein(a), or Lp(a)-driven cardiovascular disease, or CVD. Novartis is responsible for conducting and funding development and regulatory activities for pelacarsen, including a global Phase 3 cardiovascular outcomes study, which Novartis initiated in December 2019. In August 2023, we entered into a collaboration and license agreement with Novartis for the discovery, development and commercialization of a novel medicine for patients with Lp(a)-driven CVD. Novartis is solely responsible for the development, manufacturing and potential commercialization of the next generation Lp(a) therapy. In September 2023, this agreement received clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. Novartis paid us a $60 million upfront payment in October 2023 and we are eligible to receive development, regulatory and commercial milestone payments and tiered royalties ranging from 10 percent to 20 percent on net sales of any product resulting from this collaboration. At the commencement of this collaboration, we identified one performance obligation, which was to perform R&D services for Novartis. We included the upfront payment in our transaction price for our R&D services performance obligation. We are recognizing revenue for our R&D services performance obligation as we perform services based on our effort to satisfy our performance obligation relative to our total effort expected to satisfy our performance obligation. We will achieve the next payment of $5 million if we designate a development candidate under this collaboration. From inception through September 30, 2023, we have received more than $275 million in payments from our Novartis collaborations. During the three and nine months ended September 30, 2023 and 2022, we earned the following revenue from our relationship with Novartis (in thousands, except percentages):
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Revenue from our relationship with Novartis |  | $ | 1,908 |  |  | $ | — |  |  | $ | 2,023 |  |  | $ | — |
Percentage of total revenue |  |  | 1 | % |  |  | 0 | % |  |  | 0 | % |  |  | 0 | %
Our condensed consolidated balance sheet at September 30, 2023 included deferred contract revenue of $58.1 million from our relationship with Novartis. We did not have any deferred contract revenue from our relationship with Novartis at December 31, 2022. Roche We have three collaborations with Hoffmann-La Roche Inc and F. Hoffmann-La Roche Ltd, collectively Roche: one to develop treatments for Huntington’s disease, or HD, one to develop IONIS-FB-LRx for the treatment of complement-mediated diseases, and one to develop RNA-targeted programs for AD and HD. In September 2023, we entered into an agreement with Roche to develop two undisclosed early-stage programs for RNA-targeting investigational medicines for the treatment of AD and HD. Under the agreement, we are responsible for advancing the two programs through preclinical studies and Roche is responsible for clinical development, manufacturing and commercialization of the medicines if they receive regulatory approval. Roche paid us a $60 million upfront payment in October 2023 and we are eligible to receive development, regulatory and commercial milestone payments and tiered royalties up to the mid-teens on net sales of any product resulting from this collaboration. We identified two performance obligations under this new agreement, comprised of R&D services for each of the two separate programs. We included the upfront payment in our transaction price for our R&D services performance obligations. We are recognizing revenue for our R&D services performance obligations as we perform services based on our effort to satisfy our performance obligations relative to our total effort expected to satisfy our performance obligations. We will achieve the next payment of $7.5 million if we advance a medicine under this collaboration. From inception through September 30, 2023, we have received more than $285 million in payments from our Roche collaborations. During the three and nine months ended September 30, 2023 and 2022, we earned the following revenue from our relationship with Roche (in thousands, except percentage amounts):
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
R&D revenue |  | $ | 8,858 |  |  | $ | 41,504 |  |  | $ | 16,979 |  |  | $ | 65,360 |
Percentage of total revenue |  |  | 6 | % |  |  | 26 | % |  |  | 4 | % |  |  | 15 | %
Our condensed consolidated balance sheets at September 30, 2023 and December 31, 2022 included deferred contract revenue of $68.0 million and $22.4 million, respectively, from our relationship with Roche. Swedish Orphan Biovitrum AB (Sobi) We began commercializing TEGSEDI and WAYLIVRA in Europe in January 2021 and TEGSEDI in North America in April 2021 through distribution agreements with Swedish Orphan Biovitrum AB, or Sobi. Under our agreements, we are responsible for supplying finished goods inventory to Sobi and Sobi is responsible for selling each medicine to the end customer. In exchange, we earn a distribution fee on net sales from Sobi for each medicine. In October 2023, our distribution agreement for TEGSEDI in North America was terminated. During the three and nine months ended September 30, 2023 and 2022, we earned the following revenue from our distribution agreement with Sobi for TEGSEDI in North America (in thousands, except percentage amounts).
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
TEGSEDI revenue from our distribution agreement with Sobi in North America |  | $ | 794 |  |  | $ | 1,008 |  |  | $ | 2,189 |  |  | $ | 3,443 |
Percentage of total revenue |  |  | 1 | % |  |  | 1 | % |  |  | 2 | % |  |  | 1 | %

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- Definition The entire disclosure for collaborative arrangements in which the entity is a participant, including a) information about the nature and purpose of such arrangements; b) its rights and obligations thereunder; c) the accounting policy for collaborative arrangements; and d) the income statement classification and amounts attributable to transactions arising from the collaborative arrangement between participants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -SubTopic 10 -Topic 808 -Publisher FASB -URI https://asc.fasb.org//1943274/2147479402/808-10-50-1 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (b) -SubTopic 10 -Topic 808 -Publisher FASB -URI https://asc.fasb.org//1943274/2147479402/808-10-50-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 808 -Publisher FASB -URI https://asc.fasb.org//808/tableOfContent + Details
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