Alnylam Pharmaceuticals Reports Second Quarter 2010 Financial Results
CAMBRIDGE, Mass., Aug 04, 2010 (BUSINESS WIRE) -- Alnylam Pharmaceuticals, Inc. (Nasdaq: ALNY), a leading RNAi therapeutics company, today reported its consolidated financial results for the second quarter ended June 30, 2010, and company highlights.
"These are exciting times for RNAi therapeutics, as the field stands at the frontier of key human proof-of-concept data across a number of programs, providing further validation of RNAi therapeutics as a whole new class of innovative medicines. With this focus in mind, Alnylam's second quarter was characterized by continued advancement of our clinical pipeline, in addition to our commitment to scientific leadership. Indeed, we made significant progress in these areas, including the presentation of preliminary data from our Phase I ALN-VSP study for liver cancer, the initiation of our Phase I ALN-TTR01 study for the treatment of transthyretin-mediated amyloidosis (ATTR), and continued enrollment of patients in our ALN-RSV01 Phase IIb study in RSV-infected adult lung transplant patients," said John Maraganore, Ph.D., Chief Executive Officer of Alnylam. "During the quarter, we also demonstrated our continued scientific leadership through the publication and presentation of our research at key meetings and in peer-reviewed journals. In fact, we have already published 19 papers this year, exceeding our goal of 15 or more papers by year's end. We look forward to reporting on our progress across these key value drivers in the second half of 2010, including updated data on our ALN-VSP study, and continuing our focus on advancing RNAi therapeutics to patients."
"We also had an exciting quarter on the business front, including the landmark alliance between Regulus and sanofi-aventis on the development of microRNA therapeutics. Regulus is the leader in the development of microRNA therapeutics, and this new partnership - the third for Regulus - recognizes the high level of interest in this emerging area across the pharmaceutical industry," said Barry Greene, President and Chief Operating Officer of Alnylam. "Our business development efforts continue related to our many partnership opportunities at Alnylam, Alnylam Biotherapeutics, and Regulus, in addition to new venture opportunities. Certainly, we believe that our industry-leading partnerships, intellectual property position, and financial stability continue to position Alnylam as the leader in the development of RNAi therapeutics, and we expect to only strengthen this position throughout the rest of the year."
Cash, Cash Equivalents and Total Marketable Securities
At June 30, 2010, Alnylam had cash, cash equivalents and total marketable securities of $396.9 million, as compared to $435.3 million at December 31, 2009.
The net loss according to accounting principles generally accepted in the U.S. (GAAP) for the second quarter of 2010 was $14.6 million, or $0.35 per share on both a basic and diluted basis (including $5.1 million, or $0.12 per share of non-cash stock-based compensation expense), as compared to a net loss of $22.7 million, or $0.55 per share on both a basic and diluted basis (including $5.4 million, or $0.13 per share of non-cash stock-based compensation expense), for the same period in the previous year. The decrease in net loss in the second quarter of 2010 as compared to the prior year period was due primarily to $11.0 million in license fees paid in the prior year period in connection with the company's single-stranded RNAi (ssRNAi) agreement with Isis Pharmaceuticals, Inc.
Revenues were $26.6 million for the second quarter of 2010, as compared to $24.6 million for the same period last year. Revenues for the second quarter of 2010 included $14.0 million of collaboration revenues related to the company's alliance with Roche, $5.5 million of revenues from the company's alliance with Takeda Pharmaceuticals Company Limited, $1.9 million of license fee revenues from Regulus Therapeutics Inc. related to the sanofi-aventis alliance, and $5.2 million of expense reimbursement and amortization revenues from Novartis, the National Institutes of Health (NIH), Cubist Pharmaceuticals, Inc., Biogen Idec Inc., InterfeRx(TM), research reagent and services licenses, and other sources.
Research and Development Expenses
Research and development (R&D) expenses were $28.1 million in the second quarter of 2010, which included $3.2 million of non-cash stock-based compensation, as compared to $38.6 million in the second quarter of 2009, which included $3.2 million of non-cash stock-based compensation. The decrease in R&D expenses in the second quarter of 2010 as compared to the prior year period was due primarily to $11.0 million in license fees paid in the prior year period in connection with the company's ssRNAi agreement with Isis, partially offset by an increase in compensation and related expenses due to additional R&D headcount to support the company's alliances and expanding product pipeline.
General and Administrative Expenses
General and administrative (G&A) expenses were $10.1 million in the second quarter of 2010, which included $1.8 million of non-cash stock-based compensation, as compared to $8.4 million in the second quarter of 2009, which included $2.2 million of non-cash stock-based compensation. The increase in G&A expenses for the second quarter of 2010 as compared to the prior year period was due primarily to higher professional service fees in association with business activities, primarily legal activities.
Equity in loss of joint venture was $3.9 million and $0.8 million for the second quarter of 2010 and 2009, respectively, related to Alnylam's approximate 49% share of the net losses incurred by Regulus. The increase in Regulus' net loss for the second quarter of 2010 was due to charges incurred for payments due to Alnylam and Isis related to the sanofi-aventis alliance established in June 2010.
Interest income was $0.6 million for the second quarter of 2010, as compared to $1.5 million for the second quarter of 2009. The decrease in interest income was due primarily to lower average interest rates as well as lower average cash, cash equivalents and total marketable securities balances as compared to the prior year.
Income tax benefit was $0.2 million for the second quarter of 2010, as compared to a provision for income taxes of $0.9 million for the second quarter of 2009. The provision for income taxes for 2009 was due primarily to taxable income in 2009 as a result of the company's alliances with Roche and Takeda.
2010 Financial Guidance
Alnylam expects that its cash, cash equivalents and total marketable securities balance will be greater than $325 million at December 31, 2010, which excludes the potential payment from Novartis should they decide to execute their adoption license.
"While we continue to fund our platform and clinical pipeline, we again achieved significant revenues this quarter, which includes the recent payment from Regulus related to the sanofi-aventis alliance," said Patricia Allen, Vice President, Finance and Treasurer of Alnylam. "We remain on track to finish 2010 with an excellent balance sheet with greater than $325 million in cash, excluding the potential adoption license payment from Novartis."
Second Quarter 2010 and Recent Significant Corporate Highlights
Product Pipeline and Scientific Leadership Highlights
To date in 2010, Alnylam and Regulus scientists have published 19 papers in peer-reviewed journals, exceeding Alnylam's goal of publishing 15 or more peer-reviewed papers in 2010.
Business Execution Highlights
Intellectual Property (IP) Highlights
To date in 2010, Alnylam has received 28 new patents and expects to exceed its goal of 30 or more patent issuances or grants in 2010.
Conference Call Information
Management will provide an update on the company, discuss second quarter 2010 results, and discuss expectations for the future via conference call on August 4, 2010 at 4:30 p.m. ET. A corporate slide presentation will also be available on the Investor page of our website, www.alnylam.com, to accompany the conference call. To access the call, please dial 866-543-6405 (domestic) or 617-213-8897 (international) five minutes prior to the start time and provide the passcode 64319348. A replay of the call will be available beginning at 7:30 p.m. ET on August 4, 2010. To access the replay, please dial 888-286-8010 (domestic) or 617-801-6888 (international), and provide the passcode 96901818.
A live audio webcast of the call will also be available on the "Investors" section of the company's website, www.alnylam.com. An archived webcast will be available on the Alnylam website approximately two hours after the event.
About RNA Interference (RNAi)
RNAi (RNA interference) is a revolution in biology, representing a breakthrough in understanding how genes are turned on and off in cells, and a completely new approach to drug discovery and development. Its discovery has been heralded as "a major scientific breakthrough that happens once every decade or so," and represents one of the most promising and rapidly advancing frontiers in biology and drug discovery today which was awarded the 2006 Nobel Prize for Physiology or Medicine. RNAi is a natural process of gene silencing that occurs in organisms ranging from plants to mammals. By harnessing the natural biological process of RNAi occurring in our cells, the creation of a major new class of medicines, known as RNAi therapeutics, is on the horizon. Small interfering RNAs (siRNAs), the molecules that mediate RNAi and comprise Alnylam's RNAi therapeutic platform, target the cause of diseases by potently silencing specific mRNAs, thereby preventing disease-causing proteins from being made. RNAi therapeutics have the potential to treat disease and help patients in a fundamentally new way.
About Alnylam Pharmaceuticals
Alnylam is a biopharmaceutical company developing novel therapeutics based on RNA interference, or RNAi. The company is applying its therapeutic expertise in RNAi to address significant medical needs, many of which cannot effectively be addressed with small molecules or antibodies, the current major classes of drugs. Alnylam is leading the translation of RNAi as a new class of innovative medicines with peer-reviewed research efforts published in the world's top scientific journals including Nature, Nature Medicine, and Cell. The company is leveraging these capabilities to build a broad pipeline of RNAi therapeutics for the treatment of a wide range of disease areas, including respiratory syncytial virus (RSV), liver cancers, TTR-mediated amyloidosis (ATTR), hypercholesterolemia, and Huntington's disease. In addition, Alnylam formed Alnylam Biotherapeutics, a division of the company focused on the development of RNAi technologies for application in manufacturing processes for biotherapeutic products, including recombinant proteins and monoclonal antibodies. The company's leadership position in fundamental patents, technology, and know-how relating to RNAi has enabled it to form major alliances with leading companies including Medtronic, Novartis, Biogen Idec, Roche, Takeda, Kyowa Hakko Kirin, and Cubist. Alnylam and Isis are joint owners of Regulus Therapeutics Inc., a company focused on the discovery, development, and commercialization of microRNA therapeutics. Founded in 2002, Alnylam maintains headquarters in Cambridge, Massachusetts. For more information, please visit www.alnylam.com.
Alnylam Forward-Looking Statements
Various statements in this release concerning Alnylam's future expectations, plans and prospects, including without limitation, the need for novel RNAi therapeutics, Alnylam's views with respect to the potential for RNAi therapeutics, including ALN-RSV, ALN-VSP and ALN-TTR, and the continued clinical development of these therapeutics, its expectations regarding the continued development and recent advances relating to the efficient delivery of RNAi therapeutics, the formation of new alliances, the advancement of its internal Alnylam Biotherapeutics effort and the potential of this effort to generate new business opportunities, its cash position at the end of 2010, its ongoing legal activities, and its ability to continue to generate revenue through existing and new alliances, constitute forward-looking statements for the purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including risks related to: Alnylam's approach to discover and develop novel drugs, which is unproven and may never lead to marketable products; the pre-clinical and clinical results for its product candidates, which may not support further development of product candidates; obtaining, maintaining and protecting intellectual property; Alnylam's ability to enforce its patents against infringers and to defend its patent portfolio against challenges from third parties; Alnylam's ability to obtain additional funding to support its business activities, including through the establishment of new alliances; Alnylam's dependence on third parties for development, manufacture, marketing, sales and distribution of products; obtaining regulatory approval for the clinical development and commercialization of products; competition from others using technology similar to Alnylam's and others developing products for similar uses; Alnylam's dependence on current and future collaborators; and Alnylam's short operating history; as well as those risks more fully discussed in the "Risk Factors" section of its most recent quarterly report on Form 10-Q on file with the Securities and Exchange Commission. In addition, any forward-looking statements represent Alnylam's views only as of today and should not be relied upon as representing its views as of any subsequent date. Alnylam does not assume any obligation to update any forward-looking statements.
Alnylam Pharmaceuticals, Inc.
Unaudited Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
|Three Months Ended June 30,||Six Months Ended June 30,|
|Net revenues from research collaborators||$26,617||$24,601||$51,181||$49,658|
Research and development (1)
|General and administrative (1)||10,107||8,398||21,277||16,114|
|Total operating expenses||38,243||47,013||74,113||80,050|
|Loss from operations||(11,626||)||(22,412||)||(22,932||)||(30,392||)|
|Other income (expense):|
|Equity in loss of joint venture (Regulus Therapeutics Inc.)||(3,919||)||(816||)||(5,497||)||(2,286||)|
|Other income (expense)||43||(24||)||32||154|
|Total other income (expense)||(3,235||)||618||(4,234||)||1,374|
|Loss before income taxes||(14,861||)||(21,794||)||(27,166||)||(29,018||)|
|Benefit from (provision for) income taxes||229||(908||)||211||(1,573||)|
|Net loss per common share - basic and diluted||$(0.35||)||$(0.55||)||$(0.64||)||$(0.74||)|
|Weighted average common shares used to compute basic and diluted net loss per common share||41,991||41,520||41,920||41,460|
|(1) Non-cash stock-based compensation expenses included in operating expenses are as follows:|
|Research and development||$3,246||$3,248||$6,475||$6,282|
|General and administrative||1,822||2,164||3,920||4,267|
|Alnylam Pharmaceuticals, Inc.|
|Unaudited Condensed Consolidated Balance Sheets|
|(In thousands, except share amounts)|
|June 30,||December 31,|
|Cash, cash equivalents and total marketable securities||$396,918||$435,316|
|Prepaid expenses and other current assets||6,021||4,151|
|Property and equipment, net||18,554||18,324|
|Intangible assets, net||535||622|
|Total deferred tax assets||10,611||10,493|
|Investment in joint venture (Regulus Therapeutics Inc.)||1,183||6,435|
|Accounts payable and accrued expenses||$17,823||$22,322|
|Income taxes payable||272||5,644|
|Total deferred revenue||253,058||271,813|
|Total deferred rent||3,381||3,447|
|Other long-term liabilities||168||194|
|Total stockholders' equity (42.1 million and 41.8 million common shares issued and outstanding at June 30, 2010 and December 31, 2009, respectively)||165,478||177,965|
|Total liabilities and stockholders' equity||$440,180||$481,385|
This selected financial information should be read in conjunction with the consolidated financial statements and notes thereto included in Alnylam's Annual Report on Form 10-K which includes the audited financial statements for the year ended December 31, 2009.
SOURCE: Alnylam Pharmaceuticals, Inc.
Alnylam Pharmaceuticals, Inc.
Cynthia Clayton, 617-551-8207
Senior Director, Investor Relations and
Patricia Allen, 617-551-8362
Vice President, Finance and Treasurer
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