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Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY)

The 25th Annual Piper Jaffray Healthcare Conference Transcript

December 4, 2013 11:00 AM ET

Executives

Barry Greene - President and CEO

Analysts

Ted Tenthoff - Piper Jaffray

Ted Tenthoff - Piper Jaffray

Good day, everyone. And we’ll get started with the presenting company Alnylam. My name is Ted Tenthoff. I’m the Senior Biotech Analyst here at Piper Jaffray, and before I begin, I’m required to point out certain disclosures regarding the relationship between Piper and Alnylam that are posted in the back of the room and also at the registration desk.

As you probably know, Alnylam is a leader in developing RNA interference or RNAi therapeutics. The company has a dominant patent position, scientific know-how and partnership. And now Alnylam is developing a rich Orphan Drug pipeline.

Alnylam just initiated the Phase III pivotal trial of patisiran to treat familial amyloidotic polyneuropathy or FAP patients, which is caused by transthyretin or TTR amyloidosis. Well performance in 2013 which has been significant has been driven by patisiran and ALN-TTR subcu progress. We look for value to begin to be ascribe to Alnylam expanding Orphan Drug pipeline in 2014. These drugs include ALN-AT3 for hemophilia and also ALN-AS1 for acute intermittent porphyria. Here to update us is Alnylam President and CEO, Barry Greene. Barry thanks for being with us today. I always appreciate seeing you here.

Barry Greene

Ted thanks and I appreciate you and your organization for the meeting having us here.

Ted Tenthoff - Piper Jaffray

Absolutely. So we are going to keep this informal. I am going to ask couple of questions but if you do have any question, please don’t hesitate to raise your hand and we’ll bring into the conversation.

So, Barry, start this off by telling us a little bit about TTR amyloidosis, what is this debilitating disease and what are some of the differences between the two common [in foreign] FAP and familial amyloid cardiomyopathy or FAC?

Barry Greene

Yeah. Thanks Ted. So TTR amyloidosis or ATTR is autosomal dominant inherited disease. It caused by the mutation in gene synthesis and liver parasite called transthyretin. And what happens and this is very familiar disease to other systemic amyloidotic diseases. The TTR protein miss folds and the miss folds in protein aggregate in peripheral tissue.

Now there is over 100 known forms of these mutations but they fall into two predominant disease types. The polyneuropathy which is pain in peripheral nerves leading from [walking] morbidity to frankly been abandoned in five to 15 years.

And then the cardiomyopathy which is driven by other kinds of mutations which tends to lead to heart failure and upon diagnosis these patients can actually progress much more rapidly, some in two to four years, probably highlighted by lack of early diagnosis.

So what we are doing with our program patisiran which is an IV form targeting polyneuropathy and ALN-TTR subcu which is our (inaudible) in cardiomyopathy is knocking down the levels of transthyretin both mutant and wild-type to about 80% which exceed the 50% that the field commonly believe you need to reduce in certain protein diet and stop the progression of disease across both of these program.

Ted Tenthoff - Piper Jaffray

Great. So you just reported Phase II data at a Meeting done in Rio de Janeiro. Firstly, how did you enjoyed Brazil, but more importantly, walk us through the data that you reported over there?

Barry Greene

Well, we work both, on the Brazil beautiful, we drove by the beaches, while we were enthused, it was very nice. I encourage everyone to go. The coconuts were good every parts of Rio.

So, yeah, we had a great meeting, the FAP Community meets every other year. Two years ago, it was in Kumamoto, Japan. This year, it was hosted by the Brazilian continuity and it was one week meeting preceded by meeting with patients of 120, 130 patients which was incredibly enlightening in terms of seeing with various disease but also the encouragement this community had in the ability to access new approaches to leading them with approaches which is causing the disease.

So the data for Patisiran are Phase II multi-dose study showing significant knock down reduction in TTR, both after the first and second dose but 84% and 87% mean respectively and was very clear from our data that the regimen that makes sense for us to implore with was 0.3 mg/kg q3 weekly dose which really had a very nice flat continuous markdown.

From a safety and tolerability perspective, the drug Patisiran in multi-dose continue the safety and tolerability profile that we saw with the Phase I study and namely it was very well tolerated. The adverse events that we reported were three patients across the whole study that had an infusion reaction. In all three of these cases, drug was stopped and we re-administered at a slower rate.

Incidentally, there were no infusion reactions in the q3 weekly either because of the small end or potentially because we changed the dosing regimen. We learned two pre-clinical studies that if we provided micro dose for the first few minutes and then normal infusion dose, it lowers the incidence of the infusion reaction so that’s may also be what’s going on.

Ted Tenthoff - Piper Jaffray

We saw also at the meeting, it’s something that was interesting coming out of the meeting, was that Diflunisal reported some encouraging two-year data. Now there was kind of two sides of the story safety as well as efficacy but I think that was actually very encouraging for the sales and is encouraging for your approach. So characterize this effect and how does this impact your potential development plans for Patisiran?

Barry Greene

Yes. The very last clinical presentation today is by John Berk at BU, who presented the results of Diflunisal. Now going into the meeting, the community had been talking pretty openly including on frankly industrial calls, not that we hosted but other analysts hosted that the Diflunisal data were positive. And that’s in fact, what we saw which is a phenomenal new trust in the patients but the only backup a second and these data are not yet published and the slides are not yet available but you can characterize what we saw.

It’s important to appreciate and my belief is that this stabilizer like (inaudible) has potential benefits for these patients and it’s great news for the patients and it’s great news for our ability to measure the potential impact of the drug on this. And we will talk about that in a moment.

We completely understand this was an academically driven study, not subject to classic industry statistical rigor and not subject to any regulatory rigor at all. Diflunisal is a non-steroidal anti-inflammatory that Merck had in the market. It’s now generic manufactured by Teva and available to some Canadian manufacturers.

The issue it had as a non-steroidal anti-inflammatory was GI talks that really never took off as NSAID. The data that was presented on its face value showed that 24 months there was a statistically significant difference between the placebo arm where patients continue to progress and the (inaudible) arm where they rapidly showed progression as presented by the investors at this meeting. What was a bit confusing, however, was that there was about a 40% dropout across both arms, more on placebo.

And the data that I just represented being statistically significant was not necessarily predefined by the stats plan, nor do we understand what the various ends were or how all the data of missing patients will drive, so a good caveat. But bottom line is I think it works for those patients who don’t have any other options.

Ted Tenthoff - Piper Jaffray

So just, I did, on top my head, I mentioned that, I always thought of as a peer kind of like Alzheimer disease for the perforate. Now since we are seeing because we have seen NIS+ tried for Alzheimer disease. So that agonistically it’s intriguing for sure. But back to the patisiran, based on the results that you guys have reported, you have now initiated the Phase III APOLLO trial. Walk us through this trial design, what the endpoints are and when do you think we could actually get completion enrollment or data?

Barry Greene

Yeah. So, let me start with the endpoint. The endpoint is modified NIS+7, which is a combination of Neurologic Impairment Score, an endpoint that is waived and driven by Mayo and educated across the neurology community advised by the Mayo Clinic, very clear, well trained, consistent set of measures.

I mentioned earlier that the big takeaway we had given all the caveats that they could resolve was even a stabilizer, given all the caveat showed an impact on NIS+, which is phenomenal news for us. So before we start -- at least they are consistent with the natural history work that we’ve done. So our study here is two other patients study, two to one randomization between patisiran and placebo, 0.3 mg/kg q3 weekly.

We are dividing patients between -- there are some limitations, so 330 m under 50 versus non-330 m, so age matters. That wrapped up a NIS score between 10 and 100, so that makes them stage 1 or 2 FAP, and the studies powered to show a delta between initiation of mNIS+7 and mNIS+7 of 80 months, 37.5% or greater between drug and placebo.

Ted Tenthoff - Piper Jaffray

Excellent. And when do you think we maybe able to get some data from that site, how large is it again?

Barry Greene

So the 200 patient study -- but we also have it and I will come back and answer it back, Ted. I will remind you that after our Phase II study where we saw this greater than 80% knockdown first and second dose, we are enrolling patients over to an Open-Label Extension Study, Phase II Open-Label Extension. The tremendous benefit of that study is that we are going to be able to see it amongst three, four, five and six continued future knockdown.

We are going to continue to gain more insight on safety and tolerability now but with multiple doses. And each of these rollover patients are going to have to be based on mNIS+7. So in our view it is called 2015, we will be able to gain some insight on the potential impact of patisiran on the eventual clinical endpoints. So we have lots of data in our hands way before we open the envelope on the Phase III studies.

In terms of timing on the Phase III, our goal is to close Phase III as rapidly as we can. We are certainly opening a significant number outside the mid 30s in terms of the number of sites and now, we will provide better guidance next year in terms of timelines as the sites gets up and running.

Ted Tenthoff - Piper Jaffray

Perfect. One other things that I really appreciate and your guys approach to treat to try and address as broadly in FAC and FAP is the IV approach with Patisiran as well as the subcutaneous formulation that you are developing as well. And this is based on GalNAc-Conjugate technology. So maybe if you can just talk of that at a high level, what this conjugation technology is doing and how it’s actually enabling you to deliver the siRNA subcutaneously?

Barry Greene

Yeah. I mean, Ted, you mentioned in the beginning, it’s been quite incredible 2013, which is largely driven by clinical data. And the clinical data that was incredibly satisfying was the data we presented is the first program we put in the clinic with the GalNAc conjugate ALN-TTR sub-Q.

We presented data in September, showing both 5 and 10 milligram per kilograms at the dosing schedule, which was five doses in the first week and then five week thereafter. They achieved 80% to 90% knockdown, which is really spectacular data for sub-conjugated approach.

What our team figured out at Alnylam, we’ve been very dedicated to solving the delivery problem from day one. As you are aware is that there is a receptor on a parasite, it does look like approaching receptor, which internalizes sugar moiety. And we discovered through a significant amount of work by our own scientists and collaborators that by attaching a itinerary GalNAc molecule basically to sugar moiety, they target this ASGP-R receptor in the liver, internalized our siRNAs, which then escapes the side of ours and which is where the Alnylam machinery works.

It’s remarkable that we’re consistently between mild-thyretin, non-human primates. And with the TTR subcu, subcu data, we can say confidently that the mg\kg level, the knockdown we’re seeing in non-human primates actually predictive of what we are seeing in them. It is remarkable in the world of drug development and biology that we have, at least on a protein knockdown basis, a predictable model that helps us gage clinical dose and clinical regiment across the entire platform.

Here is the standpoint I will add to the platform is that, ALN-TTR sub-Q with the seminal molecule in the clinic. I mentioned that we saw 80% to 90% knockdown in 5 and 10 mg\kg. We’ve learned a lot about how to create even greater prophecy in a molecule. And if I take ALN-AT3, our hemophilia program as an exemplar, it shows a 100% knockdown, but AT3 practically adds about 1.5mg/kg with greater than 80% as 0.5. So it’s a 10X improvement impotency from ALN-TTR sub-Q to hemophilia. And every program will be different, but it clearly greatly improved the impotency of the molecule.

Ted Tenthoff - Piper Jaffray

Excellent. Now with sub-Q, you are initiating a Phase II FAC program sometime since, so this is -- maybe help us understand what the rationale is to move from FAP to FAC, is it something that sub-Q is specific, or is it simply kind of part of the plan to address the thorough and larger ancient population.

Barry Greene

Yes, we did. We from beginning have been very committed to tackling ATTR. We committed to the patients, we committed to the key affiliated groups. It’s a community we’ve been working with for almost four years now, starting with an earlier version -- earlier IV version of TTR, which we did not think had all the attributes, particularly on a commercial drugs. So we move the ALN-TTR2. And what we said before, Ted is ALN-TTR2 is at least a year ahead. We had a Phase III design ready to go in FAP patient. And based upon the patients, their characteristics in terms of how well they are and their location and site a two, three week the IV approach, a great approach for these patients and the community was excited to move forward.

The cardiomyopathy patients happened to be a little bit more beat up, have greater kidney exposure, for example, often the diseases picked up later in life, as I mentioned already, sometime they have only two to four years survival.

So, having another molecule that we in parallel could pursue for us, they see just made a lot of sense for us. And clearly a once a week or twice a week, at home kind of subcu small volume drug, easy to administer is very obtainable with this patient population.

Ted Tenthoff - Piper Jaffray

Now last year you partnered the TTR program with Biogen in Asia. It’s tough to imagine a better partner for this kind of working indication. Tell us about that deal and what this means for the overall global aspect of the program?

Barry Greene

Right. So, we partnered the TTR franchise, the ALN-TTR patisiran and ALN-TTR subcu with Genzyme Sanofi.

Ted Tenthoff - Piper Jaffray

Sorry.

Barry Greene

And we were pretty clear going into this year. We have been clear in the past. We made it exclusive in our January presentation that our goal for our 5x15 Program which are the genetically defined targets using our current delivery clear Phase I biomarker programs. We want to commercialize in North and South America and Europe on our own and we would selectively partner Asia.

Genzyme was incredibly interested in TTR, frankly more broader than just Asia, but they have a significant presence in Asia and the characteristic that we had given the right deal economics, which we really favor in the backend that is, royalties that it’s a top tier, get close to kind of 50-50 profit share kind of royalty.

It made more sense in Genzyme hands than to try to go on our own. They had infrastructure. They knew the community and our catalyst is that they would feed the drugs to patients much faster than we put on our own, ultimately benefiting the patients and an economic return for us. And those kinds of deals are certainly other ones that we’re having now across at our programs.

Ted Tenthoff - Piper Jaffray

Yes. And you have done other partnerships this year but to really kind of focused on the proprietary programs, because I think that’s where we are going to see a lot of value driven in 2014?

The next program which we will touch on a little bit is AT3 targeting antithrombin III for hemophilia A and hemophilia B. And that this is an area that John knows pretty well with his background and work around (inaudible). So, tell us about this target and sort of what the goals are for this program. How quickly could you move?

Barry Greene

Yes. The program approach is to target antithrombin also called AT3. And we know that when you look at the coagulation cascade both intrinsically and extrinsically, the key mediator, the thrombin generation is antithrombin and in the background of the hemoclot setting with factors missing, because if you have your foot on the break constantly of the engine that’s trying to cause thrombin generation.

So by knocking down antithrombin we take the put off the break and provide thrombin generation as available as needed. So the best way to think about this is that by increasing thrombin generation we should be able to move patients from severe disease genotype to a mild disease, in other words progress need per year.

Now, the added benefit of being a subcutaneous approach versus the factual approach which are all IV either once, twice or three times a week, often requiring a central line as you know, is easy to administer, prophylaxis for many patients settings.

Our thoughts right now are that that the biggest unmet need areas are inhibitor patients where they really is no available prophylaxis for these patients and some of the higher need on-demand patients for a variety of reasons on prophylaxis with factor which will be our first phase through getting to the highest unmet need area.

What's exciting about this program in addition to the potential prophylaxis for inhibitor, it’s a game changer for those patients and prophylaxis for high end unmet on-demand patients which is also quite a best for them is that if we get to the end of Phase III and we have shown that we can change disease genotype so lower bleed and the drug is very safe, there is no reason why this can't be an approach for all hemophilia, all A, B, and frankly, any lower bleeding disorder where thrombin generation is the issue.

Ted Tenthoff - Piper Jaffray

Now we are going to show you some preclinical data done at hematology this weekend in New Orleans and is there any theoretical concern about producing too much thrombin or how do you kind of gauge that safety window?

Barry Greene

Yeah, that’s a great question. One is the -- one of the key focuses we had on the program is truly understanding, the on-target therapeutic index. So we are knocking down anti-thrombin and theoretically you can overshoot thrombin generation causing thrombolytic effects where you don’t want to, right thrombotic effects. So we are very focused on that. In fact, our ASH abstract caused somewhat of a stir quite…

Ted Tenthoff - Piper Jaffray

Infusion really.

Barry Greene

Because we are able to show is in the background of the hemophilia model, we use hemolysis for this one. At doses exceeding the therapeutic dose by 100 times, we had a 100% survival and in the cost of wild type, we’re bleeding anti thrombin which is no where near where we will go in the clinic at 30 mg/kg. We saw the anticipated thrombotic effects and mortality in mice.

That gives us a sense that we were a 100x on target therapeutic index to go -- to move into the clinic. I would add to that, that the nine human primate models that we did were at 1.5 mg/kg for over three weeks. We essentially bleed thrombin, didn’t lose any non-human primate and allowed to recover, really showed the ability to tune anti-thrombin and the recoverability of anti-thrombin.

So at ASH, we will continue to extend the analytic work. This is community as everyone knows that is reluctant to change as we’ve been dealing with kind of next better factor as the advantages to patient population. We are coming in with something quite frankly different and therefore the amount of data that we are going to gather to support eventually the clinical data will continue to be robust. So you should anticipate more of that at ASH.

Ted Tenthoff - Piper Jaffray

I want to try to squeeze in two questions with the last two minutes that we have, first on porphyria. This is a program that I think people probably are not that familiar with and could advance into the clinic next year. So may be on a high level, tell us what you are doing here and what these patients are going through?

Barry Greene

Yeah so, the key instrument in porphyria is a very rare orphan disease but the benefit is that the patients are known there is very, very active physician consortium, very consolidated, and is very active patient consortium. So what we know is about 5,000 patients in U.S. and Europe that have at least one attack a year and about 500 patients mostly women driven by menses have monthly attacks. And the disease acute intermittent porphyria is caused by PBG deaminase dysfunction which causes an over expression of what become toxic intermediate, ALA and PBG and the heme biosynthesis half way of the liver.

What we are doing is knocking down ALA at ASH, which we have shown we can do across target, stopping the toxic intermediaries for being made in the -- the gold standard animal model which we’ve done at Mt. Sinai, we have already shown that having more data that allows us. What’s really exciting about prophyria is after we show in a multi- dose setting that we cannot (inaudible) down, frankly the next step is a Phase II, III where given good natural history, we can show reduction in attacks in these patients pretty rapidly with a pretty small end. This program, that while it’s -- will be in the clinic next year can be very rapidly into phase III.

Ted Tenthoff - Piper Jaffray

I look forward to progress on that. And just lastly you guys ended the third quarter with a $367 million in cash received and other $7 million from Genzyme (inaudible) milestone for Patisiran, how long will this fund the operations?

Barry Greene

So the guidance here is that we will end this year with over $320 million in cash which provides a multi-year -- certainly enough to get in par.

Ted Tenthoff - Piper Jaffray

Great. Well Barry, thanks so much for being with us today. I always appreciate spending time with you. I am excited for the story into 2014 and I thank you all for joining us for the Alnylam fireside chat.

Barry Greene

Thanks Ted. I appreciate it.

Question-and-Answer Session

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