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

Great. My name is Gena Wang. I'm SMID-cap biotech analyst at the Barclays. Welcome to our first in-person Global Healthcare Conference post pandemic. I hope pandemic is ending. It's really nice to see everyone in person and I would like to also thank all the participants, investors, companies and especially our event team and the corporate access team who made this event possible. With that, I would like to introduce our first presenting company, Alnylam. Jeff Poulton, Chief Financial Officer, will be with us today. Thank you very much, Jeff.

Thank you. Nice to be here.

Yes. So before I start with any questions, do you want to just highlight very high-level overview of Alnylam, how much has been achieved in the past several decades now?

Yes, absolutely. We're a company that's pioneered a new class of medicines RNAi, made tremendous progress. Most recently, we rolled out a new set of 5-year goals called P5x25, which we think has us on a trajectory to be a leading biotech company. The first year of that 5-year strategy was completed in 2021, made very good progress, both commercially as well as advancing programs through the pipeline.

Very good. Let me know if you can't hear very well. So maybe I would just start with vutrisiran, ahead of your PDUFA date, April 14, how is the launch preparation so far?

Yes. I think we're in a good position to launch the drug, pending the FDA decision. Just for a little bit of context for folks that may be new to the story, our first commercial product that we launched in 2018, ONPATTRO, is labeled for hereditary ATTR with polyneuropathy. So that's sort of the first-generation product. That product's done very well for us commercially. In 2021, we did $475 million in revenue, which represented 55% growth. Vutrisiran would be the second-gen product. ONPATTRO is an LNP delivered product, so it's an every 3-week IV-infused drug. Vutrisiran is a GalNac delivery. So it's got different administration. It's a subcu administration at launch. It will be once a quarter administration, and then we're collecting additional data that we think will actually move it to every 6 months. But the label likely at approval will be very similar to ONPATTRO. So in that same patient population, hereditary ATTR with polyneuropathy, so we'll be able to leverage a lot of the existing infrastructure that we've already built. I think the launch sequence in terms of timing will be very similar to what we did with ONPATTRO. So first launching in the U.S. and then follow-on launches outside the U.S., likely 2023 for outside the U.S. And I think the approach that we've taken with access and pricing with ONPATTRO will do similar things with vutrisiran. I certainly think that we'll have BBAs in place at the time that we launch vutrisiran. So we're ready to go. We're excited about it. We think this is a big advancement for patients in terms of convenience for a once-a-quarter subcu relative to an every 3-week IV. So we're excited about the opportunity here.

So several questions here. So given the high compliance with ONPATTRO, if I remember correctly, it's over 90%. How do you see this evolving when vutrisiran launched. Do you see the new patient on board or switcher from ONPATTRO or TEGSEDI?

Yes. So you're right. I think one of the remarkable things about ONPATTRO, given that it's an every 3-week IV, is the compliance rate that we've seen. So we've seen that at north of 90% since launch, again, which I think is pretty remarkable. In terms of what we expect in terms of dynamics when we launch vutrisiran, I think given the convenience advantage of a once-a-quarter subcu, we do anticipate that the vast majority of new patients that start when vutrisiran is available are going to start on vutrisiran. We think for patients that are on ONPATTRO, we think over time, there's going to be cannibalization of a significant portion of that. But there will be some stickiness there, too, we think. Again, given the fact that we've seen 90% compliance, we think there are some patients that are going to be comfortable, that are going to be doing well, that are going to be resistant to change. There's actually even some social benefit associated with going to an infusion center for some patients. And so we do think there's going to continue to be a place for ONPATTRO. Also, just to be clear, again, we're not going to be launching vutrisiran globally all at the same time in all the markets where ONPATTRO is available today. So just initially in '22, it's likely just to be in the U.S. where we're going to start to see some of that cannibalization of ONPATTRO; ex U.S., likely for 2022, it's just going to be ONPATTRO.

Okay. Great. So how do you see that evolving going forward U.S. versus ex U.S. contribution?

Yes. Today, again, the $475 million that we did in 2021 was about 55% ex U.S., 45% U.S. And I think over time, that we're likely to see a pretty good balance, U.S. versus ex U.S. Again, I don't think that we're going to see any ex U.S. revenue for vutrisiran in 2022. That will be 2023 and beyond. I should probably just take a second to talk about why we think vutrisiran accelerates the growth of the franchise. There's a few things here, I think, that will be -- that will drive that incremental growth. One is we think that for the mixed phenotype patients right now that are sometimes choosing between cardiomyopathy drug and a polyneuropathy drug, we think this is going to be a more competitive drug, vutrisiran. So we think we'll get a higher share of mixed phenotype patients likely with vutrisiran relative to ONPATTRO. We think for patients that are looking at -- that are already on a therapy that are looking to switch to a new therapy, this will be more appealing, just given the convenience benefit associated with it. So ex U.S., where we've seen a lot of switching from stabilizers since we launched ex U.S., again about 50% of the revenue that we've generated ex U.S. has come from switchers, switching patients from stabilizers. So we think that will even accelerate that switching. And you mentioned TEGSEDI, I think patients that are on TEGSEDI, which is a pretty small proportion of the market, the hereditary PN market, we do think this will be attractive in terms of switching for those patients as well.

How's U.S. regarding the switching from TEGSEDI?

Yes. So this is sort of the interesting dynamic. And I think it's one of the reasons why the ex U.S. ONPATTRO sales have actually eclipsed what we've done in the U.S. So tafamidis didn't get approved in the U.S. for hereditary PN, right? So there is no switching from stabilizers in the U.S., right? It's all really naive to treatment patients that we have in the U.S. Ex U.S., tafamidis got approved 10 years ago for hereditary PN. So they've really been developing the market in Europe and Japan. And that's really been the source of switching to ONPATTRO. There's patients that have been treated with a stabilizer for hereditary PN that have been seeking a new treatment. And so in addition to treatment-naive patients in Europe and Japan, there's been a source of switch patients. So again, about half of the business outside the U.S. has been switches and half have been naive to treatment. We didn't have that source of switching in the U.S. because tafamidis didn't get approved in hereditary PN. So again, I think that's probably the primary reason that ex U.S., the business has grown faster and is actually larger than the U.S. business today in PN.

So regarding the U.S., you mentioned that mix phenotype, polyneuropathy and cardiomyopathy, based on your experience, what percentage of those patients are actually on those drugs?

Yes, I don't know that we have really good data on that to give you a percentage. Again, I think we've competed effectively there. I don't have a market share there. Again, the comment I was making was around vutrisiran that we think given the convenience advantage that we think that market share in that segment is going to go up. But I don't have a good number to give you today in terms of how effectively we're competing there in terms of share.

Okay. Good. And another question is regarding pricing. So how do you see -- I assume initial pricing will be pretty comfortable. But moving forward with the expansion to the cardiomyopathy population, how do you see the pricing evolve for vutrisiran?

Yes, I think -- obviously, we haven't priced the drug yet, but I think your logic that you use is sound. The assumption is that the label that we'll get, assuming regulatory approval in the U.S. would be very similar to the current label that we've got for ONPATTRO, so in that same patient segment, hereditary PN. And so I would anticipate the pricing will be generally similar as a result of that. The more interesting question is how does that evolve over time as we hopefully expand the label and open up a much larger opportunity. So the hereditary PN opportunity globally, we think there's about 50,000 hereditary patients globally today, probably 20,000 to 30,000 of those are appropriate for treatment with PN -- a PN drug. The opportunity that we're trying to unlock both with APOLLO-B and HELIOS-B is the cardiomyopathy opportunity, and the wild-type part of the market is the most significant part of the cardiomyopathy opportunity. And we think conservatively, there's 200,000 to 300,000 patients, wild-type patients. So we're looking at 10x the market opportunity if we're able to unlock the cardiomyopathy opportunity. So that's certainly where I would expect that price will come down over time. I think a good comparison is to look at the price of tafamidis in the U.S. today for cardiomyopathy. And it's roughly about half the price of ONPATTRO today. Again, ONPATTRO is in that much smaller segment today. So that's probably a good initial guide in terms of how to think about where this may end up over time, but yes, that would be the expectation.

So another price-related question. So vutrisiran, you're also testing once every 6 months. If that one turn out to be successful, then how would the pricing be like? Will you adjust now with a less frequent dosing? How the price will...

Yes. I mean, I don't think that I would change anything for every 6-month dosing than what I just articulated for vutri first in the PN population and then the cardiomyopathy population. I think the pricing decision is going to be more driven by the size of the market opportunity than it will be every 3-month versus every 6-month dosing. That would be the expectation.

Just wondering, does that mean every dose, every time when you give the patient, the price will be different [ and when one ] goes to the once every 6 months dosing?

Yes. I mean you'd have a different price.

It would be a higher price?

It would be.

Annual price would be the same.

That's right. That would be the expectation.

So how would you be able to control that?

It will be a different dosage form, right? So it would be a 50 milligram versus 25 milligram, 50 milligram every 6 months. So yes, so it would be the same annual price.

Okay. Good. Now switch to APOLLO-B. I know a lot of investors are focusing on that especially after BridgeBio's data. So maybe I understand the key focus may be the placebo arm, how the 6 minutes walk test will be performed. Can you just walk us through like how exactly you would do the 6 minutes walk testing, the protocol and also how frequent you would do the testing?

Yes, I'm actually surprised it's taken you about 15 minutes to get to this question. This has certainly been the sort of #1 topic of discussions that we've had with investors since the end of December when BridgeBio announced the results of their study, and we were surprised by that result just like they were. And just to sort of recap like what we understand about that study today is it failed on the primary endpoint. The design of that study is very similar to the design of APOLLO-B. And so the primary endpoint, 6-minute walk, and it failed because the patients did not progress on the placebo arm in the study. But the thing that was really strange is if you looked at the secondary end point, so KCCQ quality of life as well as [indiscernible] the patients that were on the placebo arm did progress as you would have expected. And sort of if you compare the results, secondary endpoints to what Pfizer had in their ATTRACT study, they -- on those 2 measures, they performed as you would have expected. So it certainly seems like there was something related to the conduct of the 6-minute walk endpoint that caused the problem. And that's essentially what BridgeBio has speculated as well. They've talked about contexture or training bias. So that's sort of where we are on understanding what happened in their study. Now as it relates to APOLLO-B, we remain confident in the study. And there's a variety of reasons that we're confident in that study. I'd start with the rigorous diagnostic criteria. So the patients that are in the study, we think, are the right patients that have ATTR cardiomyopathy, either hereditary or wild-type form of disease. Patients have to be diagnosed either via biopsy or technetium scan. And those that are diagnosed via technetium scan have to have Perugini Grade 2 or 3 uptake, right? Our understanding is BridgeBio may have had some that were Perugini Grade 1 uptake. Let's see, the second thing is as we've excluded AL amyloidosis patients as well as other forms of cardiomyopathy, so the starting point is we think we've got the right patients in the study. To your point around the conduct of the study, and I think we're confident here. I think that starts with the fact that we've got 10 years of history of doing studies in this disease. So we know the investigators. We know the sites, we know the right vendors to work with, got a lot of experience here. I think in terms of the conduct of the 6-minute walk test itself, Akshay likes to refer to this as sort of having a flight plan, right, initially, to sort of prepare for the flight. And then as the flight gets underway, you've got all your dials in front of you that you're constantly monitoring and making adjustments, right? We're doing those things today to make sure that that 6-minute walk test itself is administered the right way. I think also in terms of conduct of the study, it's a conservatively powered study. It's a 1:1 randomization. Again, BridgeBio was 2:1 randomization. The initial size of the study was targeted at 300 patients. We over-enrolled, right so that gives us additional confidence. We ended up around 360 patients in the study. And then the last thing, which is really more specifically to your point is, we manage the risk around the possibility of a training bias around the number of tests that the patients are doing around baseline. So in screening, in the Alnylam APOLLO-B study, there's one 6-minute walk test that's administered. Our understanding in the BridgeBio study at screen is there's two 6-minute walk tests that are conducted for all patients. And if there was a greater than 15% difference in those 2 tests, there was actually a third 6-minute walk test that was administered in the BridgeBio study. So we had one at screening, they had either 2 or 3. So I think that could be one of the things, again, from a training effect that puts us in a better position, let's see. So also the patients that are in the study, we've got the right sort of broad population. We've talked about the target for the study in terms of hereditary versus wild-type. We've targeted 20% hereditary, 80% wild-type, and that split would be much more consistent with the split that Pfizer enrolled in the ATTRACT study. I think in the BridgeBio study, they only had about 10% hereditary patients. We've got NYHA Class I through Class III patients in the study. And we do -- did allow up to 30% at baseline of patients to be on tafamidis, but they had to be patients that were progressing in the course of the disease to be enrolled in the study. And then the last thing that I would say that gives us confidence is just the mechanism of action, right, the [indiscernible] MOA and the data that we've already gathered that we think supports and increases confidence that this is going to be a positive study. So both in the APOLLO and the HELIOS-A studies, we had 10-meter walk, which is different than 6-minute walk, but we think there's a good correlation there. And we had success in both APOLLO and HELIOS-A on the 10-meter walk test. Also in APOLLO, the post hoc data we saw in CV events, hospitalizations and mortality, we saw a benefit. We've seen an investigator study out of the National Amyloidosis Center in the U.K. that looked at hereditary patients with CM where they showed a benefit on 6-minute walk. And then lastly, on HELIOS-A, some of the exploratory cardiac data, I think, was pretty encouraging that we shared earlier this year, including the technetium data where we showed amyloid regression in the heart. So there's a lot of reasons, I think, for us to be confident. And yes, we're looking forward to the readout, which we anticipate middle of this year.

Many questions.

Lots of questions. Yes.

Yes. So maybe first, like when you say mid this year, are we more like likely is a 3Q time frame, July...

Yes. I mean I'm not going to give any more specificity than that. I mean it's a 12-month study, the enrollment completed May of last year, and we've just said mid, and for Alnylam convention, that's Q2 or Q3.

Okay. Okay. Good. And I have several questions. First, I think that you mentioned the biopsy part. Just wondering how many patients actually have the actual biopsy and...

Yes. We're not giving -- we're not providing that level of detail. So I don't have that to share. Yes.

Okay. I recall BridgeBio is about 20%. So I'm just wondering, is that similar ballpark or...

Yes. I don't have that detail for you, Gena.

Okay. That's fair. Second question, I think there's quite some investors mentioned that -- another question is like how would you -- if you have overlap sites with, say, other trials, how would you make sure your conduct is more rigorous than the others?

Yes. I mean, again, it starts with the selection of the vendor who we've selected to work with on administration of the endpoint and then it's all around the protocol, right? And again, this is where I think the fact that we've been doing this for 10 years. We've run lots of studies in this patient population, including 10-meter walk. I think that gives us confidence, and we're on top of the details. So yes, there's likely overlapping sites but different vendors and different protocol in terms of how that study is being monitored.

And then the NYHA Class, any color you can share across 2%, 3%...

No. I mean we haven't given any specifics on baseline. I mean when I talked about this split between hereditary and wild-type that was targeted. So I didn't give you the actual baseline statistics. So I don't have that data to share. The one thing that I would highlight, though, is there's certainly been some angst from some investors that if you're putting more type 1, type 2 patients, they are less severe patients, maybe that was the problem in the BridgeBio study. But if you look at the tafamidis, the ATTRACT data, the one -- the Class I, II patients actually performed at least at a similar level in terms of the decline, if not even more significantly than the Class III patients. And so I don't think that's the right concern based on that data. But I don't have the specifics on the split between Class I, Class II, Class III. We have -- we certainly have all 3 types of patients, but I don't have the specifics of the split.

Okay. And I think last time when I asked [indiscernible] tafamidis patient population. So I'm just wondering, at that time, I think as you said mid -- low single digit. So that's to maintain the same level or any change there?

It does, yes. So this is to sort of remind everybody what we've talked about in terms of tafamidis in both the APOLLO-B and the HELIOS-B study. So APOLLO-B at baseline was capped at 30%, and then we do allow drop-ins. The drop-in rate has been very low for both actually APOLLO-B and HELIOS-B. In terms of half at baseline, in HELIOS-B the initial cap was at 30%. We lifted that and had an internal target of no more than 50%, and actually ended up lower than the 50% target in HELIOS-B. But the drop-in rates in both studies in terms of patients initiated path has been very low.

Okay. That's interesting. HELIOS-B now increased to like the 30% [indiscernible]

Yes, We lifted the cap, but we did not get the 50%. We're well below that actually. Yes.

Okay. So I remember original study design was not powered to detect that is significant for the subgroup, like 30% or now may be close to 50%. Now since you over-enroll, do you think the study is sufficiently powered to be able to detect the differences the -- that is significant for the subgroup?

You're probably going beyond my ability to answer a question like that. I don't believe so. I don't think it's statistically powered to detect that kind of the difference. But certainly, we'll do subgroup analysis, and I think there'll be some interesting data there.

Okay. Okay. Very good. And the another -- kind of lost my track. Oh, okay. Yes. So the baseline, patient baseline, I don't know if you had a chance to look at it, how the patient baseline -- now -- when you look overall -- like all the baseline patient characteristics, how comparable that's to, say, BridgeBio study versus ATTRACT study?

Yes. Again, we have not disclosed any of the specific details about the baseline characteristics in the study. I walked you through some of the high level what we were targeting. And I think we're comfortable with where we've landed in terms of how we've enrolled that study, but we have not disclosed any of that, and we haven't done that historically on any of our studies.

Okay. Good. I know we don't have much time left, but just last question. How would you -- like what kind of different scenarios you think that will -- the APOLLO-B will have? And how would that lead to your decision for the HELIOS-B study?

Yes. So you're asking about the interim analysis that we've got an option on the HELIOS-B study. And we've always talked about the fact that the APOLLO-B readout is really going to be informative in terms of helping make that decision. So we've talked a lot about 6-minute walk. What we haven't talked about are some of the secondary endpoints in APOLLO-B, which include the CV hospitalizations and they all cause mortality, which is a secondary endpoint APOLLO-B. We're not powered statistically to show a difference there. But certainly, we think we're going to get some very interesting data. And that would then inform what we -- whether or not we move forward with an interim analysis on HELIOS-B, where the primary endpoint is they all cause mortality and the CV events. I think the one thing to keep in mind, however, is we actually enrolled HELIOS-B much faster than we anticipated. We completed enrollment in August of last year. We had expected actually that we would complete enrollment first half of this year. So that has -- also has an impact on this decision because the benefit of the interim analysis has become less as a result of the fact that we enrolled the study faster. And if we allow it to go through to completion, the timing benefit of running the interim analysis become less. So all of that will be sort of part of the calculus in terms of how we make that decision, but it will be post APOLLO-B.

I know we're running out of time. Thank you very much.

Thank you.

Thank you, everyone.