Alnylam Pharmaceuticals, Inc
. (Nasdaq: ALNY), a leading RNAi therapeutics company, today reported its consolidated financial results for the second quarter 2013, and company highlights.
“This was an exceptional, data-rich quarter and recent period for Alnylam, where we reported positive clinical results from multiple ‘Alnylam 5x15’ programs. First, we presented positive interim data from our Phase II multi-dose trial of ALN-TTR02, where we showed up to 93% knockdown of circulating wild-type and mutant TTR in ATTR patients. In the coming weeks we plan to have patients treated in this Phase II study roll over into an open-label extension study, which will include a number of clinical endpoint measurements with initial data expected to be presented in 2014. We also remain on track to start a Phase III pivotal trial for ALN-TTR02 by the end of 2013,” said John Maraganore, Ph.D., Chief Executive Officer of Alnylam. “In addition, we were excited to report positive top-line results from our Phase I clinical study of ALN-TTRsc, a subcutaneously administered RNAi therapeutic targeting TTR for the treatment of ATTR. Specifically, we reported that ALN-TTRsc achieved greater than 80% knockdown of serum TTR and was generally safe and well tolerated. Importantly, we believe these clinical results establish human translation for RNAi therapeutics using our GalNAc-siRNA conjugate delivery platform, with implications for the entirety of our ‘Alnylam 5x15’ pre-clinical pipeline, which employs what is now a clinically validated subcutaneous delivery approach. With these recent advances, we believe that we are building a compelling opportunity for shareholder value creation with a modular and reproducible approach for development and, ultimately, commercialization of innovative medicines for genetically defined diseases.”
“In addition to the positive clinical data we reported recently, we were also pleased to report promising pre-clinical data, including key proof-of-concept data, from multiple ‘Alnylam 5x15’ programs. In our ALN-AT3 hemophilia program, we presented a robust set of data at the ISTH meeting
including results in multiple models of hemophilia
that highlight the potential and the innovative nature of this program. Notably, we demonstrated that subcutaneous administration of ALN-AT3 can fully normalize thrombin generation in a non-human primate hemophilia ‘inhibitor’ model, an important finding as thrombin generation is closely correlated with degree of disease severity in hemophilia patients. Certain IND-enabling pre-clinical and CMC work is being completed for this program resulting in a one quarter shift in timelines, and we now expect to file an IND for ALN-AT3 in the fourth quarter of 2013 and to initiate our Phase I clinical trial in early 2014,” said Barry Greene, President and Chief Operating Officer of Alnylam. “In addition, we presented key proof-of-concept data with ALN-AS1, an RNAi therapeutic targeting ALAS-1 for the treatment of porphyria, and introduced ALN-CC5, an RNAi therapeutic targeting complement component C5 for the treatment of complement-mediated diseases. Both of these programs use our GalNAc-siRNA conjugate approach enabling subcutaneous dosing with a wide therapeutic index, and we expect to nominate development candidates for both programs by year’s end. At our recent R&D Day, we also reported new pre-clinical data in our PCSK9 program
which is partnered with The Medicines Company
using our GalNAc-siRNA conjugate platform, showing potent and robust PCSK9 knockdown and LDL-c lowering with subcutaneous dosing. All told, we are very pleased with the progress we are making in executing on our ‘Alnylam 5x15’ product strategy, with the goal of bringing innovative medicines to patients.”
Cash, Cash Equivalents and Total Marketable Securities
At June 30, 2013, Alnylam had cash, cash equivalents and total marketable securities of $379.5 million, as compared to $226.2 million at December 31, 2012.
The net loss according to accounting principles generally accepted in the U.S. (GAAP) for the second quarter of 2013 was $18.2 million, or $0.29 per share on both a basic and diluted basis (including $3.4 million, or $0.05 per share of non-cash stock-based compensation expense), as compared to a net loss of $13.0 million, or $0.25 per share on both a basic and diluted basis (including $3.1 million, or $0.06 per share of non-cash stock-based compensation expense), for the same period in the previous year.
Revenues were $8.7 million for the second quarter of 2013, as compared to $20.9 million for the same period last year. Revenues for the second quarter of 2013 included $5.5 million of revenues from the company’s alliance with Takeda Pharmaceuticals Company Limited, $1.4 million of revenues related to the company’s collaboration with Monsanto, and $1.8 million for the company’s alliance with The Medicines Company, research reagent licenses, and other sources. For the remainder of 2013, the company expects net revenues from research collaborations to remain consistent with the amount recorded in the second quarter.
Research and Development Expenses
Research and development (R&D) expenses were $24.2 million in the second quarter of 2013, which included $2.2 million of non-cash stock-based compensation, as compared to $21.7 million in the second quarter of 2012, which included $2.0 million of non-cash stock-based compensation. The increase in R&D expenses in the second quarter of 2013 as compared to the prior year period was due primarily to higher clinical trial and manufacturing expenses related to the company’s ALN-TTR02 and ALN-TTRsc programs. In addition, external services expenses increased, due primarily to higher pre-clinical expenses for the company’s ALN-TTR and ALN-AT3 programs, which were advanced further in development. Partially offsetting these increases were license fees due to certain entities related to our delivery and platform technologies that were expensed in 2012. Alnylam expects that R&D expenses will increase moderately for the second half of 2013.
General and Administrative Expenses
General and administrative (G&A) expenses were $5.8 million in the second quarter of 2013, which included $1.2 million of non-cash stock-based compensation, as compared to $11.2 million in the second quarter of 2012, which included $1.1 million of non-cash stock-based compensation. The decrease in G&A expenses for the second quarter of 2013 as compared to the prior year period was due primarily to a decrease in consulting and professional services related to business and legal activities. Alnylam expects that G&A expenses will remain consistent for the second half of 2013.
Investment in Regulus Therapeutics
Equity in loss of joint venture was zero for the second quarter of 2013 and $1.1 million for the second quarter of 2012. The prior year equity in loss of joint venture was related to the company’s share of the net losses incurred by Regulus. The company no longer uses the equity method to account for its investment in Regulus because it no longer has significant influence over the operating and financial policies of Regulus. The company now accounts for its investment in Regulus at fair value by adjusting the value to reflect fluctuations in Regulus’ stock price each reporting period. At June 30, 2013, the fair market value of the company’s investment in Regulus was $60.3 million as compared to $38.7 million at December 31, 2012.
Interest income was $0.3 million for the second quarter of 2013 and 2012.
Benefit from Income Taxes
The company had a benefit from income taxes of $2.9 million for the second quarter of 2013 as compared to zero in the second quarter of 2012. The income tax benefit is associated with the corresponding increase in the value of the company’s investment in Regulus that the company recorded in other comprehensive income, net of tax.
2013 Financial Guidance
The company expects that its cash, cash equivalents and total marketable securities balance will be greater than $320 million at December 31, 2013.
“Alnylam continues to maintain a solid balance sheet, ending this second quarter with $380 million in cash,” said Michael Mason, Vice President, Finance and Treasurer of Alnylam. “We remain on track to end 2013 with greater than $320 million, which will continue to provide us with a strong balance sheet to execute on our business plan and advance our RNAi therapeutics through clinical trials and toward the market.”