Venture Capital

Novartis-backed Ionis subsidiary Akcea maps a $100M IPO as it steers a lead drug to regulators

Paula Soteropoulos

Over the last three months Ionis subsidiary Akcea has executed a $1.65 billion partnership with Novartis on two of its four drugs and mapped a path to regulators on both sides of the Atlantic after its lead therapy volanesorsen successfully completed a Phase III study. And now Akcea — a specialist in lipid disorders — is shooting for a $100 million IPO, with Novartis coming in to support the move with an extra $50 million to purchase a growing equity stake.

Much of the value in the IPO will be assigned to volanesorsen, which investigators says was successful in treating rare cases of familial chylomicronemia syndrome. Founded in 2015, Akcea plans to go on to market volanesorsen alone in the US and Europe, with its partners at Novartis stepping in on the next two therapies — AKCEA-APO(a)-LRx. and AKCEA-APOCIII-LRx — it plans to steer to regulators. Novartis first, though, has to decide if it wants to pick up options for the drugs and pay for Phase III itself.

Akcea is run by CEO Paula Soteropoulos, a longtime Genzyme vet who went on to Moderna before taking the lead role at the subsidiary. Her total compensation was a hefty $7.8 million in 2015, when the subsidiary was started in Cambridge, MA, and $3.4 million last year. Ionis currently owns all 73.8 million shares in Akcea, according to the S-1.

Ionis, which has seen its stock rise and fall in a roller coaster ride driven by successes and threats over the past year, will remain the principal shareholder of the public company, which will rely heavily on volanesorsen to make its case to investors.

In the Phase III investigators reported a huge drop in triglycerides among the 33 FCS patients taking the drug, hitting the primary endpoint. The placebo arm saw the level of triglycerides go up, helping to illustrate the treatment effect. The drug is designed to tackle a disease caused by hereditary mutations that inhibit the activity of lipoprotein lipase, needed to break down triglycerides carried by chylomicrons.

But researchers also noted that five patients were forced out of the trial due to a threatening decline in platelet counts. Grade 4 thrombocytopenia occurred in three patients, which ended after they stopped dosing. There were no withdrawals due to platelet counts after the company began monitoring the side effect, but the safety issue did not pass unnoticed.

In Novartis’ original deal with Akcea in January, the Big Pharma promised $225 million in near-term payments, split between fees, an upfront and an equity stake, and promising $1.13 billion more in development and commercialization milestones.

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