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

Good morning. My name is Ted Tenthoff. I'm a senior biotech analyst at Piper Sandler. And before I begin, I'm required to point out certain disclosures regarding the relationship between Piper and our next presenting company, Alnylam, which are posted at the back of the room and also at the registration desk. And that's a long time of disclosures. I remember doing the Alnylam IPO, it's one of the first ones that I did at Piper 20 years ago. So it really shows you the long relationship that we have with Alnylam. As you know, Alnylam is a leading developer of RNA therapeutics with a growing commercial business and a rich pipeline of future therapies. After a roller coaster review, the FDA issued a CRL for ONPATTRO in hereditary and wild-type ATTR amyloidosis with cardiomyopathy, sending Alnylam shares lower. But I really want to own Alnylam right now for AMVUTTRA growth in the upcoming Phase III HELIOS-B data in early next year, which are positive, would expand the label and make up for the revenues and I think the lost value from the ONPATTRO CRL. Here with us today is CEO, Yvonne Greenstreet. Yvonne, thanks always for being with us, especially during these exciting times for Alnylam.

It's such a pleasure to be here. And actually, it's wonderful to be in this hotel in New York in the festive season. It starts to get me thinking that the holidays are not far off.

It is a great time of the year to be in New York. That's true. So we're going to start the conversation with AMVUTTRA, but I'll be sure to save some time to focus on the pipeline at the end. So Yvonne, despite the CRL, you guys maintained product sales guidance of $1.2 billion to $1.285 billion this year, maybe at the lower end of the range. Growth has really been driven by quarterly subcu AMVUTTRA, which is both cannibalizing ONPATTRO, but also expanding the hATTR polyneuropathy franchise. What's driving this strong growth? And how large is that global polyneuropathy mixed phenotype market?

That's a great place to start. But maybe just before I answer your specific question around AMVUTTRA, just for those that may be new to the Alnylam story, just to make a few introductory remarks. As you mentioned, we are the leading RNAi company. We're incredibly pleased to have been able to deliver 5 RNAi therapeutics in about 4, 4.5 years, which I think is a remarkable achievement to deliver them to patients, not just patients with TTR amyloidosis, but also some ultra-rare diseases. And doing that as well as continuing to build a very rich pipeline of over a dozen clinical programs. And I think what's also very exciting about the company is our ability to keep sustaining innovation through our research engine with a plan to deliver a steady state or more INDs per year. So we think we really have a unique profile as a biotech company, are very excited about the future. Now specifically around AMVUTTRA, you're absolutely spot on. AMVUTTRA is a real growth driver for the company, for patients with hereditary amyloidosis, ATTR amyloidosis with polyneuropathy. And I think that the performance of AMVUTTRA has really been driven by its game-changing profile. What we've been able to demonstrate in clinical studies is a really rapid onset of action. So within the first 3 months of therapy, reducing TTR by 88%. And actually, even after just the single dose of AMVUTTRA demonstrating benefits on some clinical outcomes within the first month, notably mBMI, which I think is a good indicator of how patients feel. So rapid onset of action but also impact on polyneuropathy features. So nearly half of the patients that we studied in clinical trials actually reversed features, which is remarkable reverse features of polyneuropathy, which kind of in my history is very unusual for a neurological indication and also improvements in quality of life. And that's the second thing, the efficacy that we're seeing. I think the third point is around the very convenient regimen, which aligns with physician business. So administered every quarter, to subcutaneous injection. And as well as aligning with physician visits, I think there are some benefits with respect to access being a Part B drug and also with compliance. So I think there are a number of reasons why we're seeing such strong growth of AMVUTTRA. And it's a pretty sizable market, hATTR amyloidosis with polyneuropathy, probably about 50,000 patients worldwide and about 30,000, who've either got polyneuropathy or the mixed phenotype. I think what's interesting to me is that despite this really strong growth, which we're very, very pleased with, we're still very early in the opportunity here where we have about 3,800 patients treated with our TTR therapeutics at this point in time. You can see there's a lot that we can still go after with respect to polyneuropathy.

It's a really good point. And you're so right to remind us of the profound efficacy as these drugs reach the clinic or as they reach the market, sometimes we forget, but I don't think I'd ever seen that many 0s on a p-value when reported the AMVUTTRA data so it is remarkable to actually be able to reverse nerve function. Remind us about the upcoming HELIOS-B trial design. This is going to be a really important readout for Alnylam. When could we get that data? Why do you think this trial can succeed to expand the label?

Yes. So maybe to start off fine, just remind me everybody that we have a Phase III study called HELIOS-B that's ongoing, which is looking to expand the label for AMVUTTRA to address the needs of patients, not just the polyneuropathy but also with cardiomyopathy. And this takes us into a much, much bigger market. I spoke to 30,000-odd patients with polyneuropathy or mixed phenotype. You're really looking at 200,000 to 300,000 patients, who've either got -- already feel wild-type cardiomyopathy. So really are opening up to a much, much larger market. We are really confident in the design that we have -- so we have -- and actually, the execution of the HELIOS-B study. I think it's important to highlight that it's an outcome study. So we're looking -- so the primary end point is a composite of all sorts of mortality and the recurrent CV events. I think that's really important for both physicians and patients to be able to demonstrate an impact on symptomatology, but also on outcome. The other reason why we're very confident about the outcome of this study is, it's a large study, 665 patients, we actually overenrolled by 10%. We're also studying patients for actually the longest period of evaluation in any TTR study. We're studying patients out to 30 to 36 months, which I think is an important point to make. And when we designed the study, we also instituted an operational cap for patients on tafamidis, which is under 50%. And we've had low drop-ins of taf in the study well below our internal assumptions. So we feel that we're pretty well set up from the design and execution perspective to deliver successful study. And we're also really quite pleased with the data that you talked about, the CRL, but the data that we delivered with another RNAi therapeutic, the TTR, our first-generation molecule ONPATTRO in a study called APOLLO-B, where despite the fact that we received a CRL, actually was a positive study. And what's really exciting is that we've been able to look -- that was the study that delivered primary outcome -- primary endpoint at a year that we've been able to follow patients out now for 2 years. And what we've seen is if you follow patients for longer, you actually start to get real stabilization around the primary endpoint in that study 6-minute walk test, but also really encouraging trends with spec to mortality. This gives us a lot of confidence that actually by studying more patients for a longer period of time, will deliver a successful PTSD study. And maybe the final point to make is we obviously operated in this disease area with other players, the recent study readouts, acoramidis from BridgeBio, which showed that in a contemporaneous patient population where it's believed that the patients might be a bit milder, there's still an opportunity to demonstrate benefit of an efficacious therapeutic in this modern era. So we're really excited about moving forward the study, and we're looking forward to sharing results of the study in early 2024. Just to remind those of you that don't follow Alnylam, early 2024, Alnylam sounds a little bit like broad. So it actually means first or second quarter in 2024. But we can't wait for the readout of the study and sharing the results more broadly.

Yes, it's going to be very exciting. Now again, you laid out sort of why you think this can be a positive trial. If you succeed, how do you envision AMVUTTRA competing with oral tafamidis and the other stabilizers?

So let's just say the other stabilizes first. I think, obviously, tafamidis is being used widely now for patients with TTR cardiomyopathy. And despite treatment, it's clear that patients continue to progress. So I believe there's a real opportunity to introduce additional efficacious therapeutic into supporting patients with this disease. There's another stabilizer in development. I touched on in acoramidis from BridgeBio. And that's another stabilizer. So again, that will be a useful addition but really has a very similar mechanism of action. I think what we're looking to do with vutrisiran in patients with cardiomyopathy is bring -- seeking new mechanism of action with some of the features that I have already touched on in terms of levels of efficacy. And again, I think what's really important is our long track record in developing and commercializing TTR medicines with really a really robust safety database. We've launched ONPATTRO over 5 years ago now, and safeties that we've generated has been really quite robust. So we think that if we're able to deliver an outcome study from an outcomes endpoint in HELIOS-B study, will have a very, very competitive [indiscernible].

And you guys are going to host an R&D Day on December 13. So looking forward to that where maybe one of the things you'll be updating would be ALN-TTRsc04, which I believe has the potential of annual dosing. How important is patient convenience? And is there a risk of silencing transthyretin for that?

So ALN-TTRsc04 is based on what we call our IKARIA platform and the potential here, which we've demonstrated in NHP studies is, as you say, the opportunity for potential annual dosing, but also for higher levels of TTR knockdown. So we're looking at 90% or greater TTR knockdown, I think could be quite important from an efficacy perspective. The Phase I study is ongoing, and we hope to have results of that, that we will be able to share before the end of the year. What we're really looking for there is better understanding of potency durability, obviously, of course, safety. So we're really excited about this opportunity because it also, from an Alnylam perspective, I think just shows what our innovation engine. So we started off with ONPATTRO, which is a 3-weekly infusion. We improved that with our second-generation molecule, vutrisiran AMVUTTRA, which is quarterly subcutaneous and now we're able to enhance the profile of our approach to helping patients with TTR amyloidosis with this potential annual regimen. I think it's going to be great for patients that, once a year to be able to have an injection that's able to address.

Pretty incredible, yes. One of the big trends that we're really seeing is a move from orphan diseases to treat more common diseases I've been seeing the LEQVIO commercials now for hypercholesterolemia. Zilebesiran is, I think, a really exciting drug that fits this mold targets angiotensinogen for hypertension. Tell us about this therapy, why do you choose to partner that one with Roche now?

Yes. Again, I mean, taking a step back, I think it really shows the power of our platform. So we started off developing medicines for rare diseases. But if you look at what the potential of our technology can do, we talked about potency and durability. On the back of a robust database if you look at all of our programs, you can see how it makes a lot of sense actually to start to point our technology, not just the rare diseases, but to much larger diseases where we can have even greater impact on patients. I think this is something that is obviously very relevant to zilebesiran, but as we think about the future of what RNAi therapeutics can do, really opening up the aperture to a lot of diseases. I think it's something that's going to help fuel the growth of the company, I think, for decades to come. We're very excited about zilebesiran. Zilebesiran is really entering a disease area that really hasn't seen innovation for decades and there's a huge level of unmet medical need. You got over 219 million patients in the major markets who have hypertension, close to 80 million of those are high cardiovascular risk, 70% of them not compliant. So we really think there's an opportunity with zilebesiran to completely reimagine how hypertension is treated. So we are really excited about this model. We partnered with Roche because for a large disease like this, it makes sense to work with a larger pharma company that's got the resources to bring to bear both to drive development. We're looking at doing cardiovascular outcome studies as well as ensure successful commercialization. And partnering with another company also it gives us even more opportunity to continue to invest in all the other exciting opportunities that we have in our pipeline. Maybe we'll touch on some of those later. And I think it was really smart to partner with large company at this stage for zilebesiran's development. And we decided to partner with Roche because they have a common vision around how they see the potential of zilebesiran in hypertension. And they've actually got really successful, really having a global commercial footprint. They've got a really successful track record in driving innovation in markets. And we're very excited to be working with them and look forward to continuing to move forward the program.

So we just got, I think, monotherapy data was presented at AHA, we're going to get KARDIA-2 data, which is on top of standard of care early next year. How do you -- you mentioned about a shared vision of development. How do you guys see developing this?

Yes. So just to kind of set the table, if you like. So you touched on KARDIA-1, which is a monotherapy study, and we presented those results at the AHA, and they were actually fantastic. I mean essentially with achieving reductions of systolic blood pressure of around about 50 millimeters of mercury at the kind of every dose and every regimen kind of out to 6 months. So the profile of zilebesiran looks to be really promising, but that was zilebesiran as monotherapy. KARDIA-2 is looking at zilebesiran on top of 3 classes of drugs. So on top of either a diuretics, a calcium channel blocker or an arm. We think this is really important to here replicate what we've seen in the Phase I study, which is that adding zilebesiran on top of these agents provides additive efficacy but also with most safety penalty. So this is a really important study for us, and we'll be looking to share those results in early 2024. And the third Phase II study we're doing is called KARDIA-3, really, what this is looking at is, is slightly different patient population. So they're at higher cardiovascular risk on top of 2 or more antihypertensive. And the importance of this study is to really understand this patient population and to derisk what the patient population that we study in a larger outcome study. And so this is the work that we're doing together with Roche and we are looking forward to updating on the program.

Yes, I'm really looking forward to that data in that program advanced I mean, that could be a company in itself, for example.

Absolutely. Absolutely.

Now Alnylam has a strong RNAi discovery alliance with Regeneron, I think, really super innovative. And perhaps we can start describing some of that and how the alliance works. So one, lead, I think, the lead program coming out of that is ALN-APP, which is really, really interesting for both early onset Alzheimer's disease. Maybe you can describe when RNAi mechanism may prove superior to antibodies. And what does that development path look like from here?

So again, just to provide some context, ALN-APP is the RNAi therapeutic that we are developing, both early onset Alzheimer's, we didn't have plans also develop the cerebral amyloid angiopathy, which I think is a really interesting indication. It's really impressive that we've been able to show the first human translation of RNAi therapeutics in the CNS. We delivered a really strong Phase I data. So we're able to show reductions in SACP alpha and beta, 84%, 90% with a single intrathecal dose. And so this really allows us to start to move forward into the second part of the study, part B, where we're looking at multiple ascending doses. And that study is continuing to move forward. We are under a partial clinical hold in the U.S. that we have been working with the FDA to overcome, but we have the green light to proceed from a number of other regulatory authorities. So we're continuing to move forward that program. And we -- obviously, as we get better idea of results from the Part B, we'll be able to refine dose and duration and those sorts of things and move into trying to deliver clinical outcomes and meet goals.

Yes. Really exciting. And definitely, I think, could highlight the unique mechanism of RNAi versus antibody.

Yes, I mean so you're spot on and I think one of the, I think, key points to highlight around the RNAi approach, which contrasts with the antibodies approach. I mean, first to say that actually we're delighted with the progress of monoclonal antibodies in terms of making an impact on patients with Alzheimer's so modest, and we think we can do better because we're acting upstream of amyloid precursor protein and impact all of the high isoforms whereas the antibodies, it could only impact select isoforms. And we're also able to, as you know, act not just in the cells, but also outside the cells. We think there's some opportunities of differentiation, which we believe could lead to better efficacy for patients.

So Yvonne, I'll ask you this question. Where do you see Alnylam and RNAi going over the next 2 decades. So the first 2 decades have gotten us here, commercial franchise, exciting pipeline. What are you really looking forward that's going to be exciting over the next 10-plus years?

Well, we feel that with what have in our hands and I touched on at the beginning, growing revenues in our commercial portfolio, rich clinical pipeline, this important kind of innovation engine that we will be able to build a top-tier biotech company. We've committed to achieving profitability. We've shared some goals a couple of years ago, which you call P5x25, which really sets out the course for us to be able to be self-sustainable and profitable by the end of 2025 as well as continuing to invest in all these exciting programs in our pipeline. The other thing to touch on is that from a scientific perspective, we really feel that we've only started to scratch the surface of this technology. Obviously, got programs that are based on our liver-targeted delivery but now in to CNS that we've just discussed, we're not just focusing on rare diseases, but we can also look to address some of these and prevalent diseases. We're going to open up extrahepatic tissues in addition. You'll hear more in R&D day, some of the progress that we're making in this regard. But really, it's just a technology that can work in every single tissue in the body. So I think we've really only just kind of begun the journey and there's just so much more excitement ahead of us, specifically focused on the [indiscernible].

I'll just pause and see if there's any questions for the audience. But that's a perfect spot to end this conversation. I always appreciate seeing you. I'm really excited for the HELIOS data for the R&D Day in just a couple of weeks for the HELIOS data in early 2024 -- in first half of 2024 and the progress coming both on the commercial side and the pipeline. Thanks for being with us. Thanks, everybody.