Ionis Earnings: String of Late-Stage Pipeline Data Begins in the Second Half of 2023

We're maintaining our $62 fair value estimate for Ionis following first-quarter results that were in line with our expectations, as the firm's collaboration revenue and royalties on spinal muscular atrophy drug Spinraza from partner Biogen were relatively steady, but clinical trial and commercial readiness costs continue to keep the firm in the red. We expect the next two years to be critical, as key phase 3 trials will read out and new launches could push the firm to profitability by 2026. We think shares look undervalued, as the market doubts Ionis' ability to translate its antisense technology platform into multiple drug launches across rare diseases, neurology, and cardiology. We think Spinraza and newly approved ALS drug Qalsody provide solid proof of concept for Ionis' technology, supporting a narrow moat.