ISIS PHARMACEUTICALS - Buena Vista Investment Management Morgan Healthcare... · This presentation includes forward- looking statements regarding Isis Pharmaceuticals’ financial

31ST Annual J.P. Morgan Healthcare Conference Stanley T. Crooke, M.D., Ph.D. Chairman of the Board & Chief Executive Officer January 9, 2013

ISIS PHARMACEUTICALS

This presentation includes forward-looking statements regarding Isis Pharmaceuticals’ financial position and outlook, Isis’ business, and the therapeutic and commercial potential of Isis’ technologies and products in development. Any statement describing Isis’ goals, expectations, financial or other projections, intentions or beliefs, including the planned commercialization of KYNAMRO, is a forward-looking statement and should be considered an at-risk statement. Such statements are subject to certain risks and uncertainties, particularly those inherent in the process of discovering, developing and commercializing drugs that are safe and effective for use as human therapeutics, and in the endeavor of building a business around such drugs. Isis’ forward-looking statements also involve assumptions that, if they never materialize or prove correct, could cause its results to differ materially from those expressed or implied by such forward-looking statements. Although Isis’ forward-looking statements reflect the good faith judgment of its management, these statements are based only on facts and factors currently known by Isis. As a result, you are cautioned not to rely on these forward-looking statements. These and other risks concerning Isis’ programs are described in additional detail in Isis’ annual report on Form 10-K for the year ended December 31, 2011 and its most recent quarterly report on Form 10-Q, which are on file with the SEC. Copies of these and other documents are available from the Company.

In this press release, unless the context requires otherwise, “Isis,” “Company,” “we,” “our,” and “us” refers to Isis Pharmaceuticals and its subsidiaries.

Isis Pharmaceuticals® is a registered trademark of Isis Pharmaceuticals, Inc. Regulus Therapeutics™ is a trademark of Regulus Therapeutics Inc. KYNAMRO™ is a trademark of Genzyme Corporation.

Forward Looking Language Statement

2

Kynamro: Commercialization on the Horizon

Maturing Pipeline Five drugs with launch potential in next five years Nine drugs with Phase 2 or Phase 3 data planned for 2013/early 2014 Two to three Phase 3 programs planned to initiate in 2013/early 2014

Expanding Pipeline Three new drugs in development Growing severe and rare disease program

Antisense Advances Generation 2.0 drugs more potent and better tolerated Generation 2.5 drugs significantly more potent than Generation 2.0

Partnering Success: Significant Interest Continues

2013 Goals

Overview Key Messages

3

Initiated third alliance with Biogen Idec in 2012 – total potential value ~$1.2B Extensive experience in neurology and drug development allows expansion of Isis’

severe disease pipeline

Initiated broad cancer research and development alliance with AstraZeneca worth ~ $1B Significant experience in cancer and broad collaborations allows expansion of Isis’

cancer pipeline

Amended and accelerated ISIS-TTRRx clinical path with GSK TTR Phase 3 program ready to start Fast Track designation for ISIS-TTRRx

Positive clinical data on four drugs ISIS-SMNRx, ISIS-PTP1BRx, ISIS-GCGRRx, ISIS-GCCRRx

Expanded pipeline with three new drugs (28 total) ISIS-PKKRx, ISIS-GSK3Rx, ISIS-AZ1Rx

Successful End for 2012 A Very Busy December

4

Isis’ Clinical-Stage Pipeline January 2013

5

Pipeline Key Indication Drugs Partner Phase I Phase II Phase III Reg & Comm

Cardiovascular Severe HeFHCADCAD

Clotting DisordersSevere & Rare CMV Retinitis

PouchitisHomozygous FHTTR Amyloidosis

Spinal Muscular Atrophy Severe HTGAcromegaly

Cushing's SyndromeMetabolic Diabetes

DiabetesDiabetesObesity

Cancer CancerCancerCancerCancer

Inflammation Inflammation& Other MS

Local FibrosisOcular Disease

Severe Bacterial Infection

ISIS-FXIRx

OGX-011ISIS-EIF4ERx

OGX-427

ISIS-STAT3Rx

ATL1102EXC 001iCo-007

Plazomicin

ISIS-SMNRx

ATL1103

ISIS-FGFR4Rx

ISIS-GCCRRx

ISIS-GCGRRx

ISIS-PTP1BRx

ISIS-TTRRx

KYNAMROTM

ISIS-APOCIIIRx

Vitravene®Alicaforsen

ISIS-CRPRx

ISIS-CRPRx

KYNAMROTM

ISIS-APOCIIIRx

ISIS-GCCRRx

*Named Patient Supply

Isis’ Clinical-Stage Pipeline Isis Wholly Owned Programs

6

Pipeline Key Indication Drugs Partner Phase I Phase II Phase III Reg & Comm

Cardiovascular Severe HeFHCADCAD

Clotting DisordersSevere & Rare CMV Retinitis

PouchitisHomozygous FHTTR Amyloidosis

Spinal Muscular Atrophy Severe HTGAcromegaly

Cushing's SyndromeMetabolic Diabetes

DiabetesDiabetesObesity

Cancer CancerCancerCancerCancer

Inflammation Inflammation& Other MS

Local FibrosisOcular Disease

Severe Bacterial Infection

ISIS-FXIRx

OGX-011ISIS-EIF4ERx

OGX-427

ISIS-STAT3Rx

ATL1102EXC 001iCo-007

Plazomicin

ISIS-SMNRx

ATL1103

ISIS-FGFR4Rx

ISIS-GCCRRx

ISIS-GCGRRx

ISIS-PTP1BRx

ISIS-TTRRx

KYNAMROTM

ISIS-APOCIIIRx


ISIS-CRPRx

ISIS-CRPRx

KYNAMROTM

ISIS-APOCIIIRx

ISIS-GCCRRx

Isis’ Pre-clinical Stage Pipeline January 2013

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Pipeline Key Indication Drugs Preclinical Phase I Phase II Phase III Reg & Comm

Cardiovascular CADClotting Disorders

Severe & Rare AAT Liver DiseaseHereditary Angioedema

Metabolic NASHCancer Cancer

Inflammation Anemia of Inflammation& Other Antiviral

ISIS-APOARx

ISIS-FVIIRx

ISIS-AATRx

ISIS-DGAT2Rx

XEN701

ISIS-GSK3Rx

ISIS-AZ1Rx

ISIS-PKKRx






ISIS-APOARx

ISIS-FVIIRx

ISIS-AATRx

ISIS-DGAT2Rx

XEN701

ISIS-GSK3Rx

ISIS-AZ1Rx

ISIS-PKKRx

Isis’ Pre-clinical Stage Pipeline January 2013

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New Development Candidates






ISIS-APOARx

ISIS-FVIIRx

ISIS-AATRx

ISIS-DGAT2Rx

XEN701

ISIS-GSK3Rx

ISIS-AZ1Rx

ISIS-PKKRx

Isis’ Pre-clinical Stage Pipeline Isis Wholly-owned Programs

9

FDA Advisory Committee recommended approval — Jan 29 PDUFA date

Preparing for commercial launch Focus on improving disease awareness and treatment of homozygous

FH patients

Re-examination of CHMP opinion requested by Genzyme; anticipate new opinion in 2Q 2013

Investing in the future – FOCUS FH study in severe FH patients ongoing (under SPA); projected completion in 2014

KYNAMROTM (mipomersen sodium) On the Threshold of Commercialization

10

Potential Drug Launches Through 2017

Drug Indication/Market Economics

ISIS-TTRRx

Familial Amyloid Polyneuropathy (FAP) ~10,000 patients

License fee, sales milestone payments and double-digit royalties

ISIS-SMNRx Spinal muscular atrophy (SMA) ~35,000 patients worldwide

License fee, milestone payments and double-digit royalties

ISIS-APOCIIIRx

Severe triglyceridemia (>880 mg/dL) at increased risk of recurrent pancreatitis ~200,000 patients in US & EU

Isis Owned

OGX-011 Castration-resistant prostate cancer (1st line) ~315,000 patients in US/EU

Milestone payments and single-digit royalties

EXC 001 Anti-scarring treatment estimated to be multibillion dollar market

Milestone and other payments and single-digit royalties

11

ISIS-TTRRx for Transthyretin (TTR) Amyloidosis A Fatal Genetic Disease Affecting ~50K Patients Worldwide

12

Partnered with:

Amyloid

Image from Benson MD, Kincaid JC. The molecular biology and clinical features of amyloid neuropathy. Muscle Nerve. 2007;36:411-423.

TTR amyloidosis is a rare genetic disease that results in progressive neurodegeneration and death TTR mutations cause the tetrameric TTR protein to be unstable TTR monomers accumulate, creating plaques in peripheral nerves, heart & other organs

as amyloid deposits, causing cell death Familial Amyloid Polyneuropathy (FAP) with ~10K patients worldwide

Age of onset : 30-50 years Life expectancy after diagnosis: 9-11 years

Familial Amyloid Cardiomyopathy (FAC) with ~40K patients worldwide Age of onset: 60-70 years Life expectancy after diagnosis: 5-6 years

Treatment options are limited. Liver transplant is the most

common treatment

ISIS-TTRRx: Phase 1 Healthy Volunteers Dose-Dependent Prolonged Reduction of Plasma TTR

13

ISIS-TTRRx produced robust and highly statistically significant reductions in TTR levels with good tolerability Sustained reductions in TTR with many subjects achieving >80%

reduction (several subjects reaching undetectable levels) at highest doses No SAEs, no clinically significant increases in liver enzymes or other

lab chemistries Very low

incidence of flu-like symptoms and mild injection site reactions

Partnered with:

ISIS-TTRRx Phase 3 Program Ready to Initiate

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Randomized Double-blind Placebo-controlled Phase 2/3 Study in Patients with Familial Amyloid Polyneuropathy

Approximately 200 FAP patients at about 20 global sites to receive 300 mg ISIS-TTRRx or placebo (2:1)

Study Objectives

Evaluate efficacy of ISIS-TTRRx as measured by neurological dysfunction and quality of life

Data planned for 2015

Screening & Baseline

Assessments

Post-Treatment f/u Period

6 months R 2:1

1 month

End of Treatment Efficacy

Assessments

Treatment Period

15 months

s.c. dosing (D1, D3, D5) followed by once weekly s.c. dosing

Partnered with:

Potential regulatory filing and commercial launch within the next five years

Initial focus in patients with FAP

Possibility for orphan pricing

Potential “best in class” treatment for all forms of TTR amyloidosis

Reduces all forms of TTR (mutant & normal)

Convenient once-weekly, at-home, self-administered s.c. dosing

Development plan for cardiomyopathy in process

Attractive economics

$80M in upfront payments and pre-licensing milestones

License fee, regulatory and sales milestones

Double-digit royalties

ISIS-TTRRx Rapid Path to Market

15

Partnered with:

ISIS-SMNRx for Spinal Muscular Atrophy (SMA) Severe Genetic Neuromuscular Disease Affecting Children

16

SMA is a rare disease that affects approximately 30-35K children in United States, Europe and Japan

Number one genetic cause of death in infants

Characterized by progressive muscle atrophy and loss of motor function

Caused by genetic defects in the SMN1 gene that result in the lack of functional SMN protein

No currently approved therapies for SMA

Partnered with:

ISIS-SMNRx Modulating RNA Processing to Positively Impact Disease

A related gene, SMN2, normally produces only a small amount of functional SMN protein because of inappropriate RNA processing

ISIS-SMNRx increases the production of functional SMN protein by promoting appropriate RNA processing

Partnered with:

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SMN-2 Gene

1 2 3 4 5 6 8 SMN-2 mRNA

1 2 3 4 5 6 7 8

C to T

ISIS-SMNRx keeps exon 7 in the RNA and leads to the production of functional SMN protein.

7

ASO

SMN-2 Gene

5 1 2 3 4 6 8 SMN-2 mRNA

1 2 3 4 5 6 7 8

C to T

SMN2 gene does not normally produce enough SMN protein to compensate for loss of SMN1 gene in patients with SMA. Splicing mechanism removes exon 7 resulting

in a shortened defective SMN protein.

ISIS-SMNRx Phase 1 Single-Dose Study in SMA Patients (Dosing Completed)

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Open-label, single-dose study to evaluate the safety and tolerability of ISIS-SMNRx in SMA patients 2-14 years of age

Intrathecal dosing was well tolerated

Feasibility of infrequent dosing demonstrated

Improvements in muscle function observed in a number of children

Abstract accepted for a special presentation at the American Academy of Neurology meeting in March 2013

Screening (≤28 days)

Post-Treatment In-Patient f/u Period

Day 1 Single Dose

24 hours Open Label

•4 weeks post dose (1 mg & 3 mg) •12 weeks post dose (6 mg & 9 mg)

Post-Treatment Evaluation Period

Cohorts n

1 mg 6

3 mg 6

6 mg 6

9 mg 10

Partnered with:

ISIS-SMNRx Phase 1b/2a Multiple-Dose Study in SMA Patients (Ongoing)

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Open-label, intrathecal, dose escalation study in SMA patients 2-15 years of age

Objectives Evaluate the safety and tolerability of multiple doses of ISIS-SMNRx Evaluate biomarkers and clinical outcomes related to SMA Determine dose and dose interval for Phase 3 study Determine appropriate Phase 3 endpoints

Data planned for late 2013/early 2014

Screening (≤28 days)

Post-Treatment In-Patient f/u Period

Day 1 Dose

3 mg, 6 mg, 9mg cohorts

24 hours Open Label

Cohorts n

3 mg 8

6 mg 8

9 mg 8 Day 29 f/u & Dose

3 mg & 6 mg cohorts

Day 85 f/u & Dose

3 mg, 6 mg, 9mg cohorts

24 weeks


19

Partnered with:

ISIS-SMNRx Rapid Path to Market

20

Potential regulatory filing and commercial launch within the next five years

Granted Orphan Drug Status in US and EU and Fast Track Designation in US

Two pivotal studies planned to start in 2013/early 2014

Infant onset Phase 2/3 study

Childhood onset Phase 2/3 study

Attractive economics

$74M in upfront payment and pre-licensing milestones

$225M in license fee and milestone payments

Double-digit royalties

Partnered with:

ISIS-APOCIIIRx for Severe Hypertriglyceridemia An Isis-owned Rare-disease Opportunity

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More than 200K patients in US and EU with severe hypertriglyceridemia (HTG) (triglycerides of >880 mg/dL)

Significant risk of developing recurring pancreatitis, often requiring multiple hospitalizations and may require surgery

High risk for cardiovascular disease

Standard therapies, including niacin, fibrates and fish oil are inadequate

Potential for broader utility in cardiovascular disease and metabolic syndrome, including diabetes

ISIS-APOCIIIRx Phase 1 in Healthy Volunteers Dose-Dependent Reduction in Fasting and Diet-Induced Triglycerides

* * * Fasting TGs increase due to high-fat diet

22

Safety Summary No SAEs, no clinically significant increases in liver

enzymes or other lab chemistries

No flu-like symptoms and very low incidence of mild injection site reactions

Screening &

Diet Run-in


12 weeks R

Treatment Period 13 Weeks

ISIS-APOCIIIRx Two Phase 2 Studies Planned to Complete in 2013

23

Severely Elevated Triglyceride Study, ~100 Patients with Triglycerides between 440-2000 mg/dL (Ongoing) Study designed to demonstrate that ISIS-APOCIIIRx can decrease triglycerides and apoC-III in

patients with severely elevated triglycerides Doses: 100, 200, or 300 mg/wk Data planned for mid 2013

Moderate Elevated Triglyceride in Type II Diabetics Study, ~25 Patients with Uncontrolled

Glucose Levels and Triglycerides between 200-500 mg/dL (Ongoing) Study designed to demonstrate that ISIS-APOCIIIRx can decrease triglycerides and apoC-III in

type II diabetes patients with moderately elevated triglycerides Exploring multiple measures of insulin sensitivity Dose: 300 mg/wk Data planned for late 2013

≤8 weeks Weekly dosing

End of Treatment Efficacy

Assessments

ISIS-APOCIIIRx Rapid Path to Market

Potential regulatory filing and commercial launch within next five years

Phase 3 study in patients with severe hypertriglyceridemia (TG > 880 mg/dL) Planned to begin late 2013/ early 2014

Isis wholly owned program

24

Advancing the Pipeline Numerous Drugs with Phase 2 or Phase 3 Data Potentially in 2013/Early 2014

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Drug Indication Studies Study Phase

OGX-011 Cancer Prostate Cancer Phase 3

ISIS-FXIRx Thrombosis Total Knee Replacement Phase 2

ISIS-CRPRx Inflammation Cardiovascular Disease

Endotoxin RA Atrial Fibrilation

Phase 2

ISIS-EIF4ERx Cancer Lung Cancer Prostate Cancer Phase 2

ISIS-APOCIIIRx Severe Hypertriglyceridemia (HTG)

Severe HTG Moderate HTG Phase 2

ISIS-SMNRx Spinal Muscular Atrophy (SMA) SMA (childhood onset) Phase 2

ISIS-STAT3Rx Cancer Lymphoma Phase 2

OGX-427 Cancer Prostate Cancer Phase 2

iCo-007 Ocular Diabetic Macular Edema Phase 2

Advancing the Pipeline Numerous Drugs with Phase 2 and Phase 3 Studies Potential to Start in 2013/Early 2014

26

Drug Indication(s) Studies Planned Study

ISIS-TTRRx Familial Amyloid Polyneuropathy (FAP) FAP Phase 2/3

ISIS-APOCIIIRx Hypertriglyceridemia (HTG) Severe HTG Phase 3

ISIS-SMNRx Spinal Muscular Atrophy (SMA) SMA (infantile onset) Phase 2/3

ISIS-GCCRRx Cushing's Syndrome Type 2 Diabetes

Cushing's Syndrome Type 2 Diabetes

Phase 2 Phase 2

ISIS-GCGRRx Type 2 Diabetes Type 2 Diabetes Phase 2

ISIS-PTP1BRx Type 2 Diabetes Type 2 Diabetes Phase 2

ISIS-STAT3Rx Cancer Cancer Phase 2

2013 Partnering Opportunities Unpartnered Drugs with Phase 2 Efficacy Data Planned in 2013/Early 2014

27

Drug Indication(s) Studies

ISIS-APOCIIIRx Severe Hypertriglyceridemia (HTG)

Severe HTG Moderate HTG

ISIS-FXIRx Thrombosis Total Knee Replacement

ISIS-CRPRx Inflammation Cardiovascular Disease

Endotoxin, RA Atrial Fibrilation

ISIS-EIF4ERx Cancer Lung Cancer Prostate Cancer

ISIS-FXIRx for Thrombotic Disorders Potential Multibillion Dollar Commercial Opportunity

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Thrombosis, a major component of cardiovascular disease, is one of the leading causes of death in the western world The formation or presence of a blood clot can occur suddenly and result in death

Current treatments to prevent blood clots often result in an unacceptably high risk of bleeding which can also result in death

There is significant need for a treatment to prevent blood clots, with less bleeding, in diseases where warfarin and Factor Xa and Factor IIa are currently used Acute Coronary Syndromes (ACS)

Stroke Prevention

Venous Thromboembolism (VTE), including Pulmonary Embolism (PE) and Deep Vein Thrombosis (DVT)

Potential significant near-term licensing opportunity

Factor Xl ASO

0 20 40 60 80

100 120 140 160

1.25 2.5 5 10 20 40 FXI ASO (mg/kg)

Thro

mbo

sis

(n

orm

aliz

ed)

-0.2

0

0.2

0.4

0.6

0.8

Tail

Ble

edin

g

(Blo

od/g

ram

s) Thrombosis Bleeding

Factor Xa Small Molecule

0 20 40 60 80

100 120 140 160

0.5 2 5 10 20

Apixaban (mg/kg)

Thro

mbo

sis

(n

orm

aliz

ed)

0

0.2

0.4

0.6

0.8 Ta

il B

leed

ing

(B

lood

/gra

ms)

Thrombosis Bleeding

Thrombosis Bleeding

Warfarin

0 20 40 60 80

100 120 140 160

0.5 1 2 3 4 5

Warfarin (mg/kg)

Thro

mbo

sis

(n

orm

aliz

ed)

0

0.2

0.4

0.6

0.8

Tail

Ble

edin

g

(Blo

od/g

ram

s)

ISIS-FXIRx demonstrated potent antithrombotic activity with no increase in bleeding compared to standard anti-clotting agents, including low-molecular weight heparin,

warfarin and Factor Xa inhibitors (all of which increased bleeding)

ISIS-FXIRx Preclinical Data Efficacy without Increased Bleeding

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In Phase 1 study, ISIS-FXIRx demonstrated robust, sustained and dose-dependent reduction in FXI activity without increases in bleeding or bruising Maximum reduction achieved with 200 mg and 300 mg doses

No clinically significant increases in liver enzymes or other lab chemistries

Very low incidence of flu-like symptoms and mild injection site reactions

ISIS-FXIRx Profile of a Potential Best-in-Class Antithrombotic Agent

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ISIS-FXIRx Phase 2 Study (Ongoing)

31

Open-label, Randomized, Active Comparator-Controlled, Multicenter (Canada and Eastern Europe) Study in Patients Undergoing Total Knee Arthroplasty (TKA)

Objectives Evaluate the safety and efficacy, including incidence of bleeding and VTE

and compare to enoxaparin


Cohorts ISIS-FXIRx

n

100mg 100

200mg 100

300mg 100

*For the comparator arm, patients will be treated with enoxaparin (40 mg, s.c.) on the evening before surgery, the day after surgery and for 8 additional days

Screening wk1 wk2 wk3

12 wks 3:1 R

Surgery Treatment

8-12 d

Bilateral Venography

3 wks 3 wks


ISIS-CRPRx – Targeting C-Reactive Protein (CRP) Potential Multibillion Dollar Commercial Opportunity

32

CRP is elevated in many inflammatory diseases and diseases with inflammatory components, such as Acute Coronary Syndrome (ACS) Atrial Fibrillation (AF) Rheumatoid Arthritis (RA) Chronic Kidney Disease (CKD) End Stage Renal Disease (ESRD) Organ Transplant

Elevated CRP levels are associated with increased disease burden

CRP is a complex glycoprotein, making it difficult to specifically target with small molecule drugs

Large commercial opportunity Potential broad applications in a number of diseases exacerbated by inflammation Market for inflammatory disease estimated to be > $20B

Potential significant near-term licensing opportunity

ISIS-CRPRx The First Selective CRP Lowering Drug in Man

33

Subjects with elevated CRP levels had a median reduction of >70% compared to baseline

ISIS-CRPRx was well tolerated at doses up to 600 mg/week

No SAEs, no clinically significant increases in liver enzymes or other lab chemistries

Very low incidence of flu-like symptoms and mild injection site reactions

ISIS-CRPRx Lowers CRP in Healthy Volunteers

Phase 1 clinical study demonstrated that ISIS-CRPRx produced statistically significant reductions in CRP

ISIS-CRPRx – Multiple Clinical Readouts in 2013 Designed to Produce Compelling Data Showing Therapeutic Benefit of Reducing CRP

Endotoxin Challenge Study in ~30 Healthy Volunteers (Completed) Study designed to demonstrate that ISIS-CRPRx can blunt acute severe

increases in CRP Exploring other key inflammatory mediators such as TNF-α, IL-1β, IL-6

and complement Data planned for 1H 2013

Phase 2 Study in ~ 50 Patients with Rheumatoid Arthritis (Ongoing) Study designed to demonstrate benefit of lowering CRP in patients with

chronically elevated CRP levels Data planned for mid 2013

Phase 2 Study in ~ 20 Patients with Atrial Fibrillation (Planned Start 1H 2013) Study designed to demonstrate CRP reduction has a positive effect on the

duration and frequency of atrial fibrillation events Data planned for 1H 2014

34

Isis’ Severe and Rare Disease Pipeline Expanding One the of Largest Severe and Rare Disease Programs in Biotech

35


Severe & Rare CMV RetinitisPouchitis

Homozygous FHTTR Amyloidosis

Spinal Muscular Atrophy Severe HTG

Cushing's SyndromeAcromegaly

AAT Liver Disease

ISIS-SMNRx

ISIS-GCCRRx

ATL1103

ISIS-TTRRx

KYNAMROTM

ISIS-APOCIIIRx


ISIS-AATRx


Isis’ Severe and Rare Disease Pipeline Expanding One the of Largest Severe and Rare Disease Programs in Biotech

36 36


Severe & Rare CMV RetinitisPouchitis

Homozygous FHTTR Amyloidosis

Spinal Muscular Atrophy Severe HTG

Cushing's SyndromeAcromegaly

AAT Liver DiseaseHereditary Angioedema

ISIS-SMNRx

ISIS-GCCRRx

ATL1103

ISIS-TTRRx

KYNAMROTM

ISIS-APOCIIIRx


ISIS-AATRx

ISIS-PKKRx


Hereditary Angiodedema (HAE) is a potentially life threatening immune disease Characterized by low levels or dysfunction of the C1 inhibitor protein HAE patients have attacks of rapid and painful swelling in the hands, feet,

limbs, face, abdomen, larynx and trachea

Current prophylactic treatments (androgens) are either inadequate or very difficult to use Example: Cinryze IV 3x/week administered in the hospital setting

Average cost $300,000 per patient for Cinryze prophylaxis

Unmet need: Up to 80% of patients are not using IV prophylaxis and would use a s.c. prophylactic if effective and available

ISIS-PKKRx for Hereditary Angioedema Approximately 15-20K Patients in US and EU

37

Prekallikrein (PKK) is the precursor of plasma kallikrein, a serine protease that activates kinins. PKK is cleaved to produce kallikrein by Factor XIIa

ISIS-PKKRx A Clinically Validated Target

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PKK disrupts the kinin contact cascade that results in Hereditary Angioedema (HAE) attacks

The role of kinins in HAE has been established by acute treatments used after an attack has already occurred

ISIS-PKKRx will be used as prophylaxis for patients with frequent HAE attacks in a convenient once weekly subcutaneous injection

New Mechanisms RNA Processing/Splicing Single-stranded RNAi

New Routes of Delivery Intrathecal Intradermal

Better Performance Improved screening produces more potent and better

tolerated 2nd Generation antisense drugs 2.5 Generation antisense drugs even more potent

Advancing Antisense Technology New Mechanisms, New Routes of Delivery, Better Performance

39

Advancing Antisense Technology Improved Screening Generates More Potent Generation 2.0 Antisense Drugs

40

Dose Level (mg) ISIS-APOCIIIRx ISIS-FXIRx ISIS-TTRRx

100 -25% (1.2X) -49% (2X) -23% (1.1X)

200 -71% (1.8X) -71% (1.8X) -53% (1.5X)

300/400 >-78% (>1.5X) >-90% (>1.8X) >-75% (>1.5X)

Greater Reduction of Target Protein after 4 Weeks of Treatment (Fold Improvement vs. Kynamro )

Conclusion: Newer Generation 2.0 antisense drugs are more potent than Kynamro

Advancing Antisense Technology Improved Screening Enhances Tolerability Profile of Gen 2.0 Antisense Drugs

41

Parameter ISIS-APOCIIIRx ISIS-FXIRx ISIS-TTRRx

Injection-site Reactions (% SC Injections)

89% fewer ISRs 64% fewer ISRs 65% fewer ISRs

Flu-like Symptoms None reported None reported

None reported

Improvement in Nuisance Side Effects Observed in Newer 2nd Generation Antisense Drugs Compared to Kynamro

Experience with ISIS-STAT3Rx demonstrates: Gen 2.5 drugs are up to 10x more potent than previous

Gen 2.0 drugs

Gen 2.5 drugs have good tolerability with evidence of durable response in patients with diffuse large B-cell lymphoma


Advancing Antisense Technology Improved Potency Demonstrated with Generation 2.5 Antisense Drugs

42

After Treatment (2 mg/kg) Before Treatment

55% response observed in 63 year old female with

diffuse large B-cell lymphoma

Partnered with:

No evidence of chronic systemic inflammation in man

Injection site reactions are now readily managed and declining with patient and physician education and use of a prefilled syringe

Clean carcinogenicity studies No clinically relevant findings

Antisense Technology Lessons Learned from Kynamro Development

43

Partner programs at earlier stages of development in therapeutic areas with higher risk (e.g., neuro and cancer) and where Phase 2 data will not provide a large increase in value

Defer license fees with manageable and relatively inexpensive Phase 2 programs where results will cause significant value inflection

Unique partner strategy for each program to maximize value

Superior down stream economics

Isis controls earlier-stage development

~$2B in cash from partnerships to date

Isis’ Partnering Progress Business Strategy Maximizes Value and Minimizes Risk

44

Isis Financial Position September 30, 2012 (in millions)

45

Revenue Operating Expenses – Pro forma (1)

Loss from Operations – Pro forma (1)

At September 30, 2012

$ 344 201 37 70

170

3 Months Ended, September 30

2012 2011

$ $ 12 38

(26)

21 41

(20)

9 Months Ended, September 30

2012 2011

$ $ 82 118 (36)

67 112 (45)

Cash & Short-term Investments

2¾% Convertible Notes (2)

Deferred Revenue (Long-term Portion) Long-term Financing Liability for Leased Facility (3)

Stockholders’ Equity We expect to end 2012 with more than $300M in cash and a pro forma 2012 NOL in the mid $70M range. (1) Amounts exclude non-cash compensation expense related to equity awards.

(2) Amount represents the principal balance of our 2¾% Convertible Notes. On the balance sheet, the carrying value of these notes is $142.5M because accounting rules required us to record the notes at a discount based on the estimated fair value of similar debt without the conversion feature.

(3) Accounting rules required us to record the cost of our leased facility as a fixed asset with a corresponding liability.

Kynamro commercialization

Positive Phase 2 and Phase 3 data from up to nine programs ISIS-APOCIIIRx, ISIS-FXIRx, ISIS-CRPRx, ISIS-SMNRx, ISIS-STAT3Rx, ISIS-

EIF4ERx, iCo-007, OGX-011, OGX-427

Initiation of two to three Phase 3 studies ISIS-TTRRx, ISIS-SMNRx, ISIS-APOCIIIRx

Initiation of four additional Phase 2 studies ISIS-STAT3Rx, ISIS-GCCRRx, ISIS-GCGRRx, ISIS-PTP1BRx

Additional partnering opportunities with three to four mature programs ISIS-APOCIIIRx, ISIS-FXIRx, ISIS-CRPRx, ISIS-EIF4ERx

Maintain strong financial position

2013 Goals

46

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Thank You For Joining Us!

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ISIS PHARMACEUTICALS - Buena Vista Investment Management Morgan Healthcare... · This presentation includes forward- looking statements regarding Isis Pharmaceuticals’ financial