Collaborative Arrangements and Licensing Agreements

9 Months Ended

Sep. 30, 2021

Collaborative Arrangements and Licensing Agreements [Abstract]

Collaborative Arrangements and Licensing Agreements

5.  Collaborative Arrangements and Licensing Agreements

Below, we have included our Biogen and Novartis collaborations, which are our only collaborations with substantive changes during 2021 from those included in Note 6 of our audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020.

Strategic Partnership

Biogen

We have several strategic collaborations with Biogen focused on using antisense technology to advance the treatment of neurological disorders. These collaborations combine our expertise in creating antisense medicines with Biogen’s expertise in developing therapies for neurological disorders. We developed and licensed to Biogen SPINRAZA, our approved medicine to treat people with spinal muscular atrophy, or SMA. We and Biogen are currently developing eight investigational medicines to treat neurodegenerative diseases under these collaborations, including medicines in development to treat people with ALS, Alzheimer’s disease and Parkinson’s disease. In addition to these medicines, our collaborations with Biogen include a substantial research pipeline that addresses a broad range of neurological diseases. From inception through September 30, 2021, we have received more than $3.0 billion from our Biogen collaborations.

During the three and nine months ended September 30, 2021 and 2020, we earned the following revenue from our relationship with Biogen (in millions, except percentage amounts):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
SPINRAZA royalties (commercial revenue)	$	66.6		$	74.2		$	198.7		$	211.9
R&D revenue		17.4			51.2			63.4			98.6
Total revenue from our relationship with Biogen	$	84.0		$	125.4		$	262.1		$	310.5
Percentage of total revenue		63	%		78	%		71	%		71	%

Our condensed consolidated balance sheet at September 30, 2021 and December 31, 2020 included deferred revenue of $412.5 million and $465.8 million, respectively, related to our relationship with Biogen.

During the first nine months of 2021, we did not have any changes to our performance obligations, transaction price or the timing in which we expect to recognize revenue under our Biogen collaborations.

In April 2021, we earned a $10 million milestone payment from Biogen when Biogen advanced ION541, an investigational medicine targeting ATXN2 to treat patients with ALS. We recognized the milestone payment in full in the second quarter of 2021 because we did not have any remaining performance obligations related to the milestone payment. We will achieve the next payment of $8 million if Biogen advances one of the medicines under our 2013 strategic neurology collaboration.

Research, Development and Commercialization Partner

Novartis

In January 2017, we initiated a collaboration with Novartis to develop and commercialize pelacarsen. In February 2019, Novartis licensed pelacarsen. Novartis is responsible for conducting and funding future development and regulatory activities for pelacarsen, including a global Phase 3 cardiovascular outcomes study that Novartis initiated in the fourth quarter 2019. In connection with Novartis’ license of pelacarsen, we and Novartis established a more definitive framework under which the companies would negotiate the co-commercialization of pelacarsen in selected markets. Included in this framework is an option by which Novartis could solely commercialize pelacarsen in exchange for Novartis paying us increased sales milestone payments based on sales of pelacarsen. From inception through September 30, 2021, we have received $425 million from our Novartis collaboration.

In August 2021, we earned a $25 million milestone payment from Novartis when Novartis achieved 50 percent enrollment in the Lp(a) HORIZON Phase 3 cardiovascular outcome study of pelacarsen. We recognized the milestone payment in full in the third quarter of 2021 because we did not have any remaining performance obligations related to the milestone payment. We will achieve the next payment of up to $75 million if Novartis advances regulatory activities for pelacarsen.

Technology Enhancement Collaboration

Bicycle License Agreement

In December 2020, we entered into a collaboration agreement with Bicycle and obtained an option to license its peptide technology to potentially increase the delivery capabilities of our LIgand Conjugated Antisense, or LICA, medicines. In July 2021, we paid $42 million when we exercised our option to license Bicycle’s technology, which included an equity investment in Bicycle. As part of our stock purchase, we entered into a lockup agreement with Bicycle that restricts our ability to trade our Bicycle shares for one year. In the third quarter of 2021, we recorded a $7.2 million equity investment for the shares we received in Bicycle. We recognized the remaining $34.8 million as R&D expense in the third quarter of 2021. From inception through September 30, 2021, we have paid $45 million under our collaboration agreement with Bicycle.