We have discussed RNAi and ALNY in the past (Eye on Alnylam: Silencing the Gene) and flagged ALNY as the most promising of the companies in the gene silencing field. Having taken a less than 5% stake for apparent regulatory reporting reasons, but at a significant premium, they gave ALNY investors a great present yesterday. ALNY stock rose by just under $8 or 52% on the day. ISIS Pharmaceuticals (NASDAQ:ISIS), a related company by IP licensing and underlying approach, rose by over 18% on the day.
Although some distance remains to an economic product this is a great deal for ALNY and may prove a catalyst in the area of using drug silencing methods in drug development.
The cash inflow has a calculated effect on the stock price of between $8 and $8.50, which was realized yesterday. The reaming milestones and payments amounting to about $1 billion dollars have a discounted value of between $2 and $3. Any price less than $25 to $26 is a buy for ALNY, in our opinion. The stock closed at $23.12 yesterday.
ALNY 1-yr chart: