Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY)
J.P. Morgan SMid Cap Conference
November 29, 2012, 11:00 am ET
Mike Mason - VP, Finance and Treasury
Anupam Rama - JPMorgan
Anupam Rama - JPMorgan
I guess we will get started. My name is Anupam Rama. I work with Geoff Meacham, Michaels and John Bishai here at JPMorgan Biotech team. Our next presenting company is Alnylam Pharmaceuticals and presenting on behalf of the company is Mike Mason, Vice President of Finance and Treasury.
Good morning. My name is Mike Mason, VP of Finance at Alnylam. I would like to thank Anupam and JPMorgan for having us here today. It’s been quite a remarkable year at Alnylam from a clinical data perspective, a lot of compelling clinical data I'll go through in a minute as we continue to execute our plan of transitioning from a platform company into a product based company and building a top-tier independent bio pharmaceutical company founded on RNAi.
In my presentation, I will make some forward-looking statements. Please refer to our 10-Q filed with the SEC for additional information on Alnylam. So, Alnylam recently celebrated its 10th birthday and as a company committed to the development of novel therapeutics that use the natural pathway of RNAi interference.
As all of you are probably familiar with RNAi interference is a ground breaking Nobel Prize winning technology and a major discovery in modern biology. It’s a natural process that's involved in the control of gene expression.
Alnylam’s focus has been to harness this natural pathway as a way of turning off disease causing genes in order to advance and develop innovative medicines. It is now appropriate and possible to make a statement on this slide related to the state of delivery.
For many years, delivery of small interfering RNAi through specific cell types were really the big hurdle. But it’s fair to say now that with the data we have across multiple species including humans that the delivery of small interfering RNAi deliver has been solved. This has been solved in the context of lipid nano-particle as seen on the picture on the left.
This underlines the clinical data in one of our leading programs I will get into later in the presentation but also has been solved for use of conjugates forms of siRNAs that are administered with subcutaneous injection. So clearly the progress on delivery on two separate platforms has now enabled the advancement of innovative medicines to patients.
I would like to highlight some of the key accomplishments that have been achieved over the last year including the establishment of RNAi proof of mechanism in our liver cancer program ALN-VSP by looking at biopsy samples in patients treated with our drug and showing at a molecular level the engagement of the RNAi pathway and NAND.
Bottom left is a proof of concept data from our TTR amyloidosis program. This is the data that was published earlier this summer demonstrating knockdown of the serum levels of TTR in a Phase 1 study. This is the TTR program which is the protein which is the pathological cause of TTR amyloidosis and shows the specific knockdown of TTR at very low doses showing clear delivery to the limit.
And then in January of this year, we are very pleased to present data from our PCSK9 program where we showed statistically significant knockdown of PCSK9 as well as reductions of LDL cholesterol of up to 50%, constituting an important proof of clinical efficacy for RNAi therapeutics.
And as we've done all this work in terms of human translations, it’s also notable that our experience and exposure of human patients and subjects to RNAi therapeutics has grown significantly with greater than 575 patients or subjects dosed overall, including the patients that received drug for over 26 months.
So, clearly the exposure to chronic dosing and the human proof of mechanism from our VSP program, seeing protein knockdown in [man] from our TTR and PCS programs and human clinical efficacy from our second generation delivery platform from our PCSK9 program is very encouraging and very important for the company and the execution of our strategy going forward.
So the profile we've developed with our pre-clinical data has emerged as an interesting profile for RNAi therapeutics in humans. Specifically, a single dose of drug is associated with a specific potent and rapid knockdown of a target in a highly specific fashion, which achieves nadir knockdown effects at around four days or five days depending on the target.
And then, after a period of several weeks, the target levels return back to normal. So we've a durable, yet reversible biological effect and we believe that this data suggests that RNAi therapeutics will be administered once monthly to patients and possibly once every two months as a dose regiment providing significant therapeutic impact to patients with six to 12 doses per year in the setting of a chronic disease.
Now with these types of accomplishments in hand, we continue to execute on our Alnylam 5x15 strategy. This is a strategy that is focused on advancing RNAi therapeutics for the treatment of genetically defined diseases that have the potential to have a major impact in a high unmet need population, including orphan type diseases.
In addition, products arising from the strategy give us the opportunity to monitor an early biomarker in Phase 1 trials for human proof of concept data which is important and you will see why is it go through a TTR program and PCSK9 program later in the presentation because in Phase 1, we can measure knockdown of our target gene as well as potential clinical activity end points that are meaningful in the advancement of these agents.
Further, these are all programs so there is a clear and relatively rapid path for development and ultimately commercialization. The Alnylam 5x15 strategy really represents an attractive way of rapidly and efficiently advancing RNAi therapeutics to patients and also help to derisk our clinical development strategy.
Our goal here is to have five of these programs in clinical development by the end of 2015 including programs that are in advanced stages of development. These are all important programs, but we are focused specifically on two programs our TTR amyloidosis program and our Hemophilia program where we believe these represent the greatest opportunities for us to accelerate clinical development and advance these programs to patient.
So I will walk through these two programs and come back to the other programs later in the presentation.
The first of these programs is transthyretin-mediated amyloidosis, a significant orphan disease where there is enormous unmet medical need. There are about 50,000 patients worldwide with this disease. The clinical presentation occurs typically and the Familial Amyloidotic Polyneuropathy or FAP as a clinical manifestation or a cardiomyopathy or FAC that is the predominant clinical manifestation.
These patients have very few options available to them for their treatment. It’s typically fatal within five to 15 years of diagnosis. Currently, the only standards of care involved either a liver transplant which apart from incredibly debilitating from a quality of life perspective is also really only ethical to a subset of patients.
And more recently, a drug known as (inaudible) that was originally developed by a company known as [PolaRx] who was bought by Pfizer has been approved in EU but not in the United States and not withstanding (inaudible) in liver transplantation there is enormous opportunity for improvement with novel innovative medicines.
In addition, we believe that (inaudible) development program provide significant derisking around influence of the clinical trail design that we will be able to incorporate into development plans for our TTR program.
We currently on a 100% of the TTR program worldwide except for the JPAC region in which of this partnered with Genzyme. The target in this program is the Transthyretin gene, there over a 100 defined mutations of TTR and when this protein undergoes mutation, it has the propensity to misfold and deposit as amolyoid and peripheral tissues including the nerves and the heart and the amolyoid deposition results in tissue injury overtime, which is how the clinical manifestation are correct.
Our drug ALN-TTR02 which is currently in Phase 2 clinical trail targets both the mutant and the wild type forms of transthyretin. Our goal is to stop the expression of this misfolded protein and removes its disease causing impact.
We have demonstrated positive clinical data with our first and second generation technologies and we expect to complete the Phase 2 trail in mid-2013 and assuming positive results from the Phase 2, we are aiming to initiate Phase 3 late next year.
In addition, we also have a subcutaneous program that is advancing as well with the goal of IND in that program later this year of 2012. What we are looking at here is animal model data using the Val30Met transgenic mouse model.
If you look at the images on the right of the dorsal root ganglion, it shows that if we turn off the production of TTR in the liver and transgenic mouse model of the human disease that the disease can actually regress, the tissue deposit of amolyoids can actually be clear by the body by just turning off the tap and the liver that produces the mutant transthyretin protein.
This is very important data showing TTR amolyoid regression as we execute on our program. Now the question we get often is what's our confidence level that we are moving this protein in this case TTR will actually results in clinical benefit. And we have a number of things to look at that give us confidence, as we look at other systemic Alnylam (inaudible) diseases like ALMLA doses and AAMLA doses is that as little as 50% knock down of the related protein is sufficient to have a significant clinical impact. And we also have the (inaudible) example where while it was not accepted in the US, we still in the neuropathy scores saw our trend separation at six, 12 and 18 months. And this was a binder to TTR.
So there is significant evidence that the biology and all the thought leaders believe that this should convert into a clinical benefit. As I showed you earlier, the data in the NOAEL 30 met transgenic mouse model that it demonstrates pretty clearly that if you stop the production of TTR, you can get clearance of MLA plaque from the peripheral tissues. These data points are very important as we think they will move in this program forward towards the pivotal trial.
On the data side, we completed our Phase 1 study earlier this year, with a three to one randomization single dose escalation study with IV administration in 17 healthy volunteers, with the primary goal of safety and tolerability. But then secondly looking at pharmacokinetics and pharmacodynamics, impacts on TTR. In terms of the safety profile we are very pleased with the safety from the study with no serious adverse events that cause any pause as we move towards into a Phase 2.
In the data in terms of the pharmacological impact was pretty powerful as summarized here on this slide, and you can see at the higher doses the 0.15, 0.13 and 0.05 milligrams per kilogram which is the purple light blue and dark blue lines, you've seen essentially the real human data supporting the cartoon that I showed earlier in the presentation. When you see this precipitous drop in TTR levels hitting in may be around 7 to 10 days and a prolonged impact greater than a month, before we start to see the return of the protein levels even to a 50% of the starting level and the effect is completely specific, the red line here and is actually data from our PCSK9 trial were administering a different therapeutic and as you can see it had no impact on circulating TTR levels.
From a safety and tolerability perspective, you can see that the drug arm and the placebo arm are virtually identical. At the 0.5 dose we did see an infusion reaction. The patient was removed from the drug and then retreated over a two hour infusion and completed the full dose. That is something that we have seen earlier with our first generation and we see with lipid type drugs in general, but otherwise no difference between drug and placebo and no dose trends in terms of safety or tolerability. So very happy with the safety profile.
Looking forward we've moved into our Phase 2 study which began back in June. This is a study now in patients being run in Europe and has a two cycle once every four week administration of the drug. Again, as we continue to build out the safety and tolerability profile, we are now looking at clinical activity, looking at circulating levels and the impact of repeat dosing to really begin to optimize the dose as we think about a registration study. We expect to see data from the study in mid-2013.
And then just lastly, this is the preclinical data package that will support our next generation subcutaneous technology. We see an opportunity for early life cycle management of a second form of the drug. This is a newer technology for Alnylam that you are going to start to see influencing other programs in our pipeline over the next one to two years. And this is now a subcutaneous administration of an sRNA therapy.
And what you are seeing in this chart are the results of the primate study that by starting with daily administration of the drug followed by weekly administration, you get to a reduced steady state with around 80% knockdown of the resulting protein, and this dose is also safe and well tolerated. So the advantage here over the longer-term and especially for other programs in our pipeline is really the second platform with the subcutaneous administration.
Now, reflecting on the commercial opportunities for TTR, it’s really a wonderful opportunity for a company like Alnylam. It’s in orphan disease with a huge unmet medical need that is simply not addressed by today’s therapeutic approaches. We believe that ALN-TTR can absolutely be a breakthrough therapy for the treatment of disease and has the potential to achieve significant disease regression, based on dosing once every month or once every two months.
We believe that the fastest opportunity as we advance this program going forward is in the polyneuropathy indication. Since TTR is produced almost exclusively in the liver and based on our clear success of achieving delivery to the liver, we believe in an RNAi therapeutic, targeting TTR with this type of product profile can provide a solution to this devastating disease.
In terms of the commercial and pricing opportunity here, there is a significant pharmacoeconomics support for value based pricing in this indication, a very concentrated provider base as well as an active patient group. Creating an environment for commercialization of this product that is very attractive to a company like Alnylam. And beyond the polyneuropathy indication, there are also significant number of expansion opportunities as well, including those that can be enabled with the subcu formulation.
We recently formed a strategic alliance with Genzyme to advance our TTR amyloidosis program in Japan in the broader Asia Pacific region. Genzyme who everyone knows is the industry innovator and leader in bringing orphan drugs to markets, will leverage their proven regulatory and commercial capabilities in these markets in order to advance the ALN-TTR program, which includes both TTR02 and TTRsc, and very importantly we maintain all the rights consistent with our plans to develop and directly commercialize this potential breakthrough in North and South America, Europe and the rest of the world.
Under the terms of the agreement, Genzyme made an upfront payment of 22.5 million, in addition we are eligible to receive certain success based milestones up to $50 million and royalties that are expected to yield an effective rate in the mid-teens to mid-20s on sales of ALN-TTR in that territory. The royalties in this agreement represent a very attractive way for us to participate in the down-stream success of the product in Japan and other Asian countries. We believe that as a result of this new alliance, ALN-TTR will get the patients in Japan and other Asia-Pacific countries much faster.
Moving on to our second priority program in our 5x15 strategy is our Hemophilia program. Obviously the Hemophilia market is a pretty well understood market. It’s been well characterized as genetic diseases for many years. There are two basic forms of Hemophilia; Hemophilia A and Hemophilia B, and despite advances in treating these patients with blood-borne factors over the last several years, there are still segments of the patient population that are not well managed, particularly the so called inhibitor patients where a significant sub-set of the population really become refractory to the administered blood clotting factor.
These people still have an extremely poor quality of life, repeated bleeds, hospitalizations during the course of the year and puts a very significant financial and health management burden on the system and something that we are looking to change in our program.
We are targeting the antithrombin protein which is a liver expressed protein and a genetically defined target. We know that mutations in the 80 protein or sorry the increase in the thrombin generation which is what you want to achieve in blood clotting and Hemophilia patient. And we know there are certain genetic mutations in the part of the pathway in which antithrombin acts particularly in factor V which is one of the co-factors that when those mutations are co-inherited with Hemophilia that they actually have a beneficial impact on these patients.
So currently this program is in RDD transition and we are aiming to file an IND in 2013. The size data here, this is our existing animal package. This has been reviewed at multiple scientific meanings over the past few months. This importantly is a subcutaneously administered therapeutic from a Conjugate technology platform and next year this will represent the first bench of this technology in both our TTR subcu in this program into human beings.
In the top left chart, you can see the ALN-AT3 demonstrated significant knockdown as we have seen another preclinical targets with AED  for protein knockdown approximately 1 mg per [kg] after single subcutaneous dose. In the top right, you see a very significant and sustained knockdown of the antithrombin protein with multi-dose, and in the bottom you see increasing of thrombin generation and hemophilia mouse models in the bottom left and bottom right, and now we are planning on moving into large animal studies that are required before we go into Phase1 next year.
In terms of the market as I said, we think the market is really in four quadrants. On the left hand side, top left are the non-inhibitor patients, people are currently treated with the existing blood factors. Bottom left, the inhibitors patients who have become recalcitrant to the administration of the regular blood factors.
We intend to start with the inhibitor patients the bottom patient population of this slide. We think there is a very significant unmet need and we think our therapy can be particularly differentiated. But overtime we see an opportunity to expand into these other areas.
And when we envision the commercial opportunity for hemophilia for RNAi therapeutic, we know as of today it’s a multi billion dollar market, now defined by the use of the replacement factors. These patients, notwithstanding these agents still have a very poor quality of life including painful joint deterioration caused by micro bleeds, frequent IV injections leading to significant unmet need and a very significant commercial opportunity for ALN-AT3 with potentially a fast path to approval in this inhibitor patient population and a very significant opportunity from a pharmacoeconomic perspective.
In addition to our efforts in TTR and hemophilia, we are excited about our other Alnylam 5x15 programs which include our PCSK9 program, for severe hypercholesterolemia. Our program targeting Hepcidin pathway for refractory anemia and a program targeting TMPRSS6 for the treatment of hemoglobinopathies.
And just quickly on the data that we released earlier this year for our PCSK9 program. This of course is one of the most exciting targets out there today and this drug shows very significant ability in just a single dose without any company-administration of other medicines of knock down of PCSK9 of about 70% of the circulating protein levels, which is the graph on the left hand side.
On the right side, as I mentioned earlier the clinical efficacy, you can see significant reductions of up to 50% on average 40% of LDL levels, and that's the data on the right. And our plan with the PCSK9 is to move this forward into Phase 2 with a partner.
Now the common features of our Alnylam 5x15 programs are highlighted on this slide and just want to draw your attention to a few points. One is that we are going after very high unmet need indications. Number two in every single program we have a biomarker in our Phase 1 studies that we can measure whether it’s PCSK9, LDL, TTR levels etcetera.
So early in clinical development, we can establish for engaging the right pharmacology with our drug. And then the relationship with these Phase 1 end points to the ultimate end points needed for approval are in fact very, very robust. It’s something that we are very excited as part of our high value lower risk model advancing our pipeline.
Now in addition to our 5x15 programs a number of partner programs that focus on other disease indications. This includes our RSD program which completed enrolment in the Phase 2B study earlier in the year when we actually had results mid-year and the bottom line of the study we've narrowly missed our endpoint in terms of the primary endpoint but we are certainly seeing some clear and clinically meaningful treatment effects.
So we are in the process of having regulatory discussions now on what the best path forward is for this program. This program is currently partnering with Cubist and Kyowa Hakko. Our liver cancer program, we are excited to form a partnership with Ascletis over the summer and with the intention that they will take the data from our Phase 1 into a Phase 2 study likely and hepatocellular carcinoma patients in China.
And lastly, our Huntington’s program which is partnered with Medtronic and CHDI, this is the program that Medtronic drives the development here and we will realize benefit in downstream royalties and milestones. So to sum it up the pipeline is growing with our 5x15 program as well as the efforts together with our partners and we continue to believe that this pipeline will continue to advance as we move forward here and ultimately to the marketplace.
We also continue to explore other applications of RNAi. In August, we announced a deal with Monsanto with about $30 million upfront payment to make Monsanto our exclusive agricultural partner, great partnership, nice set of non-dilutive capital and an area that we would not be moving forward on our own.
Monsanto is obviously a great partner and very technologically sound in the field and we are also excited as you look at this wheel, we have a 17% ownership stake in a company called Regulus which is focused on micro RNAi therapeutics. Regulus is [advancing] multiple micro RNAi therapeutics towards a range of different targets and actually recently went public in October raising around $51 million.
And in closing just to wrap up a brief update on the financials and our goals for 2012 regarding our financials, we finished Q3 with $296 million in cash with no debt. Our guidance for 2012 was that we finished with greater than $215 million in cash. So a very strong balance sheet that allows us to prudently invest in our 5x15 efforts.
In terms of goals, it’s certainly been a great 2012. We announced the successful TTR02 data over the summer as well as the PCSK9 clinical data and RSV as well and over the next sort of 12 months or so, there is a lot of big data points coming up including the TTR program with the results from the Phase 2 and assuming success moving into a pivotal study as well as our TTR subcu and Hemophilia program going in to clinic. Those are certainly some of the key events that will be value drivers for Alnylam in 2013.
So with that, thank you for your time and attention. Hopefully, I am able to share the passion that we feel at Alnylam on developing entirely new class of innovative medicines and with that I thank you and I'll turn it over to Anupam for any questions.
(No Question and Answer Session)
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