Alnylam Pharmaceuticals, Inc. (ALNY) Earnings Call Transcript & Summary

Good afternoon, again. My name is Navin Jacob. I cover SMID cap biotech and large-cap pharma here at UBS. I'm happy to be here today with Alnylam Pharmaceuticals. And with -- and from Alnylam, I'm excited to have with us President and COO, Yvonne Greenstreet. Yvonne nice to have you here today.

Thanks, Navin. I'm really happy to be here as well. I mean just a few brief introductory remarks with respect to Alnylam. Many of you may know our story, but just to emphasize that we are the leader in RNAi therapeutics. We've been successful in bringing 4 RNAi medicines to market. And this is 3 that we are directly commercializing ourselves, ONPATTRO for hATTR amyloidosis patients with polyneuropathy, GIVLAARI for patients with acute hepatic porphyria and OXLUMO for the patients with primary hyperoxaluria type 1. And then one that's been commercialized by our partners at Novartis that's Leqvio for hypercholesterolemia. And this means that we're in a growth phase in our company for the foreseeable future. But as many of you are aware, we've also got a very rich clinical pipeline with over a dozen clinical programs, covering both rare and prevalent diseases. And we also have over 25 programs in preclinical development, targeting a range of rare and common diseases across 4 tissue types, the liver, CNS, eye and lung. And I think what's particularly exciting about Alnylam is not only do we have marketed products, a rich pipeline, but we also have our own organic product engine, which we plan to generate 2 to 4 new INDs per year over the next few years, growing to 4 per year by 2025. And then from a sort of broader strategic perspective, we recently announced our P5x25 goals, which is our road map to bringing transformational medicines to patients and delivering exceptional financial performance and profitability by 2025. That's a quick summary of Alnylam, where we are and what's in front of us, and lots going on, Navin.

Yes. And do you -- I mean it is rare to see a company -- very rare, I can count them on one hand, see a company develop and commercialize 4 assets in a span of 2 years -- or 2 or 3 years, let alone in a span of 10 years, and you've done it in such a short period of time and all in completely different therapeutic areas. And to that point, I want to actually touch upon something you just said with regards to your long-term aspirations and the 5-year plan that you had put out, the long-term guidance. What was unique about that also was that you had not only given long-term guidance on revenues, but also from a perspective of this aspiration of being a top 10 -- top 5, excuse me, biotech company. What was the genesis and rationale behind giving that kind of guidance? I'm curious.

Yes, it's a very good question, Navin. We've actually got a kind of decade-long history of giving guidance. We had 5x15, and then we had Alnylam 2020, and it's been very successful in focusing us on the next chapter ahead of us. And we actually met, exceeded those 2 sets of guidances. So when 2020 was coming to an end, we thought, well, it's time to think about 2025. And as we look forward to the future, it's obviously about patients. It's obviously about products. It's obviously about continuing to build the pipeline, but it is also about generating revenue growth as well as sustained profitability. And it's -- we -- it's a bold plan, it's an ambitious plan, but we have a track record of executing, and we intend to do this going forward.

Perfect. [Operator Instructions] Yvonne, maybe we can start with the hATTR franchise. Where do you think the Vutrisiran franchise fits relative to ONPATTRO? Obviously, Vutri is going to go after not just PN but the cardiomyopathy as well. How do you see the landscape evolving near term and long term, both -- not only in PN but in CM as well. Just I want to start off broad before digging into some of the details around the trials that you're going to be...

Look, I mean, we're very excited about our TTR franchise. We see this as a substantial business opportunity if you look at the size of the market, but also the impact that we can have on patients. And obviously, now with ONPATTRO for patients with hATTR amyloidosis with polyneuropathy, but also as we look forward to the future, ONPATTRO in patients with hATTR amyloidosis with cardiomyopathy. We were delighted with the results that we got for HELIOS-A and moving forward with bringing Vutrisiran to patients initially with hATTR amyloidosis with polyneuropathy and then subsequently with cardiomyopathy. So we think that ONPATTRO, together with Vutrisiran, really puts us in a strong position to meet the needs of patients broadly with TTR amyloidosis and moving forward with those -- both those medicines. Obviously, ONPATTRO is a medicine, and then the program for Vutrisiran.

And with the HELIOS-A, you showed the 9-month data, you're going to have cardiovascular -- secondary endpoints look at the 18-month time point. What exactly are those endpoints? And is there a potential to look at event rate, which I'm not sure is part of that secondary -- those secondary end points?

Yes. Look -- I mean, we're really excited actually about the exploratory cardiac data that we've seen so far out of the HELIOS-A study starting Vutrisiran. Kind of it continues to provide really strong supportive evidence for the efficacy of Vutrisiran in patients with cardiomyopathy in advance, obviously, of the definitive label-enabling studies for HELIOS-B with Vutrisiran and then APOLLO-B with ONPATTRO. And I think it's important to note that we're confident because we have a foundation of strong exploratory cardiac data from the original APOLLO study, but also other published cardiac data from studies with Vutrisiran. You asked a question about the 18-month analysis in May 2021, and we will be looking at a number of exploratory end points, which will continue to characterize Vutri's impact on various cardio manifestations of the disease, including biomarkers of cardiac stress, so NT-proBNP, echocardiographic parameters of left ventricular wall thickness and longitudinal strain, and then cardiac amyloid burden to the use of technetium scanning. And we think that positive data coming out of the 18-month analysis will continue to strengthen, I think, the conviction around our TTR sciences, both ONPATTRO and Vutrisiran, for ATTR cardiomyopathy and through Cardi B studies. So we think we're setup to deliver positive results on these end points as we look to analyze the data towards the end of this year.

Got it. But there isn't necessarily an event -- a look at that 18-month time...

These are the analysis that we are planning to do at this point in time.

Got it. And would HELIOS-B -- are there landmark analyses, interim analyses that we should -- or rather, sorry, are the interim analysis event-driven? Or are there a landmark analysis that will be occurring?

So it's important just to put kind of HELIOS-B into a little bit of context. So just as a reminder, in HELIOS-B, we're evaluating Vutrisiran in about 600 patients with ATTR amyloidosis with cardiomyopathy. And the primary end point is a composite outcome of mortality and recurrent CV events, and this will read out at 30 months. We're also planning to do an interim analysis in HELIOS-B. Obviously, we need to get alignment with the various regulators around this, the FDA or the EMA and other regulators, which could potentially allow for an accelerated readout and subsequent regulatory filing. Obviously, since we're in discussions with regulators, we haven't yet defined the specifics of the interim analysis as these would obviously need to be agreed with the various regulatory agencies. So this is work in progress, and we'll update you as things progress and we have more information to share.

Got it. You have a 6-month dosing schedule that you're working on as well. And you're also working on some other life-cycle management programs, a new platform, I think, that you're working on called IKARIA. Would you be able to chat about that and what progress you're making there?

Yes. No, we're really excited about Vutrisiran. We believe that Vutrisiran has the potential to have a best-in-class profile as you point out initially with a quarterly regimen, but then following on with an sNDA for a 6-monthly regimen. And we're particularly excited about the 6-monthly regimen because it actually ties in really nicely with visits that patients have with their cardiologists. They go to see their cardiologists twice a year. When they go see their cardiologists then they can receive their Vutrisiran. So we're very excited about that. But you're right. We continue to want to be innovative in meeting needs of patients. And we recently communicated a platform called the IKARIA platform, which we think is a further step in innovation, where we would be looking at a 1-year regimen, greater than 90% knockdown. We think it's got a very high probability of success given our understanding and track record so far. And so a future next step for this franchise would be bringing forward what we're calling TTRsc04, and we would be planning to file a CTA/IND at the end of 2022. So that's the rough timings for that. Very excited about the next step with Vutrisiran, but such an important therapeutic area we're continuing to invest in bringing innovation to patients, so lots going on.

Got it. And then just lastly on the TTR franchise, we're often asked about -- as I'm sure you are, about competitive approaches, such as gene editing, gene therapy. Wondering how you're thinking -- considering and thinking about potential competition from other modalities.

Yes. Look, I think additional therapeutic options are beneficial to patients. And we really see the TTR area as a market growth story, where it's going to be a multibillion-dollar opportunity, and there's room for many players. With respect to gene editing specifically, what I would say is that CRISPR/Cas9 technology is exciting, but still in very early stages. And there's a lot that needs to be learned still around efficacy, particularly into patient consistency and longer-term durability and safety as well. So it's in the early stages, I would say. There have been some recent challenges with gene therapy. I think as we started on the journey with our platform in RNAi nearly a couple of decades ago, it takes a while for these new modalities to begin to prove themselves and reach patients. So I think there's still a journey ahead of companies like Intellia. I think it's also worth just mentioning that I think the development path for gene editing companies like Intellia is actually going to be quite challenging, just given that their existing therapeutic interventions on the market already for patients probably needing to do a Phase III against a TTR silencer for hATTR polyneuropathy or a silencer or a stabilizer for ATTR cardiomyopathy. So I think the development path is not necessarily straightforward. And then I think access is also going to provide its own challenges. Many of these patients with hATTR amyloidosis, particularly patients with wild-type cardiomyopathy, are -- they're seniors. They're in their 70s and 80s. And I think there is an aspect to access, where payers may not want to pay millions for one-and-done therapy, which, by definition of this age group, is going to have a relatively short impact, when there are going to be a lot cheaper alternatives on the market that have established efficacy and safety. So I think there are still some ways to go. I'm sure if gene editing ends up being successful in time, there will be a small subset of patients that will elect to receive an intervention that could be a potential cure. But I think when we think about what we're doing, Navin, with respect to developments in our TTR franchise, I mean, we've just talked about the biannual dosing for Vutrisiran, the potential for annual dosing with our new platform, I think the RNAi approach is proven and I think has extensive human experience and I think will continue to offer patients unprecedented freedom from their disease. So we're very excited about what we're bringing to patients and welcome other therapeutic modalities that also could potentially make a difference to patients.

Fair enough. And then on GIVLAARI, you've talked about reduced patient flow through the system in Q1 and obviously, pandemic affecting patient flow for many therapeutic areas that porphyria often presents in the emergency room setting and can be intermittent. How long do you think it takes to make up some of these opportunities if there's a sort of a waxing and waning of demand that's not helped by the pandemic? And when do you think patient flow can return to pre-pandemic levels?

Yes. Yes. No, good question. Just to remind everybody that GIVLAARI is our RNAi therapeutic for the treatment of patients with acute hepatic porphyria. Actually, very respectable results in Q1. We achieved $25 million product revenue. That was 11% quarter-on-quarter growth and with approximately 225 patients on the drug. But yes, I think results were a little weaker than we expected, primarily due to the resurgence of COVID at the beginning of the year, which I think has had an impact on patient flows to the health care system. We're actually quite encouraged because we saw some acceleration of growth in March as the pandemic began to ease. And looking forward, we hope with the continued high vaccination rates, particularly in the U.S. and in a few countries in Europe, we will see growth continue to pick up. And we expect to see steady and continuous growth, driven by, obviously, patient identification and treatment, but also by geographic expansion -- continued geographic expansion. So we're optimistic about the potential for GIVLAARI as we do expect patient flow to return to a much more normal setting. And we hope the positive trend that we've seen recently will continue if we can all get vaccinated and continue the great progress that we've made in -- at least in many western markets in addressing the pandemic.

My arm still hurts from my second dose, and it's been 4 days. I won't say which one I got.

Don't say which one you got, but I congratulate you. Congratulations.

Yes. So just on OXLUMO, you're going to have more data this year for more severely impaired patients in ILLUMINATE-C. How large is that population?

Yes. No, it's a good question. Again, just to remind people that OXLUMO is our RNAi therapeutic for the treatment of primary hyperoxaluria type 1. It was approved in late 2020, so fairly recently. And important to state that OXLUMO is actually the first ever RNAi therapeutic indicated for patients of all ages, including children. And so the first quarter of 2021 was really our first full quarter with OXLUMO on the market, and we achieved $9.1 million in global net revenues. And what was interesting actually was where the growth came from. We saw utilization of OXLUMO actually across all age groups and eGFR categories as well as faster than expected conversions from our early access program in the -- in Europe. And I think that's driven by, I think, the devastating nature of this disease, the progressive nature of this disease as well as, I think, transformative potential of OXLUMO. And we're seeing increased disease awareness and, importantly, on the access front, new headwinds there. We've got round about 5 VBAs that have been finalized with commercial peers in the U.S., and we've now got coverage for about 2/3 of U.S. lives. So actually we're very pleased with where things are. I mean OXLUMO is going very, very well. ILLUMINATE-C, which is the one I think you were drawing attention to, is our Phase III study, and this is specifically for PH1 patients of all ages, but those with more severe renal disease, so those with an eGFR of less than 45. And it also includes patients on dialysis as well as patients who have systemic oxalosis. And we'll be reporting top line results in -- around the corner mid-2021. So we should be able to see those data together soon. And clearly, getting positive ILLUMINATE-C results would expand the overall market and allow us to address really the kind of full range of patients with symptomatic PH1 in the U.S. and Europe. But as I said, I think even with the data that we have in hand to date, we're seeing very broad use of OXLUMO. If I try and kind of size the overall opportunity, I think we have indicated that we think that the PH1 market represents around about a $500 million opportunity. I think hard to pass it out into all the different subgroups. But I think what is encouraging is actually we're seeing the -- within the use of OXLUMO, it's appropriately prescribed according to the label, but we're seeing a good range of ages of patients as well as severity of disease. So we're quite excited about the potential for OXLUMO.

And you brought up access, OXLUMO that you said roughly 2/3 of lives covered. I know ONPATTRO and GIVLAARI, you have about 98% of lives covered there. Obviously, OXLUMO, early, it is at the same sort of time point for ONPATTRO and GIVLAARI launches. Do you -- is the OXLUMO on track, ahead of schedule getting to where you want it to be?

Yes. No, look, that's a really good question. I mean we have prided ourselves on how we've approached access of the company in general. I think we've come up with some very innovative approaches with mechanisms of addressing the needs of payers in different ways depending on the different products that we brought to market. I think it's important to clarify that -- let me talk about coverage for 2/3 of lives. That's actually 2/3 of the U.S. lives, that's not compared to -- globalized. I just want to make sure that we're clear about that data point. Navin, that's actually, I think, pretty good. OXLUMO was approved just 6 months ago. And it's actually not a dissimilar kind of rate of progress that we were able to achieve with ONPATTRO and GIVLAARI in their initial stages of launch. And I think what this says to me is that actually, at Alnylam, we've built up a really robust payer capability, and the way that we engage with payers, engage early, we try to understand what their challenges are. Because actually at the end of the day, what we want is to make sure that we can bring our transformational medicines to as many patients as possible. I think as we continue our discussions with payers, both in the U.S. and around the world, we'll continue to see progress in this regard and increased access. But we're very pleased about where we are. It's pretty similar to what we've achieved for GIVLAARI and ONPATTRO.

You noted that you've been on the forefront and have innovative payer structures. And certainly, Alnylam, from everything I've seen has been the leader in novel VBA, or value-based pricing, mechanisms. At this point, and I don't know this much as I should, but what percentage of your contracts that you have or the folks that you're working with are via VBAs versus traditional contracts?

So I mean, clearly, as I said, our goal is to ensure that we can provide access to patients, whether they're on Medicare, Medicaid, commercial, et cetera. We don't break it down. But what we do do is talk about the percentage of lives that we're able to get covered in the U.S.

Got it. Okay. And then just on some of your pipeline products, ALN-AGT, and for folks who are not as familiar if you could give a 1-minute background on AGT. But then I do have a couple of specific questions. The study, you're setting it as monotherapy, but also with Ras inhibitors, still early. But how do you see monotherapy use versus combination use being utilized?

Yes, yes. So as a reminder, ALN-AGT is RNAi therapeutic that's in development for the treatment of hypertension. And as many of folks are aware, I mean, hypertension is a leading cause of cardiovascular morbidity and mortality worldwide. And for those of us who are either hypertensive or new hypertensive, that is incredibly common with the number of pills that need to be taken, compliance is a significant issue. And many patients are not able to achieve tonic control of their blood pressure and, hence, all the consequent morbidity and mortality. So we think that ALN-AGT really offers a completely new way of thinking about hypertension, where we can kind of reimagine how hypertension gets treated. I think because of our technology with RNAi therapeutics, you're able to affect clamped pharmacology, and this results in tonic blood pressure control. As you know, many patients with hypertension have a lot of volatility, and this is actually what causes quite a lot of the issues. But we can actually affect tonic blood pressure control, which is quite important, through very infrequent dosing. We talked about the dosing with our new platform, IKARIA, where we're looking at annual dosing. I mean when we think about the possibility with ALN-AGT, it could be anything from quarterly to biannual dosing. And I think it's this that really allows us to think about really just changing how hypertension is treated a little bit like Leqvio in hypercholesterolemia, a couple of subcu injections sorts out your cholesterol. We're hoping that with ALN-AGT, we'll be able to demonstrate in a very similar way that a couple of subcu injections will sort out your blood pressure. In our Phase I study, we saw, I think, a 17 millimeter of mercury reduction in systolic blood pressure. And that's a significant reduction. And remember that in developing new therapeutic approaches for hypertension, really that's the approval end point, demonstrating a reduction in systolic blood pressure. So we're moving on from Phase I now. We're about to initiate our Phase II cardio program in mid-'21, so just around the corner. And as we said, we're looking at evaluating ALN-AGT for monotherapy in our KARDIA-1 study. And then in KARDIA-2 in combination with a RAS inhibitor. I think, given what I said about the numbers of medications that the patients with blood pressure have to take, I think studying ALN-AGT in combination is going to be important. When we get the results from these 2 studies, then we'll start to think about what our Phase III design should look like, what our path to market should look like and then what our commercial positioning should look like. So I think at this point in time, it's hard to say kind of exactly how we see this being utilized in mono versus combo. But what we have wanted to do is make sure that we study these 2 different situations in our Phase II program. So we're primed to be able to move this forward into Phase III in a broad way as appropriate.

And I don't know if -- I don't recall having this discussion with you before or knowing how you are thinking about the Phase III, just you brought it up. I mean do you definitively need cardiovascular outcomes for approval? Or can you use -- whether it's some kind of tertiary end point like a walking test or a combination of CV markers for approval in this setting?

No, that's a really good question. Actually, developing antihypertensives from a regulatory perspective is a pretty straightforward endeavor. The requirements are to show a 5 millimeter of mercury reduction in systolic blood pressure. That's the approval end point. Now, clearly, as we think about the commercial pathway for this program, we will be thinking of studying other end points as well, but I think it's too early at this point in time to be much more specific. But the pathway to approval is actually pretty straightforward.

You're also studying your RNAi tech in several CNS indications. How important is your science to your 5-year goal or 10-year goal? When are you anticipating seeing -- I don't want to say tangible results, but the results that will lead to an approvable product?

Yes. Yes. Yes. Look, I mean, I can't tell you how kind of excited I am about the opportunity to get into CNS disorders. There's just so much medical need, and there's so much opportunity that we can look to address with our technology. Just to say kind of where we got to, we have actually demonstrated the ability to deliver siRNA in preclinical studies to the key anatomical regions of the brain and spinal cord and see very wide distribution. And we'll be moving our first CNS program into the clinic in the middle of this year. So again, just around the corner. I think this is going to be -- as I said, I couldn't be more excited about the potential here. And that program is ALN-APP, so target amyloid precursor protein. And we're developing it for the treatment of early onset Alzheimer's disease and cerebral amyloid angiopathy. Now cerebral amyloid angiopathy is a much rarer condition, there are about 500 patients for this worldwide. But early onset Alzheimer's disease is multiples of that, around about 50,000 patients worldwide. And if we're able to deliver a positive proof-of-concept in these 2 indications, I think it also gives us a reason to believe that this approach could also have an impact on some of the much more prevalent conditions like Alzheimer's disease or sporadic CAA, cerebral amyloid angiography. So this -- we're some ways off that yet, okay? Our initial human POC data expected in 2022. But if we're able to deliver success here, this really does start to unlock a lot of opportunity for RNAi therapeutics and helps address the huge, huge unmet medical need that everybody is aware of in the CNS set of diseases. We've also got a preclinical program in Huntington's disease. And we've actually got kind of another half dozen-or-so additional programs that we're working on with our partners at Regeneron. So to get some positive clinical data. I think the CNS portfolio, does really represent a significant part of our overall growth story over the coming years, so I think we also look forward to.

You mentioned positive proof-of-concept or rather a proof-of-concept readout in 2022. So how do you define that for something like early onset Alzheimer's? Is it you're just looking for knockdown of APP? Just trying to understand how you define success.

Yes. We -- I mean, there are a number of parameters that we're looking at, both PD as well as early insights into safety and efficacy, but we're not specifying exactly what those end points are at this point in time.

Fair enough. And then you mentioned Huntington's disease. How large is that market opportunity? And any learnings from Roche's issues with tominersen, and then read-throughs from that antisense assets failure?

Yes. No, look, Huntington's disease is a terrible disease for patients and their families. There are about 30,000 patients in the U.S. with Huntington's. And you talked about some of the issues that have been seen with Roche and tominersen. I mean it's just devastating for the patient community that I think was very hopeful that there would finally be an intervention that can make a difference to this disease. We think that the results that were seen by Roche were probably impacted by the pro-inflammatory that you see of single-stranded antisense oligos that are used here. And I think the other thing to point out is that the other oligo approach use a facilitated delivery mechanism. And that's quite an inefficient way to get an oligo into cells. So they probably had to push the dose quite high, and that's maybe why there were a number of findings seen like elevated protein levels of the CSF, which I think indicates the pro-inflammatory from the part that I was speaking to. We've looked at preclinical data. Obviously, we are a little behind these programs. We've got preclinical data in nonhuman primates, and even done some comparative studies in the preclinical setting. And early days yet, but we are encouraged by the overall safety profile. I think the other thing to highlight is that we're using a targeted delivery system for our enzymes. This approach, I think, has been very successful in the liver. And so we're using the kind of liver playbook and applying that to how we move forward for approach with respect to the central nervous system. So we've got efficient uptake and broad distribution. So we're committed to our Huntington's program. We hope that we'll be able to bring an agent of patients that will have good knockdown of Huntington's, better than what's been seen with the antisense oligo platforms. But also better tolerability is really more to patients. And as you pointed out, I think getting data out of ALN-APP is going to be a helpful step-on our journey towards understanding the impact that we could handle CNS diseases.

You mentioned liver, that's a great segue to another area that you're studying RNAi tech in, which is NASH, which may be surprising to a lot of folks because that is considered a very broad market that many companies are going after. Very interested in what you're doing there, I've covered NASH at least for quite some time. So the several targets being tested. You're studying specifically, ALN -- the HSD program there. How are you thinking about RNAi and NASH? Just even taking a step back, what made you interested in going after that space? What do you see today?

That's a really good question because as we've built our strategy at Alnylam, we have focused very much on leveraging understanding with respect to genetics, finding diseases where there's a biomarker and then, obviously, a regulatory approval. Our efforts in NASH, the first being ALN-HSD, is in partnership with Regeneron and actually targets a genetically validated protein called HSD17B13, where it was shown that a loss of functional mutation was protected against liver fibrosis and inflammation across various forms of liver injury. So this really gave us the impetus, if you like, to say this could be a really interesting target to go after. So -- and look, you know how challenging NASH has been, but it's a very important disease. I mean the 20 million Americans with NASH, that's the #1 or likely to be in the near future the #1 reason for liver transplantation. And we're in Phase I. It's early days yet. We have a second NASH program. I'm not sure how many people are aware of that, but it's an RNAi therapeutic that is targeting PNPLA3 in massive preclinical development. So we are definitely committed to trying to see if we can bring RNAi therapeutics to bear to patients with NASH.

Well, you certainly have a lot of products that we could keep talking about for a very long time, but we're right up against our time. Maybe a minute early here, but given that it is the afternoon, I will let everyone off the hook and start your evening a little bit early. Thank you so much to Yvonne Greenstreet and Alnylam for joining us today. Thank you, folks.

Thank you, Navin. Anytime. Cheers. Bye-bye.