10-QPeriod: Q1 FY2012

ALNYLAM PHARMACEUTICALS, INC. Quarterly Report for Q1 Ended Mar 31, 2012

Filed May 3, 2012For Securities:ALNY

Summary

Alnylam Pharmaceuticals, Inc. reported its first quarter 2012 financial results, indicating continued investment in its RNAi therapeutic pipeline. The company's net revenue from research collaborators remained relatively stable year-over-year, primarily driven by its alliances with Roche/Arrowhead and Takeda. However, operating expenses, particularly in research and development, saw a decrease compared to the prior year, largely due to a strategic restructuring and workforce reduction implemented in early 2012, which is expected to yield significant cost savings throughout the year. Financially, Alnylam ended the quarter with a solid cash position, bolstered by a public offering of common stock in February 2012 that raised approximately $86.8 million in net proceeds. This capital infusion is earmarked for advancing its clinical pipeline, including the ALN-TTR02 and ALN-APC programs. Despite ongoing net losses, typical for an early-stage biopharmaceutical company, the company appears well-positioned to fund its operations through at least the end of 2013, with potential for further funding through existing or new strategic alliances.

Financial Highlights

40 data points
Beta

Net Income

-$11.37M

EPS (Diluted)

$-0.25

Total Assets

$340.30M

Cash & Equivalents

$61.74M

Free Cash Flow

-$30.48M

Financial Statements
Beta
R&D Expenses$21.07M
Operating Expenses$31.48M
Operating Income-$10.89M
Net Income-$11.37M
EPS (Basic)$-0.25
Shares Outstanding (Basic)46.21M

Key Highlights

  • 1Net revenues from research collaborators were $20.6 million, largely consistent with the prior year's $20.9 million, driven by alliances with Roche/Arrowhead and Takeda.
  • 2Total operating expenses decreased by 14% to $31.5 million from $36.6 million in the prior year period, primarily due to a 20% reduction in Research and Development expenses.
  • 3The company successfully raised approximately $86.8 million in net proceeds from a public offering of common stock in February 2012.
  • 4Restructuring efforts completed in the first quarter of 2012 resulted in a workforce reduction and $3.9 million in restructuring-related costs, with expected savings of approximately $20.0 million in 2012 operating expenses.
  • 5Alnylam's cash, cash equivalents, and marketable securities stood at $316.9 million at the end of the quarter, providing a strong liquidity position.
  • 6The company reported a net loss of $11.4 million, or $0.25 per share, compared to a net loss of $16.3 million, or $0.38 per share, in the same period last year.
  • 7A subsequent event in April 2012 involved Alnylam exercising its option to opt-out of a 50-50 expense/profit share arrangement with Medtronic for the ALN-HTT program, moving to a royalty and milestone licensing structure.

Frequently Asked Questions

For the first quarter of 2012, Alnylam reported net revenues of $20.6 million, a slight decrease from $20.9 million in the prior year. Operating expenses decreased by 14% to $31.5 million, driven by reductions in R&D spending, partly due to a strategic restructuring. The company reported a net loss of $11.4 million ($0.25 per share), an improvement from a net loss of $16.3 million ($0.38 per share) in Q1 2011. The company ended the quarter with $316.9 million in cash, cash equivalents, and marketable securities, significantly boosted by an $86.8 million net proceeds from a February 2012 stock offering.

Alnylam implemented a strategic corporate restructuring in January 2012, reducing its workforce by approximately 33%. This resulted in $3.9 million in restructuring-related costs during Q1 2012. The company expects these actions to generate savings of approximately $20.0 million in 2012 operating expenses and anticipates a decrease in R&D and G&A expenses for the remainder of the year.

The company continues to advance its RNAi therapeutic pipeline, with a focus on ALN-TTR02 and ALN-APC. They initiated a Phase I clinical trial for ALN-TTR02 in March 2012. Revenue generation remains primarily through existing alliances, notably with Roche/Arrowhead and Takeda. In a subsequent event in April 2012, Alnylam opted out of a 50-50 expense/profit share agreement with Medtronic for the ALN-HTT program, shifting to a royalty and milestone licensing structure.

Alnylam maintains a strong liquidity position with $316.9 million in cash, cash equivalents, and marketable securities as of March 31, 2012. This was significantly enhanced by an $86.8 million net capital raise from a public stock offering in February 2012, which is intended to fund pipeline advancement and general corporate purposes. The company believes its current resources are sufficient to fund its planned operations through at least the end of 2013.