10-QPeriod: Q2 FY2016

ALNYLAM PHARMACEUTICALS, INC. Quarterly Report for Q2 Ended Jun 30, 2016

Filed August 4, 2016For Securities:ALNY

Summary

Alnylam Pharmaceuticals, Inc. reported its financial results for the quarter and six months ended June 30, 2016. The company continues to experience significant operating losses, with a net loss of $90.1 million for the quarter and $193.1 million for the six months. This is largely driven by substantial investments in research and development, which increased by 24% and 44% respectively for the periods compared to the prior year, reflecting advancements in their RNAi therapeutic pipeline, particularly in Genetic Medicines. Despite the ongoing losses, Alnylam's cash position remains strong, with cash and cash equivalents totaling $271.1 million at quarter-end, bolstered by recent financing activities including a $150 million term loan facility. Key collaborations with Sanofi Genzyme and The Medicines Company continue to generate revenue, though overall collaboration revenues saw a decrease in the six-month period due to the completion of certain agreements. The company is advancing its 'Alnylam 2020' plan, aiming for three marketed products and ten clinical programs by the end of 2020. Progress in key therapeutic areas, including positive data from patisiran and fitusiran studies, highlights the ongoing development efforts. The company also announced an amendment to its lease for a manufacturing facility, extending the term through August 2022.

Financial Highlights

38 data points
Beta

Net Income

-$90.13M

EPS (Diluted)

$-1.05

Total Assets

$1.38B

Cash & Equivalents

$271.08M

Free Cash Flow

-$91.83M

Financial Statements
Beta
R&D Expenses$83.17M
Operating Expenses$101.16M
Operating Income-$92.45M
Net Income-$90.13M
EPS (Basic)$-1.05
Shares Outstanding (Basic)85.55M

Key Highlights

  • 1Net loss for the three months ended June 30, 2016 was $90.1 million, compared to $71.8 million in the same period of 2015. For the six months ended June 30, 2016, net loss was $193.1 million, compared to $122.6 million in 2015.
  • 2Research and development expenses increased significantly, up 24% to $83.2 million for the quarter and 44% to $179.4 million for the six months, reflecting pipeline advancement and increased headcount.
  • 3Collaboration revenues for the quarter remained stable at $8.7 million, but decreased to $16.1 million for the six months, down from $27.2 million in the prior year, primarily due to the completion of performance obligations under certain agreements.
  • 4The company ended the quarter with a strong liquidity position, reporting $271.1 million in cash and cash equivalents, and $1.13 billion in cash, cash equivalents, and marketable securities (excluding restricted investments and Regulus equity).
  • 5Alnylam secured a $150 million term loan facility in April 2016 to support the build-out of its new drug substance manufacturing facility.
  • 6Positive clinical updates were reported for patisiran (ATTR amyloidosis) and fitusiran (hemophilia), with plans to initiate Phase 3 trials for fitusiran in early 2017.
  • 7The company amended its lease for a manufacturing facility, extending the term by five years through August 2022.

Frequently Asked Questions

Alnylam reported a net loss of $90.1 million for the three months ended June 30, 2016, and $193.1 million for the six months ended June 30, 2016. The company continues to incur significant operating losses due to substantial investments in research and development, which increased substantially year-over-year. These investments are focused on advancing its pipeline of RNAi therapeutics. Collaboration revenues are a key source of income, though they decreased in the six-month period due to the completion of certain agreements.

Alnylam maintains a strong cash position, with $271.1 million in cash and cash equivalents as of June 30, 2016. In addition to existing cash reserves, the company secured a $150 million term loan facility in April 2016, primarily for the construction of a new manufacturing facility. Ongoing revenue from collaborations also contributes to funding. The company's strategy relies on existing and future alliances for funding.

Alnylam reported positive clinical updates for several programs. For patisiran (ATTR amyloidosis), initial 24-month data showed potential to halt or improve neuropathy progression. Fitusiran (hemophilia) demonstrated positive interim Phase 1 results with a zero median annualized bleeding rate in some patients. The company also initiated a Phase 1/2 trial for ALN-HBV (hepatitis B) and advanced ALN-CC5 for complement-mediated diseases. Phase 3 trials for fitusiran are now expected to begin in early 2017.

The company expects future revenues to be primarily derived from its alliances with Sanofi Genzyme, The Medicines Company, and other strategic partnerships. While collaboration revenues decreased in the first half of 2016, Alnylam anticipates an increase in the second half due to expected expense reimbursements from Sanofi Genzyme. The company is also progressing towards its 'Alnylam 2020' goal, which includes having three marketed products by 2020.