Ionis CEO Stanley Crooke at the company’s Carlsbad headquarters. With unique technology, Ionis recently locked down a $1 billion deal with Biogen.

Ionis CEO Stanley Crooke at the company’s Carlsbad headquarters. With unique technology, Ionis recently locked down a $1 billion deal with Biogen. Photo by Jamie Scott Lytle.

— When Stanley Crooke formed Ionis Pharmaceuticals in 1989, he saw the venture as a longshot. He told investors as much.

“I wasn’t telling venture investors anything they probably couldn’t figure out themselves. Making drugs is a tough business. Creating a new platform for drug discovery has rarely been done,” said Crooke, still CEO. The vision — blazing new ground in chemistry to target tough disease areas — turned into a $5.7 billion biotech. After years of trials and tribulations, Ionis is on a roll.

In 2017, the company’s blockbuster drug helped swing Ionis from an operating loss to profit. Ionis holds a 40-drug pipeline. Capping off a string of mammoth partnerships, Massachusetts-based Biogen will pay Ionis $1 billion in cash to develop neurological drugs, it was announced last month.

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Research assistant Andres Berdeja at one of Ionis’ labs in Carlsbad. Ionis pioneered antisense drugs that bind to RNA instead of proteins, which have been the focus of the pharmaceutical industry for more than 100 years.

Undervaluing the Company?

In late February, Ionis reported $508 million in revenue, a 46.4 percent year-over-year increase. For all the momentum, Crooke believes Wall Street undervalues Ionis, which he brought up twice during an hour-long interview at Ionis’ Carlsbad headquarters.

“We still have disappointments. We’re disappointed that our stock price isn’t at a much higher price,” Crooke said from his office, which offers sweeping views of sagebrush-covered fields.

Ionis was trading near $43 a share on May 1.

Wall Street seems nervous over a May 10 U.S. Federal Drug Administration panel on Ionis’ volanesorsen. Per late-stage clinical trials, volanesorsen successfully treats a debilitating rare disease, but safety concerns have weighed on volanesorsen and a few other Ionis drugs.

That’s according to Wells Fargo analyst Jim Birchenough. Nonetheless, he’s bullish on Ionis given pent-up value in the hopper.

“This is a stock where it’s being valued looking backwards at historical issues. And we think it’s worth a lot more if you look forward,” Birchenough said.

In the short term, another Ionis drug is poised for approval: inotersen, which targets abnormal protein buildup, a systemic problem that can be fatal. However, Ionis faces competition on this front.

A Big Opportunity?

Long-term promise includes early data on a potentially groundbreaking drug to reduce the underlying cause of Huntington’s disease.

This means the fatal genetic disease could be stopped or even reversed, which would mark a first. Swiss pharmaceutical giant Roche paid Ionis $45 million to license the Huntington’s drug in December. Next, Roche will run a pivotal trial of the drug candidate to further gauge clinical efficacy and safety.

“That could represent one of the most exciting opportunities in biotech,” Birchenough said.

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