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Executives

Dr. Stanley Crooke - CEO

Kristina Lemonidis - Director Corp. Communications

Lynne Parshall - COO, CFO

Richard Geary - SVP Development

Walter Singleton - CMO, VP Development

Joseph Witztum - Professor of Medicine, UCSD

Analysts

Chad Messer - Needham Company

Ted Tenthoff - Piper Jaffray

Stephen Willey - Stifel Nicolaus

Carol Werther - Summer Street

Isis Pharmaceuticals, Inc. (ISIS) Clinical Development Plans for ISIS-APOCIIIRx Call May 4, 2012 11:00 AM ET

Good day ladies and gentlemen and welcome to Isis Pharmaceuticals' apoC-III conference call. Leading the call today from Isis is Dr. Stanley Crooke Isis' Chairman and CEO. Dr. Crooke, please begin.

Dr. Stanley Crooke

Thanks, Derrick and thanks to everyone for joining us today. Today we plan to discuss our novel triglyceride lowering drug that targets apoC-III, the severe patient needs this drug is designed to address and our development plans to get this important new drug to patients in need.

Joining me on the call today are Lynne Parshall, COO & CFO; Richard Geary; Senior Vice President of Development; Walter Singleton; Chief Medical Officer and Vice President of Development and Kristina Lemonidis, Director of Corporate Communications. We are also very pleased to be joined today by Dr. Joseph Witztum, Professor of Medicine at the University of California, San Diego. Kris, will you read our forward-looking language statement please.

Kristina Lemonidis

Thanks Derrick. Thanks, Stan. A reminder to everyone on this webcast includes forward-looking statements regarding the development activities, therapeutic and commercial potential and safety of ISIS-APOCIIIRx. Any statement describing Isis' goals, expectations, financials 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 in human therapeutics, and in the endeavor of building a business around such drugs. Isis' forward-looking statements also involve assumptions that, if never materialized or proved 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 which is on file with the SEC. Copies of these and other documents are available from the company.

And with that, I'll turn the call back over to Stan.

Dr. Stanley Crooke

Thanks Kris. We are very pleased today to announce the initiation of the Phase 2 study that will evaluate the efficacy and safety of our drug designed to inhabit apoC-III. And this study will measure the ability of our drug to reduce apoC-III and triglycerides in patients with triglycerides greater than 500 mg/dL. On the call today we will focus on ISIS-APOCIIIRx and the significant near-term commercial opportunity it presents. But before we do that, Lynne will outline how Isis apoC-IIIRx fits into the potential value drivers for Isis in the company.

Lynne Parshall

Thanks Stan. With the pipeline of 26 drugs in development and a strong lineup of partners we have multiple ways to grow the value of Isis. Of course our first commercial opportunity is KYNAMRO which we expect Genzyme to launch this year.

Regulatory filings have been submitted in Europe and the United States. We are well along in the regulatory process in Europe, initially our largest market for KYNAMRO and the United States process is also proceeding. Genzyme is finalizing the launch activities for KYNAMRO to support the 2012 launch in Europe and an early 2013 launch in United States.

We believe Genzyme and Sanofi's experience and expertise in launching novel and valuable medicines worldwide will maximize KYNAMRO's commercial potential. Genzyme and we believe that the first indication for KYNAMRO represents a significant commercial opportunity. Our initial and initially largest indication in Europe should include both hoFH and the severe heFH is estimated to be estimated 18,000 patients.

In the United States our initial indication should be in hoFH which is about 3000 patients. Genzyme has a global marketing and selling plan intended to ensure that that they fully penetrate these initial markets. In addition we and Genzyme are investing to expand the commercial opportunities for KYNAMRO beyond these initial markets.

The ongoing FOCUS FH study is designed to support expanding the initial indications for KYNAMRO and to provide an alternative dosing regimen for those patients who prefer to take KYNAMRO three times a week. A successful FOCUS FH study should allow us to expand the United States market to include patients with severe heFH and to offer patients the alternative dosing regimen both in the 2015-2016 timeframe.

Following the US and European approvals Genzyme plans to launch KYNAMRO in other markets across the world in patients with severe heFH, another estimated 9000 patients and of course Genzyme plans to complete the necessary requirement to expand the indication for KYNAMRO to include heFH patients such as those with LDLs greater than 60 mg/dL in Europe. We are looking to launching this drug in our initial markets. We believe our strategy to ensure long-term growth opportunities for KYNAMRO is attainable and progressing well.

KYNAMRO harbors just the start of what we believe could be a steady stream of revenue growth for Isis. First there are a number of products in our pipeline that we believe represent potential product launches over the next five years. These drugs have the potential to be commercialized as early as 2016.

So these drugs could enter the market and generate revenue. At the same time the KYNAMRO patient populations are expanding and generating revenue growth. We consider our TTR, SMN and apoC-III drugs as our next significant near-term commercial opportunities that we are developing. For these drugs that initially target patients with rare and severe diseases, we have designed development plans intended to rapidly reach the market.

We have excellent committed partners for our TTR and SMN drugs and we will benefit from milestone payments, licensing fees and royalties as these drugs move to the market as well as from the significant development commercial expertise our partners share with us.

We plan to bring apoC-III quickly into registration studies next year to support a filing for a small very sick population at great risk of pancreatitis and cardiovascular events. Then as we are doing with KYNAMRO we plan to expand the indications for ISIS-APOCIIIRx. Richard will spend some time on the call today outlining our development plan for our apoC-III drug. In addition, there is several near term commercial activities opportunities with partner drugs in our pipeline.

Recently Pfizer acquired Excaliard Pharmaceuticals and the right to EXC 001, a drug for the local treatment for scarring associated with surgery. EXC 001 was a drug we discovered and licensed to Excaliard. And we believe that Pfizer's development and commercialization muscle ensures that this drug will move quickly to the market because plastic surgery is widely used and so frequently associated with unwanted scarring, we believe this drug can be a major market opportunity.

Also our partners at OncoGenex and Teva are continuing to enroll patients in the Phase 3 study for OGX-011 in prostate cancer and plan to report data from the study next year. So we believe that both of these partner drugs could reach the market in near term. Our economic interests in both drugs ensures that we will benefit financially from milestone payments associated with the key regulatory accomplishments and royalties on the sale of these drugs.

In addition to the multiple near-term commercial opportunities, a number of drugs in our pipeline could represent very valuable licensing opportunities. We plan on having robust Phase 2 data packages to support licensing opportunities for at least five of our programs in the next two years.

These are drugs that could represent blockbuster commercial opportunities. Among these near-term licensing opportunities are our factor XI anticoagulant drug factor and our CRP lowering drug.

Both of these drugs could be used to treat many different diseases that represent broad therapeutic opportunities and large markets. We also expect a number of drugs in our metabolic franchise to move them into Phase 2 studies next year which should then be completed in the 2013-2014 timeframe. Each represents a unique approach to the treatment of Type 2 diabetes. So while KYNAMRO leads the way, we believe our broad R&D pipeline should provide us with many opportunities for continued revenue growth in the future.

And now I would like to turn the call over to Dr. Joe Witztum give us some insights on treating Hypertriglyceridemia patients and why APOCIII drug may make a lot of sense for this under served patient population.

Dr. Witztum is a Professor of Medicine in the Department of Medicine and he is the Director of the Specialized Center for Research on Arteriosclerosis at the University of California, San Diego. He is Manager of the Journal of Lipid Research and world-recognized lipidologist. And with did Dr. Witztum.

Dr. Joseph Witztum

Thank you, Lynne. I am pleased to be associated with Isis. I’ve been involved in research to try to understand how high lipid levels cause Atherosclerosis and I’ve been doing this since the 1970s. And I also run a University-based tertiary referral center where I see patients with lipid disorders and early coronary artery disease.

Although, [stents] have been wonderful additions and we use them widely, there still is a great need for other agents. And it was in that context that I actually introduced myself to Isis a number of years ago to try to get them interested in our project to make an ASO to LPA to lipoprotein. Isis has a very unique approach that is different than others and has developed a novel platform that directly and specifically can inhibit production of any given protein and I thought that was a very unique and valuable approach.

Among the areas where new agents are really needed is in the area of elevated triglyceride levels. So there really is, sort of, three types of problems. One diverse problem is illustrated on this slide and it represents patients that have extremely high triglycerides that is above a 1,000. These patients who have plasma that looks this end up in the medical emergency rooms and in hospitalizations because triglycerides that are very high like this leads to pancreatitis which is a severe pain in the abdomen and this can even end up resulting life threatening pancreatitis, which requires even surgery.

This is actually one of the common consoles I get as a lipidologist for patients in the hospital, and you can see on the slide; on the left side is a plasma in such a person. And actually you will probably thank yourself well it looks like milk, and the fact that it (Inaudible) what milk is, milk is the collection of very large triglyceride-rich lipoproteins that come from the intestine and from the liver and when they become very, very high, that’s what it looks like and you can imagine that’s not very helpful.

The problem is there really is no effective drug therapy for patients with such very high triglyceride levels, treatments that one uses for people with lower triglycerides such as niacin or fibrates for example or fish oils, really don’t work in this clinical setting. And the only real therapy is to remove fat in the diet and on occasions because that takes a while to be effective. One even has to do plasmapheresis where a very invasive procedure where triglycerides are literally physically removed.

Now the second sort of use that we see, needs that we have or patients who have triglycerides that are much lower than that, say, between 500 and 1000, this is a very common problem. The example I showed you earlier is very small example but this is very common and patients with a triglyceride levels are associated with obesity and insulin sensitivity and that make Type 2 diabetes much worse. Such patients have elevated APOCIII which inhibits the removal of triglycerides and third point is that both high triglycerides and high APOCIII are validated and independent risk factors for coronary vascular disease.

There are no current therapies in my opinion that effectively lower the very high triglycerides associated with pancreatitis and even the therapies we use for patients with moderate hypertriglyceridemia are not very effective and have many side effects. These include, for example, niacin, fibrates and even fish oils.

Now ISIS-APOCIIIRx directly inhibits the synthesis of apoC-III and in the studies conducted today have shown dramatic decreases in both apoC-III and in triglyceride levels and a very favorable safety profile and tolerability has been observed. So I am very excited about the approach that ISIS has taken which is to concentrate first on those with the highest triglyceride levels and which will provide a critically important questions also APOCIII and triglyceride.

Again because the ISIS-APOCIIIRx is specific to apoC-III, these studies will answer important questions about the overall importance of apoC-III to triglyceride levels at the clinical level. I actually am very happy to be a part of a growing franchise that ISIS has created and expect many new advances in therapy will be forthcoming that will be a great benefit to reducing cardiovascular disease.

With that I will turn the call over to Richard Geary to walk us through the development plans for ISIS-APOCIIIRx.

Richard Geary

Thank you Dr. Witztum. As you just heard, very high triglycerides are a serious problem and not just here in the US, a global problem. As Dr. Witztum said, current therapies do not effectively treat patients with hypertriglyceridemia and some of them may have severely high triglycerides. In the most severe form, triglyceride levels may be greater than a thousand mg/dl. Just to put that into perspective a triglyceride level of a thousand mg/dl is approximately ten times the recommended optimal levels for triglycerides. So these are patients with a desperate need (inaudible) today’s therapies are grossly inadequate.

As Dr. Witztum mentioned patients with severely elevated triglycerides are at significant risk to develop pancreatitis and because their triglyceride levels remain high, pancreatitis frequently recurs. Pancreatitis is an inflammation of the pancreas, a gland that releases enzymes that aids digestion and pancreatitis is a serious medical emergency with no specific treatment.

Patients who develop pancreatitis experience severe abdominal pain, fever nausea and are often required to stay in the hospital until their symptoms resolve. The most severe form of pancreatitis, acute necrotizing pancreatitis is a life-threatening situation. The medical cost of caring for patients with acute necrotizing pancreatitis is enormous. So patients with this severe form of pancreatitis undergo intensive medical care and may require multiple surgeries to remove the necrotic pancreatic material, reducing their triglyceride levels to prevent pancreatic events in patients with severe elevated triglycerides.

So we believe that a drug that could significantly reduce triglyceride levels in these very said patients could provide substantial therapeutic benefit immediately by reducing their risk of pancreatitis but also in the long term by reducing their cardiovascular risk. The role of apoC-III in slowing down triglyceride from the blood is well understood and recent literature suggests that elevated levels of apoC-III alone add significant risk.

This is a cartoon that shows the role of apoC-III and how apoC-III inhibits clearance of triglycerides from the blood. Triglycerides are cleared from the blood by the enzyme lipoprotein lipase or LPL. ApoC-III inhibits this enzyme LPL thereby impeding triglyceride clearance. ISIS-APOCIII then blocks the synthesis of apoC-III allowing the LPL enzyme to clear triglycerides from the blood.

So apoC-III is also a genetically validated target. In the old world Amish population, there is a known mutation in the apoC-III gene that reduces the ability of apoC-III to inhibit triglyceride clearance. These family members have reduced cardiovascular risk, enhanced health and extraordinary longevity.

On the other side of the equation are the apoC-III gene variance in the eastern Indian males who have an increase in apoC-III circulating levels and a tremendous increase in their fasting triglyceride levels. As a consequence, these individuals have reduced triglyceride clearance and an increased incidence of cardiovascular disease as well as nonalcoholic steatosis of the liver or NASH and insulin resistance. The drug did not only lower’s triglycerides, but also apoC-III may provide these individuals with tremendous therapeutic benefit.

We are planning a prudent stage development plan for ISIS-APOCIIIRx; similar to the KYNAMRO development path, develop focusing first on the highest unmet medical need.

For ISIS-APOCIIIRx, the patients with the highest unmet need, need to have severely high triglycerides despite currently available therapies and are at the greatest risk. Some of them have a specific genetic predisposition and severely high and difficult to control levels of triglycerides.

Our development plan is designed to get our drug to the patients with the largest need first. So this is a small group of patients with severe disease who cannot get their triglyceride levels under control despite taking naturally tolerating existing therapy.

Based on prevalence data, we estimate there are approximately 3 million people in the United States and Europe today with triglycerides greater than 500 milligram per deciliter. These are patients who despite currently available therapies are still significantly over the normal upper limit of triglycerides. Many of them have other related disorders such as high LDL-C, elevated Lp(a) high VLDL or low HDL.

Frequently, these patients have insulin sensitivity issues putting them in the growing ranks of patients with metabolic syndrome and Type 2 diabetes. Within this group, there is a smaller subset of patients with triglycerides greater than 1000 milligrams per deciliter. We expect this subset of patients which we believe is more than 200,000 in the United States and Europe to be our initial patient population for commercialization. We believe our accelerated development plan could support submission for registration in this population as earliest 2016.

As with LDL-C, there are acceptable levels of triglycerides of course. Triglyceride levels of less than 150 milligram per deciliter is considered normal and acceptable, however, the American Heart Association recommends that triglyceride level of 100 milligram per deciliter or lower is optimal for heart health.

Triglyceride levels greater than 200 milligram per deciliter is considered high and triglyceride levels greater than 500 milligram per deciliter are considered very high. A simple blood panel can provide key information on triglyceride levels and patients with severely elevated triglycerides are often referred to the lipidologists.

Unfortunately, the only therapeutic option available to these lipidologists is simply increasing doses of currently available medicines and placing the patient on very strict diet. If the patient is not respond well or cannot tolerate these medications they have no other therapeutic process. We believe our drug could give these physicians a new and powerful tool to reduce the disease burden in these patients.

Currently, as Dr. Witztum as said the primary therapy (inaudible) and optimum successful is diet. Niacin is used in the United States in those patients for whom flushing is not a limiting adverse effect. On Niacin these patients can reduce their triglycerides levels between 20% and 50%. The side effects of Niacin however have limited use and it’s not widely use outside of the United State. So for patients who cannot take Niacin, they can take fibrates over-the-counter prescription fish oil. And while these are generally better tolerated to Niacin, they are also associated with side effects and are often less efficacious.

We believe that ISIS-APOCIIIRx could also be added to existing therapies to further reduce triglycerides in these patients. Our Phase I data support our optimism for this drug. In this line, you see that our drug significantly reduced apoC-III in a clear thus dependent manner with two subjects in the 400 milligram for reaching undetectable levels of apoC-III.

On treating patients with high triglycerides, the physician would want to lower the average triglyceride level and also ideally reduce (inaudible) diet induce level of triglycerides. In our Phase I study we observed medium triglyceride reductions of 44% with a positive effect on diet induced elevations in triglycerides.

In this graph you can see increases in triglycerides due to patients being fed a high carbohydrate diet during the fist week and again on day 22. if you compare the top-line, the blue line, which is placebo to the three cohorts, you will see there our drug attenuated much of the increases in triglyceride levels that the diet induced high fat meals. So we not only saw reductions in apoC-III, and triglycerides, by reducing apoC-III, we were able to block triglyceride increases following a high fat meal.

And of course, we were also very pleased with the safety profile of the drug in this study. With no significant adverse events, a very low incidence of injection side reactions and we saw no changes in the liver enzymes even for those subjects whose plasma apoC-III was reduced to undetectable levels.

Today, we announced the initiation of our Phase II program, which is designed to provide us with efficacy data in patients. The Phase II study is a randomized placebo control does escalation study to evaluate the effects of our drug in patients with hypertriglyceridemia.

Patients in this study were who have very triglycerides of 500 milligram per deciliter or higher. Approximately half of the patients in this study as we plan to enroll in this study will have a genetic defect that makes their triglyceride levels extremely high. These patients have a heterozygous defect in their lipoprotein lipase or LPL gene. I cannot breakdown efficiently from digested food so that the fat particles still doesn’t apply.

By reducing apoC-III, we believe we can decrease the amount of circulating triglyceride both before and after meals in these patients. This study will evaluate the effects on our drug over three months treatment and we expect to enroll approximately 100 patients. We will evaluate our drugs monotherapy and in combination with fibrates.

The endpoints we will evaluate in this study includes fasting and post postprandial measurements of triglycerides and serum apoC-III levels. We expect to complete and report the data from this study early next year. In Phase II we will also attempt to address some critically important questions about apoC-III and triglycerides. For example we will evaluate the effect of reducing apoC-III and triglycerides on insulin sensitivity in patients with type II diabetes.

Based on our mechanism of apoC-III and effect on triglycerides apoC-III reduction could improve insulin sensitivity and thus we believe that drug could bring therapeutic benefit to a very large patient population of type II diabetics. With these data in hand we plan to rapidly move to a Phase III study that will evaluate the effects of apoC-III, ISIS-APOCIIIRx in patients with triglycerides of a 1000 mg/dL or greater.

This is the initial patient population we are targeting for registration and commercialization. We believe the small size of the patient population and a desperate need for these patients to reduce their triglycerides provide us with rapid development path to reach these patients. In addition to conducting a Phase III study in patients with triglycerides greater than a 1000 mg/dL we plan to augment our exposure database and experience with Isis apoC-IIIRx by also studying the drug in patients with triglycerides greater than 500 mg/dL and those with triglycerides greater than 200 mg/dL.

In 2013 we plan to start these studies in 2013 and we will provide more information on our Phase III program as we discussed the details with regulatory authority later this year. We believe that there is clear path to the market for these very severe patients with triglyceride levels greater than 1000 mg/dl. and triglyceride lowering has been an acceptable end point for patients with severely high triglycerides who are at significant health risk and who remain underserved by currently available treatments.

Just like we are doing with KYNAMRO, as we increase our safety experience in larger numbers of patients we plan to expand indications for ISIS-APOCIIIRx to include less severe patient populations. So in summary, we think that our drug could offer significant therapeutic benefits beyond those currently available patients with hypertriglyceridemia.

The added benefit of reducing both apoC-III and triglycerides could significantly lower the risk of cardiovascular disease in these patients as well as the immediate risk of pancreatitis. The unique mechanism of action enables us to develop a selected and safe drug and avoid the side effects that are associated with currently available medicines. We believe we have a clear path to a rapid commercial opportunity not just in the United States, but also Europe and the Pacific [Rim].

And with that I would like to turn the call over to Stan to close.

Dr. Stanley Crooke

Thanks Richard. Our strategy has been to create a suite of drugs that target each of the estrogenic lipid components of cardiovascular disease. This franchise is led by KYNAMRO which is a powerful drug with a unique profile.

KYNAMRO in addition to its reductions of LDL-C and apo-B reduces all apo-B containing atherogenic lipids. However there remains a significant need to have a (inaudible) safe drugs that can specifically target other estrogenic lipids that contribute significantly to cardiovascular diseases. Triglycerides and apoC-III are two such risk factors.

Isis apoC-III is the second member of this franchise and it targets apoC-III and triglycerides. Our apoC-III drug has the opportunity to significantly improve therapy for patients with severely elevated triglycerides and our development plan is designed to ensure that we reach these patients not in 10 years but within the next five years. We believe this type of stage development plan is prudent and efficient.

In addition KYNAMRO and apoC-III we are developing licensing Isis APORx. This is a new entrant to the pipeline designed to be reduce another independent risk factor for cardiovascular disease LPL-a. And we have multiple other programs creating drugs to treat other components of Dyslipidemia following behind these drugs that are in development. Our goal in our cardiovascular franchise is to provide the specialist physician who treats this high risk patients with an arsenal of drugs so that they can offer targeted therapy for the particular combination of disorders that affect each patients.

We believe we are well along the way for doing just that. In summary, the value of Isis is much more than the commercial potential of KYNAMRO. The other drugs in our pipeline are maturing and working. There have been many that could be part of the next wave of product launches after KYNAMRO. They are many that could be part of the next wave of the product launches after KYNAMRO.

Even in the shorter term there are numerous drugs that could complete Phase II in the next two years making them potentially very attractive licensing candidates. With KYNAMRO as the foundation of broad and deep pipelines should provide many opportunities for continued revenue growth in the future.

With that I am going to then open the call out for questions. So Derrick, if you can set us up for questions I appreciate it.

Question-and-Answer Session

Operator

(Operator Instructions). And our first question is coming from the line of and Chad Messer from Needham company. Please proceed.

Chad Messer - Needham Company

Just to start I want to make sure I am clear about the Phase II and Phase III trial designs. I heard in the remarks that the Phase II will have both monotherapy and patients that are also taking fibrates. If the base line inclusion creates criteria greater than 500, is that off therapy triglycerides for those patients, are those patients at and over 500 on background therapy?

Dr. Stanley Crooke

And so it is a great question and the base line has to be above 500. Then they come into a strict diet control and then go on to treatment. So we want to make sure that they are stabilized in their diet which is one of the reasons you get a lot of noise in these kinds of trials. So there is a diet and front end to this Phase II trial and there also will be in the Phase III as they reduce a lot of variability in the triglyceride levels. However they have to come in at baseline with greater than 500 and many of these patients because of their LDL deficiency or even above 1000 mg/dl in this Phase II study?

Chad Messer - Needham Company

But you know also for the drugs?

Dr. Stanley Crooke

And so for drugs they're allowed to be on statins and so some of the patients and many of these patients will be on statins, but they are not allowed to be on other drugs expect in the cohort that has the fibrate combination and then they have to be on drugs and greater than 500.

Chad Messer - Needham Company

Okay so this I apologize for taking me a minute to understand that, the baseline of 500 or higher is patients that are not on triglycerides targeting therapies yet, statins yes, diet yes, fibrates, Niacin.

Walter Singleton

In the first course, where we’re evaluating locomotion to single agent. These patients will be above 500 on diet, possibly spans, but no triglyceride specific drugs. In the fibrate core they will be on fibrate and above 500.

Chad Messer - Needham Company

And then, maybe this is question for Dr. Witztum, and he made some comments in your remarks about in addition to potentially being a great therapy preparation, we are going to learn a lot about apoC-III from some of these studies.

And my question comes on sort of on the safety side and I understand we saw some good signals from the Phase I, but these are in a healthy volunteer. So my question is, what are the safety concerns hypothetic or otherwise and obviously the liver given the action is one place or I am kind of worried? And then my other question is, is there such a thing as too lower triglycerides in patients; is that known to be a promise they are cut off, you wouldn’t want to be below?

Joseph Witztum

Well, I think that I was trying to say in my initial remarks, that one of the things I like about the Isis approach to therapy is that they very carefully design the ASO drug, the antisense drug, so it very, very specifically inhibits just about the protein that they are aiming at.

So in this case, its going to inhibit as you said the liver production of apoC-III and from everything we know experimentally as well as from the genetic families that have been found, that Richard outlined, there really is no problem in expecting decreased levels of apoC-III per se, because that will probably be associated with very lower triglycerides.

And assuming that and I don't think there is any evidence that having too low triglycerides has any medical problems. And in the same way too low cholesterol doesn't cause any problems either. So unless there are some side effects from the compound itself, I don't think that that will be an issue.

In general, one of the nice things about the Isis platform is that, because they are producing the compounds that are very similar to each other with the exception of different sequences that are targeted to different RNA sites, they really, the side effect profile is very restricted and common to all of these compounds and there is very little off target effects.

I don't think there is any harm in lowering triglycerides as low as you could, I think as I mentioned a minute ago that the lower the triglyceride the better and I think the lower the cholesterol the better.

Dr. Stanley Crooke

Just to answer that, one way to think about this is to compare it to reducing apoB. When we began to reduce, the programs to reduce apoB there was a very appropriate concern about potential liver toxicity with that target because of the genetic abnormalities that have been observed and some of the issues that some of the mutants had. We spent a great deal of time and energy demonstrating that that concern was not going to be realized in a significant way.

And I think the data on apoB and Mipomersen demonstrated very clearly today. With apoC treatment, the situation is really quite different. The evidence from the mutated human beings is that they have no significant cardiovascular disease and they live a long time and there is zero evidence that apoC absence causes liver problems of any sore. So in many ways apoC-III is an even more attractive target initially than was apoB.

Operator

The next question is from Ted Tenthoff from Piper Jaffray. Please proceed.

Ted Tenthoff - Piper Jaffray

You discussed the partnering potential and made some comparisons to the deal, the Mipo deal, a great deal that you did with Genzyme. Can you give us a little bit more color on what you would be looking for in a partner, would you hope to have similar downstream retention as you got with KYNAMRO? And then I have a follow-on question if I may.

Dr. Stanley Crooke

Well, remember our situation has changed quite a bit into the positive. So we are much more demanding in the partnerships that we are considering today even than we were with Mipomersen. and APOCIIIRx is a drug that we think we can develop very rapidly for an initial indication.

So we’re really not entertaining licensing conversations today about apoC-III; we have great deal interest and we are keeping our potential partners suffice to what we are doing. But our objective with apoC-III is to retain a longer perhaps than we did with Mipomersen. And our focus will be of course to get a very high quality partnership done that is done at a moment when we think the value has reflected to a very high level and we’re not very concerned about the risk of apoC-III, so that could be later.

And our goal with all of our partnering now is to without trading too much of the upfront, to retain every more of the back-end and to be a much bigger participant in the commercial opportunities and so deals like the Mipomersen opportunity where we have 30% to 50% (inaudible) that are source of transactions that we’re most interested in these days for most of our drugs.

Again, its drug-by-drug defined and we look each drug and optimize our development and partnering strategy relative to the commercial opportunity to cost and size of development in the risk that are associated with it; Lynne do you want to add anything?

Lynne Parshall

Don’t have anything else there, thanks.

Dr. Stanley Crooke

Well, I really encourage people to do is not to try to make one size fits all. We have specific plans for each of the drugs in our development pipeline with what we believe are the optimal approaches to partnering and the time for partnering.

Ted Tenthoff - Piper Jaffray

And then a follow-up question if I may on KYNAMRO. I think Gerry on the drug [luminipide] got a standard review, do you think that has any read through to Sanofi's request for accelerated review on KYNAMRO?

Lynne Parshall

We have heard from the FDA that we will also get standard review.

Operator

Your next question is coming from the line of Stephen Willey from Stifel Nicolaus.

Stephen Willey - Stifel Nicolaus

Just like quickly on Phase II strategy with respect to combining with fibrates, am I mistaken or do fibrates actually work through the reduction of apoC-III and then I thought that you also maybe mentioned in regard to describing the types of patients that would in the twos, you talked about those patients that may have defects in the LPL gene and if I am not mistaken I believe that rates also work through LPL. So I am just kind of wondering I guess why the fibrate accommodation and I guess the patient population that may appear to be non responsive to fibrates?

Richard Geary

I think the answer to that is you are absolutely right. Fibrates do work through apoC-III. They have a small effect on apoC-III lowering and that is probably the way they work in lowering triglycerides. We believe that the apoC-IIIRx because it directly targets apoC-III will give us a much more robust effect on apoC-III itself, but also apoC-III probably plays additional roles and because we are directly targeting that, the recent understanding on VLDL secretion as well as clearance of the VLDL particles that have and LDL particles that have apoC-III remaining on them will have other beneficial effects. So we believe that a targeted apoC-III drug like and a potent apoC-III lowering drug like our apoC-IIIX will give additive and even synergistic potentially possibly to the fibrates and that’s what we are testing clearly on in this Phase II trial.

Dr. Stanley Crooke

No I think that's right. You know the other thing is that the data that suggest that the fibrates work by inhibiting apoC-III is pretty prominent in mice, but it's not so clear that that really is true in humans and you know as you mentioned, it has always been said at least chronically that it enhances LPL activity, so but obviously it's not terribly effective in a lot of patients and so I think the rational that Richard mentioned would something I would agree with.

Richard Geary

To answer the part of your question in this initial Phase II trials. We have LPL heterozygous, so all of the patients will have some LPL activity and we are not allowing homozygous in that particular study. We do intend to look at homozygous as well as an exploratory effort because we do think that we have seen evidence in animals that suggest and demand that suggest even in that patient population this drug might work.

Finally, really there are two choices for systemic drugs that we can study niacin, or fibrates. All of our data suggests that our drug will work extremely well in combination with both. We just picked fibrates as the first one that we look at as the simplest one in the particular centers that we are working in. Remember that Niacin isn’t used so frequently outside the US. But we actually have a great deal of confidence that the drug will be at least additive with both of those and as niacin drugs have no drug interactions to worry about.

Stephen Willey - Stifel Nicolaus

And forgive me if I missed it but did you mention the doses that should be looking at in the Phase 2?

Dr. Stanley Crooke

Standard, standard ISIS doses will look, Richard you might answer that.

Richard Geary

Sure, its 100, 200 and 300. So three doses.

Dr. Stanley Crooke

Based on the Phase 1 study as I mentioned in R&D Day in January, we are seeing with the improved screening that we are doing with significantly greater potency in this (inaudible) generation-two Niacin drugs that we saw even with Mipomersen and at 300 milligram based on the Phase 1 experienced we had dosing for three months. We expect to take the ApoC-III down as much as the 400 milligram did in the short Phase 1 study. So we decided we didn't need to look at 400 given the potency that we had observed in Phase 1.

Operator

The next question is coming from the line of Carol Werther from Summer Street.

Carol Werther - Summer Street

I was wondering what the dosing, how often the patients will be dosed in Phase 2 and …

Dr. Stanley Crooke

Once a week, Carol. Just like every other drug.

Carol Werther - Summer Street

Okay. And then I was just wondering what’s different about this drug that you have in less injection fight reactions, is it less volume, is it a different back bone?

Dr. Stanley Crooke

No, no the chemistry has not changed at all. What I talked about in the couple of forums is that of course we continue to advance the methods that we used to identify the drug that we take in the clinic and the old adage with small molecules the more you seem to your drug applies to Niacin as well. And so in the last few years since Mipomersen we steadily improved our screening processes and created new methodologies that allow us screen out certain characteristics and screening certain characteristic.

And so with this crop of the very same type of molecule as Mipomersen, we’re just seeing a bit of an increase in potency and little less of this side effect. The other thing is that with the advantage of Mipomersen, we’ve also learned how to deal with injection (inaudible) and with care physicians and patients for them. And so it’s a combination of all those things that are making these drugs performed better. I think the bottom line is we’re learning from our experience and doing a better job everyday.

Carol Werther - Summer Street

And then are you anticipating that the size of the package you will file is similar to Mipomersen?

Lynne Parshall

We’re actually planning a package, and of course, you know as Richard mentioned our plan is to have discussions with US and EU regulators later this year. So I don’t want to get too far out in front of that, but we’re actually planning a package, because the patient population for this drug even our initial population is weaker than the initial patient population certainly in this US. For KYNAMRO, we’re planning a larger patient exposure data base for this drug for our initial filing.

Dr. Stanley Crooke

It’s still not a large; it doesn’t require giant patient populations; our safety data base will be in the 1000 and something.

Lynne Parshall

This is an orphan indication, we will plan as appropriate; orphan in size filing package, but it will be some what larger package than our initial filing package for KYNAMRO.

Stanley Crooke

And that’s of course why we were doing Phase III work for a number of reason, but one of the -- first reason for doing our Phase III work including patients with less than 500 and less than a 1000 is that it opens up a much more sizeable patient group from which we can drive a safety data base as larger and that can be achieved at a time that we needed filing for the first indication.

One final thing is, we also think there is quite a significant opportunity in India where there is a very large population that apoC-III triglycerides

problem and so we’re also thinking about this drug from a geographic perspective with regard to development as well and not simply focus on the US and Europe.

Carol Werther - Summer Street

So I am assuming then you’ll have to do some studies that go out a year because there will be chronic treatment?

Dr. Stanley Crooke

We’ll do essentially what we’ve done with Mipomersen, which means that as we gain experience with extended dosing duration and then our Phase III programs most them will undoubtedly fit into an open label extension where we get long term exposure and experience.

Carol Werther - Summer Street

And so my next question is, your system syringe or a pen system or where are you on that side with your drugs?

Dr. Stanley Crooke

We are working on them and we can do so with KYNAMRO of course it’s initially a syringe, but we are working on, we are looking at all sorts of opportunities to enhance the presentation of KYNAMRO and we will use what we learn there to enable the first commercial launch of this drug to be made with an optimal presentation.

Operator

At this time, I am showing no further questions in queue, I would like to turn the call back over to Dr. Stanley Crooke for any closing remarks.

Stanley Crooke

Well, thank you very much for your participation and your questions. I think bottom-line, we think apoC-III is a very exciting new-term commercial opportunity, one that we can develop ourselves or partner at the optimal time. And it is one of many drugs that we think are exciting in our pipeline and certainly a group of five drugs that we think we can get to the market in the timeframe, where Mipomersen is continuing to grow in sales, because of new indications. We think that’s really at extraordinary position for a biotechnology company we would be in and we are excited about what the future holds for us. Thank you.

Operator

Ladies and gentlemen that concludes today’s conference. We thank you for your participation. You may now disconnect. Have a great day.

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