Akcea Therapeutics has already been struggling to turn its two products into commercial winners. Now it will have to do so during a massive management transition.
Akcea (NASDAQ: AKCA) said Monday that CEO Paula Soteropoulos, president Sarah Boyce and chief operating officer Jeff Goldberg have left the company. Akcea’s board of directors has appointed Damien McDevitt interim CEO. McDevitt is already an Akcea director and is the chief business officer of Ionis Pharmaceuticals (NASDAQ: IONS), which spun out Akcea in 2015 and still owns most of the company’s shares. His experience also includes various business development roles at GlaxoSmithKline (NYSE: GSK).
In a Monday regulatory filing, the company said Soteropoulos, Boyce, and Goldberg entered separation agreements last Wednesday and that Soteropoulos and Boyce have also given up their board seats. Michael Yang and Joseph “Skip” Klein III will take their place. The separation agreements of Soteropoulos and Goldberg call for both to provide consulting services to Akcea through the end of October.
Boston-based Akcea gave no reason for the management moves. But its press release did indicate a strategic shift is underway. Ionis is “renewing and deepening its commitment” to Akcea, which plans to license more drugs from Ionis and potentially add other experimental medicines through deals. The “surprising” changes “raise significant questions” about the company and its commercial strategy, wrote Stifel analyst Paul Matteis.
“It’s hard to interpret this any other way than Ionis and the Akcea board were unhappy with leadership and/or want to in some fashion change focus,” Matteis wrote. It “sends a loud message when three core executives unexpectedly depart.”
Akcea shares fell 21 percent, to $17.82 apiece, in early trading Monday.
Akcea went public in 2017 supported by a group of experimental rare disease drugs discovered by Carlsbad, CA-based Ionis. The company has steered two of those drugs to the market, and both are in the early stages of their respective launches. Though the FDA rejected volanesorsen (Waylivra), a treatment for familial chylomicronemia syndrome—an ultra-rare disease that causes a buildup of fat in a patient’s organs—European regulators approved it, and Akcea is just starting to sell the drug overseas. The FDA in 2018 approved inotersen (Tegsedi), an injectable drug that treats peripheral nerve damage experienced by patients who have the rare disease hereditary transthyretin amyloidosis (hATTR). Akcea has yet to report revenue from Waylivra. And Tegsedi is battling for market share with two other recently approved transthyretin amyloidosis treatments from Alnylam Pharmaceuticals (NASDAQ: ALNY) and Pfizer (NYSE: PFE).
Tegsedi generated $10 million in its most recent quarter, and Matteis expects sales should jump next quarter by 34 percent, to $13.3 million. But “it’s hard to see this abrupt transition as not being disruptive” to Tegsedi’s launch, Matteis wrote. The best-case scenario for Tegsedi is likely a “meaningful minority share” relative to the Alnylam and Pfizer drugs, Matteis wrote. Akcea’s upside may lie in its drug pipeline, including assets that are being developed in partnership with Novartis (NYSE: NVS), he added.
In February, Novartis paid Ionis and Akcea $150 million for rights to an experimental treatment for a drug meant to lower levels of lipoprotein(a) in heart disease patients.
Photo by Akcea