Alnylam Sets Product Goals - Analyst Blog

Alnylam Pharmaceuticals (ALNY) recently announced the launch of a new product strategy called “Alnylam 5x15" and also provided guidance and goals for 2011. Alnylam plans to focus its development efforts on ALN-TTR and find a partner for its liver cancer candidate ALN-VSP.

Under its “Alnylam 5x15" strategy, the company aims to develop novel RNAi drugs, which can address genetically defined diseases with a high unmet need. Alnylam has set the goal to have five RNAi drugs in advanced stages of clinical development by 2015. The five drugs include ALN-TTR, ALN-PCS, ALN-HPN and two unspecified preclinical programs (expected to move into clinical development by the end of 2011).

Alnylam is conducting a phase I clinical study of ALN-TTR01 to treat transthyretin (TTR) mediated amyloidosis. It expects to accelerate development of the drug and complete the trial in the first half of 2011. Data from the trial is expected to be presented in the third quarter of 2011. Alnylam is also working on a second generation delivery formulation ALN-TTR02 and plans to file an investigational new drug (IND) for the candidate in the second half of 2011. Alnylam will initiate phase II trials in 2012.

While Alnylam plans to file an IND for ALN-PCS for high cholesterol in the first half of 2011, the IND filing for ALN-HPN for refractory anemia is scheduled for 2012.

As regards the drugs already under development, a phase I clinical study of ALN-VSP to treat liver cancer is ongoing and is expected to complete in the second quarter. Data presented in November 2010 at the Chemotherapy FD Symposium demonstrated strong potential of ALN-VSP as defined by its efficacy and safety. The pipeline candidate has still not shown dose-limiting toxicity, albeit an encouraging fact. The company plans to find a partner for the drug before initiating phase II studies.

Alnylam is conducting phase IIb clinical study of ALN-RSV01 in Respiratory Syncytial Virus (RSV)-infected lung transplantations and expects to report data in 2012. The company has, however, not determined any future plans for the drug. The company and partner Cubist (CBST) have temporarily suspended the development of ALN-RSV02 for children.

Alnylam plans to file an IND for another program, ALN-HTT, for the treatment of Huntington's disease in 2012. The company will develop the drug in collaboration with Medtronic Inc (MDT) and CHDI Foundation.

The company expects to end 2010 with more than $345 million in cash, cash equivalents, and marketable securities versus a prior expectation of $325 million. In addition, for 2011, management expects a cash position of $275 million.

Our Recommendation

We currently have a Neutral recommendation on the stock. We are pleased with the company's partnerships with several large pharmaceutical companies that provide it with financial muscle. The company's balance sheet is also very strong. However, with the end of two major deals (Novartis and Roche) in the second half of 2010, we prefer to remain on the sidelines as the company could lose out on major milestone payments and royalties. Accordingly, we maintain a Neutral stance on the stock.

 
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