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

Ladies and gentlemen, thank you for standing by. Welcome to the Alnylam Pharmaceuticals conference call to discuss strategic financing collaboration with Blackstone. There will be a question-and-answer session to follow. Please be advised that this call is being taped at the company's request. I would now like to turn the call over to the company.

Good morning. I'm Christine Lindenboom, Senior Vice President of Investor Relations and Corporate Communications at Alnylam. With me today on the phone are John Maraganore, Chief Executive Officer; Yvonne Greenstreet, Chief Operating Officer; and Jeff Poulton, Chief Financial Officer. Barry Greene, President; and Akshay Vaishnaw, President of R&D, are also on the line and available for Q&A. For those of you participating via conference call, the accompanying slides can be accessed by going to the Events section of the Investors page of our website, investors.alnylam.com/events. During today's call, as outlined on Slide 2, John will provide some introductory remarks and provide some general context on our newly announced financing arrangement with Blackstone, Yvonne will describe the structure of the deal and Jeff will review what this financing means for our path towards self-sustainability before opening the call to your questions. I would like to remind you that this call will contain remarks concerning Alnylam's future expectations, plans and prospects, which constitute forward-looking statements for the purposes of the safe harbor provision 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 those discussed in our most recently annual report on file with the SEC. In addition, any forward-looking statements represent our views only as of the date of this recording and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update such statements. With that, I would now like to turn the call over to John.

Thanks, Christine, and good morning, everyone, and thank you all for joining us today. First off, I want to start by expressing my hope that all of you and your families are safe and healthy during this unprecedented time. It goes without saying that nothing is more important than your health and well-being. Now turning to our news. We are thrilled today to be entering into a landmark financing arrangement led by Blackstone Life Sciences worth $2 billion, one of the largest ever financing arrangements in biotech history and in fact the largest ever for a pre-profitable company. Yvonne will get into more details of the financing agreement in just a moment, but let me start by providing some initial context on what this deal means for Alnylam and our ability to continue to advance RNAi therapeutics as a whole new class of innovative medicines. This new relationship with Blackstone provides Alnylam with very significant capital that we believe secures our bridge towards achieving a self-sustainable financial profile without the need to access the equity markets in the future. With this strengthened cash position along with multiple drivers of top line revenue, we believe that we can build a top-tier biopharmaceutical company focused on advancing medicines with transformative potential to patients around the world. This exciting multicomponent deal is anchored on Blackstone's purchase of 50% of our royalty on inclisiran, an investigational RNAi therapeutic for the treatment of hypercholesterolemia, which, as you know, is currently under review by the U.S. and European regulators and, if approved, will be commercialized by Novartis. We believe inclisiran, which was invented by Alnylam scientists, holds enormous promise as a potential game-changer in hypercholesterolemia management. Accordingly, our retention of a full 50% of the royalties allows us to retain significant financial benefit from the drug's potential commercial success. Of note, the $1 billion to be paid for the 50% royalty share is also the largest ever royalty monetization of a product prior to its approval and the third largest partial monetization ever. Finally, we view Blackstone as one of the world's leading private equity firms as a high-quality partner for this type of transaction as they share our commitment to creating significant value through the advancement of innovative medicines. In addition to the royalty transaction, Blackstone's $750 million debt facility, $150 million of proposed R&D partnership and a $100 million stock purchase demonstrate the firm's commitment to our future and alignment with our long-term vision. Now before I hand it over to Yvonne, let me just briefly touch on Alnylam's business continuity efforts during the COVID-19 pandemic. Our focus, of course, on today's call is on our new strategic financing arrangement with Blackstone, but I do invite you to read the statement on Alnylam's response to COVID-19 on our website. We plan to provide further updates on COVID-19 on our first quarter results conference call and thereafter at our quarterly conference calls. With that, let me turn it over to Yvonne. Yvonne?

Thanks, John, and good morning, everyone. I'm very pleased to share with you this morning the details of this exciting new collaboration that we forged with Blackstone. The deal consists of 4 separate components: first, monetization of the inclisiran royalty; second, corporate debt; third, an agreement in principle around an R&D partnership, whereby Blackstone would fund certain activities related to the clinical development of 2 cardiovascular disease programs; and fourth, a purchase of Alnylam equity. The aggregate proceeds from these 4 components totals $2 billion. Let me begin with the royalty monetization. Blackstone is purchasing 50% of any royalties paid to us by Novartis on the global sales of inclisiran. Per our agreement with Novartis, assuming approval, we are eligible to receive tiered double-digit royalties up to 20% on global inclisiran sales, which we expect to average in the high teens. And 50% of that royalty stream will now flow to Blackstone, while we continue to book 100% of the inclisiran royalties as revenue. For this component of the deal, Blackstone will pay $1 billion, broken up into 2 equal payments of $500 million, the first of which we received at the closing and the second payment occurring on September 30, 2021. Importantly, the second $500 million payment is time-based and not contingent on achievement of any specific event. In the unexpected case that Blackstone does not receive $1 billion in total proceeds from inclisiran royalties for the period through the end of 2029, Blackstone's share of the royalty will increase to 55% beginning in 2030. In addition, Blackstone will be eligible to receive a portion of inclisiran milestone payments. Specifically, and as you may recall, Alnylam is eligible to receive up to $150 million in milestone payments from Novartis, comprised of $50 million in regulatory milestones and $100 million in commercial milestones. Under the Blackstone collaboration, Alnylam retains 100% of the remaining $50 million in regulatory milestones and 25% of any commercial milestones achieved. Blackstone will receive the remaining 75% of the $100 million in commercial milestones, if achieved following regulatory approval. Again, the accounting treatment for this transaction will allow Alnylam to recognize 100% of the value of royalty revenues received from Novartis on future inclisiran sales. The second component of the deal consists of a $750 million senior secured term loan facility in agreement with GSO, the credit arm of Blackstone. Under the terms and conditions of the credit agreement, Alnylam will have access to facility via 3 draws: $200 million by December 31, 2020; $250 million by June 30, 2021; and $300 million by December 31, 2021, subject to customary drawdown conditions. At our election, we can choose to not draw up to $150 million of the debt in the facility, providing added flexibility to match the cash needs of our business. The interest rate under the facility is LIBOR plus 7%, with the exception of $50 million in the final draw, which is uncommitted with terms to be consented by GSO, and the facility will mature 7 years from the first draw. We believe that these are attractive corporate debt terms, particularly in light of current market conditions. The third component of the deal, for which the parties have agreed to nonbinding terms, is a potential R&D partnership, whereby Blackstone would provide up to $150 million in funding for the clinical advancement of 2 cardiovascular disease programs. Specifically, the terms contemplate Blackstone paying up to $70 million to support funding of the HELIOS-B Phase III study of vutrisiran in ATTR amyloidosis patients with cardiomyopathy. Further, Blackstone would pay up to $80 million to support funding for clinical advancement of ALN-AGT, an investigational RNAi therapeutic targeting angiotensin for the treatment of hypertension. Specifically, this funding would help support advancement of a Phase II as well as a Phase III study of ALN-AGT. Alnylam would be obliged to pay Blackstone fixed payments over 2 to 4 years following achievements of developments and regulatory milestones in the vutrisiran and ALN-AGT programs. In addition, the time sheet contemplates Alnylam paying a 1% royalty on worldwide sales of vutrisiran per defined royalty term following regulatory approval in ATTR cardiomyopathy. We would not owe any royalties to Blackstone on sales of ALN-AGT. For Alnylam, this potential $150 million R&D partnership would provide meaningful funding during the next 3- to 4-year period as Alnylam approaches its self-sustainable financial profile. The last component of the deal is $100 million equity investment by Blackstone in Alnylam common stock. Alnylam is issuing to Blackstone purchases 963,486 shares, which represents less than 1% of issued and outstanding shares at a price of $103.79 per share. The share price was determined by calculating the volume-weighted average price, or VWAP, over the 30-day period ending on April 9, the last trading day before signing. A 30-day VWAP mechanism is a conventional approach for share price determination in these types of transactions and was agreed to nearly a month ago without visibility on how the overall market and Alnylam share price would fare during this very volatile period. Blackstone now becomes a meaningful Alnylam shareholder providing them fair opportunity to benefit from Alnylam's future success. In this regard, we are pleased to have Blackstone's share a commitment to Alnylam's long-term vision and be aligned with our plans to create shareholder value. I will now turn it over to Jeff to provide some additional perspective. Jeff?

Thanks, Yvonne. Good morning, everyone. Let me provide some color on how this financing helps secure our bridge towards achieving a self-sustainable financial profile with independence from the equity markets. As we've said before, self-sustainability is a top priority for us and one that we feel is very appropriate given our evolution from an R&D-only company 2 years ago into one that now has 2 commercial products and several more that are approaching commercialization in the next few years. At our R&D Day in November, I highlighted how we have 2 key levers affecting our path to self-sustainability. First one is top line revenue growth. We have about 1.5 years of ONPATTRO commercialization under our belt, and we're in the very early days of the GIVLAARI launch. If we fast forward to 2025, if all goes according to plan, we would have up to 6 additional revenue drivers in the market over that period, which would include 2 additional new products that Alnylam could be launching, 2 potential label expansions and 2 potential royalty streams from products launched by our partners at Novartis and Sanofi. The second lever that I talked about is disciplined and leveraged investment, specifically how we invest in our operations and allocate capital across our portfolio. On the R&D side, much of that investment today is across our late-stage programs, where we expect a high return on investment. And on the SG&A side, we have built significant infrastructure over the past 1.5 years, initially to support the launch of ONPATTRO, which is now providing operating leverage as we launch GIVLAARI and continue to advance additional products to the market to grow the top line. It is important to emphasize that our disciplined approach to managing our operating expenses will not change as a result of today's $2 billion financing. This financing will not result in an increase to our previously planned spending levels and, as such, disciplined spending will continue to be an important lever on our path to achieving a sustainable financial profile. As you know, we ended 2019 with $1.55 billion in cash. While this provided a multiyear runway based on our current operating plans, it was not sufficient to get us to self-sustainability without the potential need for dilutive financings. Having now entered this $2 billion strategic financing arrangement with Blackstone, we believe we can achieve self-sustainability without any need to access the equity markets in the future. We believe this equity market independence places Alnylam in a unique position to build a top 5 biopharma company and create strong value for our shareholders. And with that, let me turn it back to Christine to open it up for Q&A. Christine?

Thanks, Jeff. Operator, we will now open the call for questions. [Operator Instructions]

[Operator Instructions] We will take our first question from David Lebowitz with Morgan Stanley.

When it comes to the accounting for this, should we assume, I guess, 100% of the royalties booked under revenue and then the payments to Blackstone will be under cost of goods sold?

Let me -- thanks, Dave, for the question. Let me hand that right over to Jeff. Jeff, you got it.

Dave, thanks. Yes. So the cash received from the royalty monetization will impact our balance sheet as an increase to cash and an increase in a debt-like liability payable to Blackstone. We'll start recording noncash interest expense on that liability balance each reporting period going forward, including Q2, will be the first time we'll see that. Then when Novartis launches inclisiran, assuming regulatory approval and begins generating sales, we would book 100% of the royalty from inclisiran as royalty revenue on our P&L. We would then remit to Blackstone their 50% of the royalty and record a reduction of the liability from our balance sheet. So it works similar to a pay down of debt -- of a loan. So again, impact on our P&L is we would have 100% of the royalty revenue that we would book, and we would have noncash interest expense that would also be hitting our P&L.

And with respect to ALN-AGT, why is it that they are, I guess, making a payment on the development on that end but also not taking a royalty while they are making a payment for inclisiran but are taking a royalty in that area?

Yes. Let me start and then maybe Yvonne can comment. Obviously, the $150 million structured R&D financing arrangement that's part of this deal is very typical of these types of structured R&D funding arrangements that you can find in the marketplace out there with investors. And it was engineered with an overall view of providing them a return based on success of the programs, of course, but also providing us with the R&D funding in the meantime. So all of these different components got into the mix, if you will, Dave, of negotiation. And that's where we ended up with a very small royalty on vutrisiran that has a time limit to it and then cash payments on ALN-AGT when it reaches the market. Yvonne, do you want to add anything more to that?

Yes. I think just to note that wild-type ATTR is a very large market opportunity, and we think that vutrisiran has substantial potential here. And hypertension is also a large market opportunity. So the opportunity to obtain financing now with a total payback amount that's only a very small proportion of expected future sales of these products, we think, is a very attractive part of this financing facility.

We'll take our next question from Gena Wang with Barclays.

Congrats on the deal. First question is regarding asset timing for closing of the transaction, if you can provide a little bit more color on that. And the second related question is the $1 billion proceeds, any impact from FDA and EMA approval timing as well as label?

Yes. Let me start with the second question real quickly first. And then, Jeff, you can talk about the first one. Gena, there is no element of the approval or timing of the approval for inclisiran in terms of receiving the $1 billion, the $500 million which has been received already and then the $500 million that's received in September of 2021. So there's absolutely no contingency around its approval. If the drug never gets approved, the payments still take place. That's incredibly unlikely, of course. But even the timing of FDA or EMA approval are completely unrelated to when we receive those payments. Jeff, do you want to deal with the accounting question?

So Gena, could you repeat that -- the first question. I thought it was around the close. Can you help me with that again?

Yes. Sure. So what is your estimated timing for closing of the transaction?

Okay. The transaction closed on Friday, Gena. So it's already closed.

Okay. So which means you already received $500 million, the initial one?

$600 million. So we got the $500 million initial royalty payment and $100 million in equity as well.

We'll take our next question from Maurice Raycroft with Jefferies.

Congrats on the update today. First one is just on additional plans for the rest of the inclisiran royalty. I guess do you plan on monetizing that? Or do you plan on keeping that royalty as is?

Yes. Maurice, thanks for your comments at the beginning. Well, we believe in inclisiran's potential, and one of the things about this deal with Blackstone that we find very attractive is that we've retained 50% of the royalty. And so for us, that represents an ability to realize the upside of the product while we've been able to monetize half of it to generate the $1 billion of the $2 billion in this financing arrangement overall. So we thought that was -- and we talked about this a little bit over the last several months as people were asking us about monetization of inclisiran. We were pretty clear that we really do believe in the upside of the product and so we do like the concept of retaining the portion that we've retained. Yvonne, do you want to comment any further on that?

No. I think you've covered it, John.

Got it. And just a quick one on the payments -- the fixed payments to Blackstone over the next 2 to 4 years following achievement of certain development and regulatory milestones, can you go into more specifics on what that entails?

Sure. Yvonne, do you want to cover that? That relates to the structured financing on the R&D programs. Do you want to cover that, Yvonne?

Yes. No. So we're -- we have a nonbinding term sheet and obviously, we're going to be negotiating details of the agreement over the next several months, then we'll obviously come back and share with you more details as we do this. Essentially, the structure is that as we achieve some specified milestones, we'd owe fixed payments, equaling a certain multiple of invested capital for ALN-AGT and vutrisiran. And for vutrisiran, we would also fix payments plus a 1% royalty on worldwide sales for a specified period following approval. But beyond that, we're not in a position to discuss details.

We'll take our next question from Alethia Young with Cantor Fitzgerald.

Congrats on the deal. It's very, very interesting. So I guess -- yes, it's awesome. So maybe 1.5. Can you talk a little bit about how Blackstone perceive the value of inclisiran maybe in addition to what Novartis did, like kind of how they think about the peak potential of this drug? And then the other part is just, I guess, maybe just talk a little bit broadly about why Blackstone and why the many components and you think they're the right kind of people to move forward with on this type of deal.

Yes. Well, let me maybe cover both of those questions. Then Yvonne, I'd love you to jump in as well. Obviously, we didn't sit down with Blackstone and share each other's models on inclisiran sales potential because that would be -- that's something that we were negotiating with each other. But you can see by the amount that they're investing for 50% of the royalties that they, like us, believe that inclisiran will have multibillion-dollar potential. And we're not the only 2 that view that. Obviously, Novartis has the same view, which is why they bought the Medicines Company for what they bought the Medicines Company for. So I think it just really relates to our confidence around the product and their confidence around the product. The second part of your question on Blackstone is I think it's hard to think of a stronger, more well-regarded private equity firm now committed to the life sciences than Blackstone. They've made a big push into the life sciences sector. They bought Clarus Ventures a few -- a couple of years ago, maybe a year ago or so. And they are really eager to basically put their capital to work for the right type of company, and they viewed Alnylam as very much the right type of company that is really an emerging commercial -- profitable, rather, company that within a very short period of time, they believe, and we believe as well, can become a top 5 biopharma. And that's what they're investing in. That's what we're committed to as well. And that's why they put their money behind our company. But of course, the name and the reputation, the quality of the name, I think, speaks for itself. Yvonne, do you want to comment any further on those 2 questions?

Yes. I think just to add that this is a competitive process. I mean clearly, inclisiran is a very attractive program. And so we assessed a number of royalty monetization and financing alternatives before proceeding with Blackstone. We're actually delighted to be working with Blackstone. They're very aligned with our ambition of building the business. And I think they bring that long-term perspective to bear, so we're delighted to have them as partners in this.

We'll take our next question from Do Kim with BMO Capital Markets.

Great. And congrats on the deal. Maybe if you could talk about the decision on the timing of this deal and the financing, why now versus potentially later in less disruptive times?

Well, thanks, Do. Look, I mean, we started discussions, as Yvonne said, it was a competitive process, at the beginning of this year around royalty monetization, actually end of last year, beginning of this year around the royalty monetization for inclisiran. And we obviously very much believe that this is a good time to explore that opportunity, and we went to the market looking for potential interest. There was a very strong level of interest across a large number of parties. And during February, and even at the beginning of March, we're negotiating with several different parties with very, very attractive deals. So the fact that we were able to pull this deal together in this incredibly volatile environment, I think, speaks to the quality of the assets including I think the opportunity that Alnylam represents for a firm like Blackstone. And it's our belief that this is a fantastic financing by all accounts. And why not do it now when it's at the beginning of a period where there might be more uncertainty and volatility in the equity markets. This seems like a really good time to do something like this, Do, from our build-the-company perspective. Yvonne, do you want to add anything to that?

No. I think you've covered it well, John.

Great. And one quick clarifying question. The royalty for vutrisiran is on approval in cardiomyopathy. So that -- if it's approved for polyneuropathy first, there is no royalty and then they get a 1% on total revenues after the cardiomyopathy approval. Is that correct?

That's right. That's right, Do. You got it spot on. Perfect.

We'll take our next question from Ritu Baral with Cowen.

One quick housekeeping question and then a real question. Any financial covenants associated with the debt facility? And two, you mentioned that the royalty increases if you don't reach the $1 billion by 2029. Do the milestones from Novartis potentially count towards that $1 billion?

Yes. Great questions, Ritu. Let me have the first one by Jeff and the second one by Yvonne. So Jeff?

Yes, Ritu. The only financial covenant associated with the debt facility is a minimum liquidity covenant that we'd have to have at least $100 million of cash on our balance sheet. So pretty straightforward.

And Yvonne, do you want to cover the second question?

Yes. I mean this was a negotiated term that gives Blackstone some downside protection if inclisiran doesn't meet its expected sales levels. But we fully expect inclisiran to generate meaningful royalties and for Blackstone to receive their $1 billion in royalties by the end of 2029.

And I think Ritu was asking whether or not the milestones count in that, Yvonne, and the answer is no. They're not included in that calculation.

Correct. We get the milestones, as I discussed, 100% of the regulatory milestones and 25% of the commercial milestones.

Perfect. And can you tell us -- John, you alluded to this in your opening remarks, but can you tell us what you're seeing right now just as far as the impact of COVID, both on ONPATTRO, which is an IV therapy, and the ongoing HELIOS studies and the APOLLO-B studies? Anything high level before we get to the earnings call?

Yes. I mean look, I mean, we absolutely are, as many companies are at this point, doing a lot to assess this. It's a very dynamic period as you all know. Our field teams have moved largely to being virtual in most parts of the world. There are some exceptions to that, like in Japan, where we still are having direct AGT engagements. And we're obviously going to report our Q1 in just a few weeks, so I think it's appropriate to obviously wait until that call. But we exited Q4 of last year with a very strong track record, and we're pleased with how our teams have been performing. And so obviously, we'll look forward to reporting in Q1. We've said on supply chain that there really have not been any issues. On clinical trials, we're still enrolling in all of our clinical trials, including our APOLLO-B and our HELIOS-B studies, our so-called Cardi B studies. And we probably will see some slowdown in enrollment during this period of time. But we are still -- these are global studies, and we are still enrolling patients in parts of the world, which are on the other side of the pandemic peak. So we are doing everything we can to keep things going according to plan. And we'll obviously do everything we can as we get to the other side of the pandemic to mitigate any potential delays that have happened. I don't know. Akshay Vaishnaw, if you're on the phone, do you want to comment any further on the clinical trial side as well?

No. I think you covered it, John. As you said, we have a global footprint with hundreds of sites active. And there are always a good proportion of sites that are still active despite this enormous challenge we're facing. It's a fluid situation. We've got a dynamic plan, and we're working to it. But we're doing the best possible under the circumstances so far as you said.

Yes. And Barry, do you want to comment anything on either the supply chain or the commercial side of it for Ritu?

John, the only thing I'd add is that we're delighted that payers in the United States and in many countries across the world have pivoted to allow home infusion. So we've seen a great number of patients move from academic infusion centers to alternative sites of care, local infusion centers or home infusion, which is ONPATTRO. Of course, GIVLAARI offers a lot of flexibility on sites of care.

Yes. That's great. So Ritu, does that answer your question there?

And I look forward to more of an update on earnings, but that's helpful.

Absolutely.

We'll take our next question from Paul Matteis with Stifel.

Great. On AGT, I think you guys had guided to having proof-of-concept data later this year. I just wanted to clarify if within COVID that's still on track and what that data might entail. And then second, maybe you can just comment on when your target for attaining full enrollment on APOLLO-B has been pre this crisis and your current feelings on whether or not that target is still realistic, understanding again that it's a dynamic time.

Yes. Thanks, Paul. So let me make a few comments and then maybe Akshay would want to jump in. For ALN-AGT, yes, we're very much on track to report our results in our clinical study. We'll obviously report safety. We'll report knockdown of AGT, which we can measure in serum samples. We'll also look and see if there's any impact on blood pressure. And again, I think like as a monotherapy to show a reduction in blood pressure of 5-millimeter mercury or anything above that would be amazing, would just obviously be very, very encouraging for that program as we start Phase II. So that is very much on track, and we plan on having that certainly this year. And then as it relates to APOLLO-B, before I hand it over to Akshay for any comments on this, look, our goal has been to complete enrollment by the end of the year. That's the goal that we put forward in our -- at our R&D Day and at JPMorgan earlier this year. If we update goals, we'll be doing it at our quarterly calls. We won't be doing them in between. And obviously, we're working very hard on that study. But as I said earlier, enrollment in studies is going to be impacted during this period, and we're doing everything we can to mitigate it. But if there's any change to that specific goal, we'll make note of that in our Q1 call in just a couple of weeks. Akshay, do you want to comment any further on either of those 2 questions?

No. I think you covered it, John. Thank you.

Congratulations, guys.

Thanks, Paul.

We'll take our next question from Whitney Ijem with Guggenheim.

I'll add my congrats. Just a quick follow-up on AGT. Yes. I guess does the infusion of capital kind of change strategically how you're thinking about this asset or next steps or time lines at all?

Yes. No, it's a great question. I think the simple answer is our plans are unaltered because of the additional capital. Obviously, the fact that there is funding that comes through the structured R&D financing vehicle helps us as a broader company from the standpoint of getting from here to profitability without -- with a very strong financial position without the need for future equity financings, and it was one part of the overall picture. But it doesn't really fundamentally change how we were planning to invest in that asset. It just means that for the totality of the package that we just secured with Blackstone that there's not going to be a need for any future financing as a company because we've now secured that for the future of our business. So I think there's really nothing else that's going to change at all on AGT. We're very excited about the program and look forward to bringing that important medicine to patients around the world. I don't know. Jeff, did you want to comment any further on that from a company profile perspective?

Yes. I mean I'll just reiterate one thing you said and something I said in my prepared remarks. We don't anticipate that, going forward, that this is going to change anything in terms of our future spending plans. We continue to believe that 2019 will be our peak net operating loss year, and we're now on this journey towards being a self-sustainable company. And with this financing, it allows us to do that in a way that we're not going to need to tap the equity markets again.

John, perhaps I can just add with respect to AGT that whilst we have a governance team with Blackstone, obviously, Alnylam will retain all the decision making and operational control for both AGT and vutrisiran.

Yes. Absolutely.

We'll take our next question from Anupam Rama with JPMorgan.

This is Tessa Romero on the call this morning for Anupam. Just a clarification question from us. What is the time period for which vutrisiran royalties will be owed following approval?

Yes. Absolutely. That's still being -- that's still part of the agreement that will be negotiated is -- and so we can't comment on that right now, and we don't yet have that finalized yet. So that will be something that will be negotiated as part of the final agreement for the structured financing -- structured R&D financing part of the deal. That's the $150 million component of the deal.

We'll take our next question from Mani Foroohar with SVB Leerink.

Congratulations, especially to Jeff for getting this closed on Friday. So only Josh's weekend was ruined. A couple of quick details on this one. First of all, congratulations on raising debt at possibly the best time in the entire economic cycle. When I look at the potential R&D funding, obviously HELIOS-B has already started. You guys have been talking a lot about how quickly you're moving ahead with ALN-AGT. As that deal continues to get negotiated and you see more clarity on the TTR cardiomyopathy market, do you have the option to not move forward with that structured R&D portion of the transaction given your access to so much equity and debt capital elsewhere in the deal?

Yes. No, it's a great question, and Yvonne should comment in a minute. But let me just say overall, I mean it's -- right now, we have a nonbinding term sheet with Blackstone on that part of the deal. But our intent is to enter into that part of the deal because we think it's attractive financing for the company with very favorable terms that are completely pay back on success. Now we expect success to happen with a high probability. It still is very attractive. Yvonne, do you want to comment any further on that?

No. You covered it nicely, John.

Great. And as a quick follow-up, is there a lockup period for the $100 million equity investment at all?

So Jeff, do you want to cover that?

Yes. Sure. We're not going to disclose the specific detail on that, Mani, but we do expect that Blackstone will be long-term holders of the equity.

We'll take our next question from Salveen Richter with Goldman Sachs.

This is Andrea on for Salveen. Maybe just one more with respect to the R&D partnership. Can you provide additional color on how those programs were decided to be part of the transaction and maybe how Blackstone viewed those particular assets?

Sure. Let me give a high-level perspective and then Yvonne can jump in. I mean Blackstone was quite excited about the cardiometabolic opportunities that Alnylam has been investing in, including inclisiran, and also the prospects for vutrisiran in the wild-type ATTR market as well as the prospects for ALN-AGT in hypertension. And so the discussions really coalesced around these cardiovascular programs and their potential in these large chronic prevalent disease markets. Very much as inclisiran has paved the way for RNAi therapeutics into these large market opportunities, Blackstone was quite excited about the large market opportunities with ALN-AGT and also with vutrisiran and wild-type ATTR. And as you know, that interest on their side converge very much with the fact that those are products where there's more significant R&D investment required to bring them to market. So having additional funding in those type of products given that there are larger market opportunities was attractive to us as well. Yvonne, anything else to add?

No. Nothing else to add, John.

We'll take our next question from Navin Jacob with UBS.

Can you hear me okay?

Yes. Hear you just fine.

Perfect. It's Navin from UBS. So given -- by the way, congrats on the deal. But given your very strong cardiovascular franchise and the increasing risk associated or knowledge of the risk of cardiovascular disease as it relates to COVID and even the late-stage portion of COVID that seems to have a cardiometabolic component to it, I'm wondering if any of your assets you're looking into studying it in late-stage COVID patients, whether it's ALN-AGT, whether it's some of the TTR products. Obviously, those are specific to patients that have TTR amyloidosis. But just given your experience out there, would love any color there.

Well, Navin, it's a really interesting question. Let me just -- I'm going to have Akshay answer it, but let me just start by reminding you also that one of the things that we are doing is advancing RNAi therapeutic programs toward SARS-CoV-2 directly. It's an RNA virus, and so we are advancing sRNAs towards the virus itself as well as more recently, we announced some host factor programs targeting ACE2, TMPRSS2 and potentially additional host factors as well. So that is our sort of direct effort on COVID. But your question is very interesting, and let me throw it over to Akshay to comment on it further. Akshay?

Yes. John, can we just clarify the question? Was it -- does ALN-AGT have a role in the management of the late stages of COVID or to do with the safety of ALN-AGT?

I think the management.

No. For the management. Yes, exactly. It's the [ first ] obviously of your program but -- sorry go ahead.

Yes. Interesting question. I think couple of things. We know that hypertension is a risk factor for poor outcome in COVID. That's been shown over and over again. That has to be approached in 2 ways. One is obviously, good management of hypertension should be maintained in all patients at all times, especially in this environment if it's such an important co-factor for poor outcome. So in that sense, I think drugs like ALN-AGT will have a role. Obviously, it's not an approved drug, but it could have a role in the future. The other perspective has been that drugs that act on the renin–angiotensin system may somehow alter ACE2 levels, which is the critical cell surface receptor for uptake of COVID. And so from a safety perspective, is it okay to administer RAAS inhibitors? And ALN-AGT would fall into that kind of category. And after the initial flurry of conversations around that more recently, all the major cardiology societies and aficionados on hypertension reinforce that there's no definitive evidence of a safety risk. And moreover, there may be some protective effects from ACE2 in the lung damage and potentially the cardiovascular damage with COVID. So I think ALN-AGT has the opportunity to be a great antihypertensive agent. Hypertension management is very important in COVID. There may be downstream benefits on levels of ACE2 or the biochemistry of that pathway that we don't fully understand yet. But I'm being speculative here. We don't see any downside risk at this point at all.

Great. Thanks, Akshay. Does that answer your question, Navin?

It does.

We'll take our next question from Leland Gershell with Oppenheimer.

This is -- I'll add my congratulations on this great deal. I just wanted to ask kind of an accounting question on the $150 million in potential R&D funding. I know that's yet to be completely finalized but should we take those $70 million and $80 million for the 2 respective assets to approximate what the remaining development costs are for those programs? Or would those be additive to any expected contribution from Alnylam in terms of the R&D spend? And then I've got a follow-up.

Yes. Jeff, do you want to handle that?

Yes. Let me just give you the summary of what we understand right now and how the deal would be accounted for, right? And again, we can update this when it's finalized. But right now, we anticipate that the way that the deal will be structured, the $150 million of funding that we would get from Blackstone would be -- we would book the full R&D expense associated with this program. So it would not sort of come off our P&L that $150 million portion that they would be funding. I hope that answers your question.

And I think maybe part of the question too, Jeff, was that -- whether that was the amount that we needed to complete the development of both of those drugs. And the simple answer there is no. There is more than that that's needed to ultimately advance both of those 2 products into those 2 settings.

Okay. That's fair. And then on HELIOS-B, I recall there was contemplation of an interim analysis. Is that -- do you have any further clarity there?

Yes. No, we're just very much planned on doing an interim with HELIOS-B, the specifics of which are not -- don't need to be yet and are not yet finalized. We'll have the benefit -- I think a very important point is we'll have the benefit of seeing APOLLO-B data with ONPATTRO before we do the interim with HELIOS-B with vutrisiran. So we'll have important insights on mortality, CV hospitalization data and other types of data. And we'll have those data in front of us as we think about the design of the interim for HELIOS-B. So we do plan on doing it. The details are open in terms of how we would finalize it. We'll obviously discuss it with regulators and get their alignment with it. But it's something which we think is an important part of the program. Akshay, anything else to add to that?

No. Nothing to add.

We'll take our last question from Vincent Chen with Bernstein.

Congratulations to you and your partners from the Blackstone team on the deal. One and a half from me. The first is when you speak of confidence in getting to profitability and not requiring further equity raises, what are the assumptions around the timing of ONPATTRO or vutrisiran approval in cardiomyopathy and the TTR franchise potential there? And then the second, if I could just follow up quickly on Ritu and Paul's questions. If I think about APOLLO-B, what geographies is that primarily being enrolled in? What impacts are you seeing from COVID in those areas? And to the extent that you can comment, how far enrolled is this study?

Yes. Okay. Well, let me cover the first -- well, let me cover both questions and then maybe Yvonne and Akshay can comment further. Look, when -- I mean we currently have 2 approved products. We expect 2 additional products that will reach the market by the end of the year. That's lumasiran and inclisiran. And we have 2 additional products that we think will reach the market in the '21, early '22 time frame. That's vutrisiran from HELIOS-A and then fitusiran in hemophilia from Sanofi. So -- and then, of course, we have these label expansion opportunities with both APOLLO-B and HELIOS-B, which obviously are very substantial commercial opportunities. And so when we look at our profile with 6 independent revenue-generating products in the next 12 to 24 months and getting to profitability, we've got all the firepower we need and the revenue-generating machine that we need to have to get there. And even if there is a slight delay in 1 label expansion study or whatever the case might be, it's not going to change our abilities with a lot of modeling that we've done to get to profitability without ever having to go back to the equity market. So we would have come out with that type of statement without very firm conviction around our ability to get there without going to the equity markets in the future. I don't know, Jeff, if you want to add anything to what I just said.

I think you covered it well, John. I don't have anything to add.

Okay. And then Akshay, do you want to handle the second question on APOLLO-B?

Yes. I mean I think the only thing to add, John, is that we have a big global footprint, starting with all our experiences from the original ONPATTRO, APOLLO study. We know all the sites around the world. We've added to that with sites that include alternate patients, so U.S., Europe, Near East, Far East, Japan, South America. We have a global footprint for all our studies now of that magnitude and in the TTR space. And so that's why I think we continue to enroll, and we're confident that we can enroll in sites around the world. Now of course, we continue to monitor very carefully. Barry emphasized the importance of home infusion in the commercial setting. We're making home infusion available in the clinical trial setting. That has been well received as well. So we're adapting to the situation and working as hard as possible. We'll obviously give updates as the situation develops if there are any major changes.

Yes. That's right. And Vincent, we don't give out accrual numbers in the middle of trials for obviously competitive reasons, so we're not going to do that here. But it is -- we're doing a lot, as Akshay just commented, to ensure that these studies continue and that either patients that are in the study already are getting drug on schedule and getting their assessments done on schedule or that we're continuing to add new patients into the studies.

Congrats again.

Thank you. Thank you very much. Okay. I guess that's the last question. So thanks, everyone, for joining us on the call. We're obviously really pleased to be entering this strategic financing arrangement with Blackstone. Obviously, it's so important now that we've secured our path to self-sustainability and are able to do that without any future equity financing. I do hope that you and your families are safe, stay safe and healthy. And we do look forward to updating you in just a couple of weeks' time at our first quarter call. So thank you very much, everybody. Bye-bye.