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Ionis sells rights to 2 drugs in $1.7B deal

Carlsbad, Calif.-based Ionis Pharmaceuticals Inc. sold the rights to two of its treatments to affiliate Akcea Therapeutics Inc. in a deal valued at up to $1.7 billion.

Ionis' inotersen and AKCEA-TTR-L are being developed to treat forms of transthyretin amyloidosis, a progressive, sometimes fatal, genetic disease.

Akcea will pay Ionis an upfront fee of $150 million, payable in common stock. Ionis will also buy another $200 million of Akcea's common shares, raising its stake by 7% to 75% to support commercializing inotersen, now under review by the U.S. Food and Drug Administration.

Regulatory approval of inotersen and AKCEA-TTR-L in the U.S. and EU will trigger milestone payments to Ionis of $50 million and $40 million, respectively.

Ionis can earn up to an additional $1.3 billion once the treatments achieve certain sales milestones. Ionis will also receive a share of the profit from the sale of the treatments.

The clinical development of AKCEA-TTR is expected to begin later this year.

Ionis' chief business officer, Sarah Boyce, will become president of Akcea and a member of the company's board.

Novartis Pharma AG, a shareholder of Akcea, agreed to vote in favor of the proposal. The transaction is expected to close in the second quarter of 2018.

Stifel Nicolaus & Co. Inc. advised Ionis on the deal, and Cowen and Co. LLC advised Akcea.