ISIS Pharmaceuticals (ISIS) Stock Rallying on Positive Data for Infants With Rare Spinal Disease

NEW YORK (TheStreet) -- Shares of ISIS Pharmaceuticals (ISIS) are climbing today by 2.58% to $68.24 after the company reported encouraging results from its Phase 2 study of treatment ISIS-SMN Rx in infants with spinal muscular atrophy.

After giving doses to 20 infants, results showed that most lived longer without permanent ventilation and the treatment increased their ability to use their muscles, according to the company.

Specifically, the median age without permanent ventilation or death increased to 19.9 months from 16.3 months for four infants on one level of dosage, and to 16.7 months from 11.6 months on a higher dosage.

The drug is currently being developed with Biogen (BIIB) and could target a $1 billion market, said RBC Capital Markets analyst Michael Yee, according to Bloomberg. 

Generally, babies with spinal muscular atrophy die within the first two years of life, but mechanical respiration can prolong their lifespan, according to the National Institute of Health.

Separately, TheStreet Ratings team rates ISIS PHARMACEUTICALS INC as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:

"We rate ISIS PHARMACEUTICALS INC (ISIS) a HOLD. The primary factors that have impacted our rating are mixed, some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and generally higher debt management risk."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • ISIS's very impressive revenue growth greatly exceeded the industry average of 21.6%. Since the same quarter one year prior, revenues leaped by 122.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 48.14% and other important driving factors, this stock has surged by 134.43% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • The debt-to-equity ratio of 1.42 is relatively high when compared with the industry average, suggesting a need for better debt level management. Despite the company's weak debt-to-equity ratio, the company has managed to keep a very strong quick ratio of 8.13, which shows the ability to cover short-term cash needs.
  • Net operating cash flow has decreased to -$42.83 million or 32.47% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • You can view the full analysis from the report here: ISIS Ratings Report

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