Alnylam Pharmaceuticals Inc.’s (ALNY) first quarter loss of 38 cents per share was wider than the Zacks Consensus Estimate of 32 cents per share and the year-ago loss of 29 cents per share. Lower revenues and higher research and development expenses exacerbated the loss.
Revenues for the reported quarter fell 15% from the prior year to $20.9 million but were in line with the Zacks Consensus Estimate of $21 million.
Quarterly Details
Revenues in the quarter were inclusive of $14 million from the company’s alliance with Roche (RHHBY), $5.8 million from Alnylam‘s partnership with Takeda Pharmaceuticals, in addition to $1.1 million of expense reimbursement, amortization revenues and license fees from Cubist Pharmaceuticals (CBST) and InterfeRx licensees.
Research and development (R&D) costs climbed approximately 6.5% to $26.3 million. The rise was primarily attributable to increased spending on pipeline expansion.
General and administrative (G&A) expenses in the reported quarter fell about 9% to $10.2 million. The decrease in G&A spend resulted from lower professional service fees mainly for legal activities.
2011 Guidance
In the forthcoming quarters of 2011, Alnylam expects R&D expenses to decline slightly. Alnylam expects to exit 2011 with a cash balance of more than $275 million.
Pipeline Update
Alnylam’s core product strategy, introduced in January 2011, is Alnylam 5×15. The program is aimed at developing RNAi therapeutic products for the treatment of genetically defined diseases addressing major unmet medical needs. As part of this strategy, the company aims to move five RNAi therapeutic programs into clinical development by 2015. These include ALN-PCS (for hypercholesterolemia), second generation ALN-TTR (a hepatitis C compound), and ALN-HPN (refractory anemia). Alnylam expects to file an Investigational New Drug Application (IND) for ALN-PCS in the second quarter of 2011 and report data by the end of 2011. An IND application for ALN-HPN is expected to be filed in 2012.
A phase I/II clinical study of ALN-VSP to treat liver cancer completed enrollment in April 2011. Alnylam expects to present data from the trial at the American Society of Clinical Oncology meeting in June 2011. Moreover, Alnylam plans to partner the program before initiating phase II studies planned for 2012.
Our Recommendation
We currently have a Neutral recommendation on Alnylam, which is supported by a Zacks #3 Rank (short-term “Hold” rating). We are pleased with the company’s newly launched “5×15” initiative and the progress of the company’s pipeline. Alnylam’s balance sheet is also very strong. We, however, await further visibility on the clinical progress of the pipeline as well as Alnylam’s ability to enter into large partnerships.
ALNYLAM PHARMA (ALNY): Free Stock Analysis Report
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