UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-Q
(Mark One)
ý QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 2004
OR
o TRANSITION REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 0-19125
Isis Pharmaceuticals, Inc.
(Exact name of Registrant as specified in its charter)
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Delaware |
33-0336973 |
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(State or other jurisdiction of |
(IRS Employer Identification No.) |
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2292 Faraday Ave., Carlsbad, CA 92008 |
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(Address of principal executive offices, including zip code) |
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760-931-9200 |
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(Registrant’s telephone number, including area code) |
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Securities registered pursuant to Section 12(b) of the Act: None |
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Securities registered pursuant to Section 12(g) of the Act: |
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Common Stock, $.001 Par Value |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12(b)-2 of the Securities Exchange Act of 1934). Yes ý No o
The number of shares of voting common stock outstanding as of November 3, 2004 was 57,277,367.
ISIS PHARMACEUTICALS, INC.
FORM 10-Q
INDEX
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PART I |
FINANCIAL INFORMATION |
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ITEM 1: |
Financial Statements: |
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Condensed
Consolidated Balance Sheets as of |
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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2
ISIS PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
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September 30, |
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December 31, |
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(Unaudited) |
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(Note) |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ |
21,446 |
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$ |
33,117 |
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Short-term investments |
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104,119 |
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182,387 |
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Contracts receivable |
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5,464 |
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2,657 |
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Inventory |
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20,090 |
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13,995 |
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Other current assets |
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8,236 |
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7,405 |
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Total current assets |
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159,355 |
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239,561 |
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Property, plant and equipment, net |
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30,857 |
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34,790 |
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Licenses, net |
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26,619 |
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28,363 |
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Patents, net |
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25,981 |
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22,374 |
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Deposits and other assets |
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8,052 |
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8,479 |
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Long-term investments |
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4,407 |
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1,375 |
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Total assets |
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$ |
255,271 |
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$ |
334,942 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current liabilities: |
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Accounts payable |
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$ |
2,818 |
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$ |
3,720 |
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Accrued compensation |
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3,819 |
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4,149 |
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Accrued liabilities |
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10,430 |
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6,527 |
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Current portion of long-term obligations |
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10,029 |
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16,477 |
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Current portion of deferred contract revenue |
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15,801 |
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14,684 |
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Total current liabilities |
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42,897 |
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45,557 |
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5 ½% convertible subordinated notes |
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125,000 |
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125,000 |
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Long-term obligations, less current portion |
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104,369 |
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88,397 |
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Long-term deferred contract revenue, less current portion |
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644 |
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8,810 |
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Stockholders’ equity (deficit): |
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Series B Convertible Exchangeable 5% Preferred stock, $0.001 par value; 4,605 shares authorized, no shares issued or outstanding at September 30, 2004; 16,620 shares authorized, 12,015 shares issued and outstanding at December 31, 2003 |
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12,015 |
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Accretion of Series B Preferred stock dividends |
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2,560 |
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Common stock, $0.001 par value; 100,000,000 shares authorized, 57,277,367 shares and 55,557,253 shares issued and outstanding at September 30, 2004 and December 31, 2003, respectively |
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57 |
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56 |
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Additional paid-in capital |
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622,395 |
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604,948 |
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Deferred compensation |
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(140 |
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(294 |
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Accumulated other comprehensive income |
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956 |
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3,476 |
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Accumulated deficit |
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(640,907 |
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(555,583 |
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Total stockholders’ equity (deficit) |
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(17,639 |
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67,178 |
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Total liabilities and stockholders’ equity (deficit) |
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$ |
255,271 |
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$ |
334,942 |
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Note: The balance sheet at December 31, 2003 has been derived from the audited consolidated financial statements at that date.
See accompanying notes
3
ISIS PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except for per share amounts)
(Unaudited)
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Three Months Ended |
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Nine Months Ended |
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2004 |
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2003 |
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2004 |
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2003 |
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Revenue: |
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Research and development revenue under collaborative agreements |
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$ |
9,055 |
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$ |
11,263 |
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$ |
24,270 |
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$ |
39,944 |
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Licensing and royalty revenue |
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38 |
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31 |
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