Shares of Ionis Pharmaceuticals (IONS) are slipping after Goldman Sachs analyst Salveen Richter downgraded the stock to Sell, saying the company’s antisense platform has yet to be fully optimized given the low rate of clinical success and ongoing toxicity across multiple drugs.

GOLDMAN SAYS SELL: In a research note this morning, Goldman Sachs’ Richter downgraded Ionis to Sell from Neutral and lowered his price target on the shares to $25 from $28. The analyst told investors that while the company is an early pioneer of antisense RNA therapies and the technology has the potential to address “undruggable” targets in broad therapeutic areas, a “lackluster” track record of developing successful drugs along with platform toxicity makes it a “show me” story. Further, Richter noted he questions the commercial viability of volanesorsen. If the drug is approved for Familial Chylomicronemia Syndrome, safety/compliance issues and the specialist launch focus will translate to limited returns, paralleling prior drug Kynamro for high cholesterol, he argued. In terms of Phase 3 TTR-Rx results in FAP, or nerve damage due to amyloid accumulation, that are due in the second quarter, the analyst pointed out that he has limited visibility on the quality of life co-primary endpoint. Serious platelet declines and competition from Alnylam Pharmaceuticals’ (ALNY) neck-in-neck Phase 3 patisiran will be the focus, he added. On the other hand, Richter highlighted that Ionis’ next-generation Ligand-Conjugated Antisense, or LICA, drugs with greater potency may mitigate toxicity, but unpredictable toxicity may be introduced when a new chemistry is developed.

‘SOLID EFFICACY’: Conversely, Piper Jaffray analyst Joshua Schimmer remains bullish on Ionis. Earlier this week, in a research note following Ionis’ Phase 3 volanesorsen data report, Schimmer said the data showed “solid efficacy” in the 66-patient study for Familial Chylomicronemia Syndrome. The safety profile of the drug has “been a source of consternation,” but Schimmer pointed out he does not believe it is as problematic as many investors believe given the patient population. Moreover, the analyst noted that the LICA version should have a much cleaner profile. He models peak volanosorsen sales of about $200M in 2021 before being cannibalized by the LICA version partnered with Novartis (NVS). Schimmer reiterated an Overweight rating and $66 price target on Ionis’ shares.