Alnylam Pharmaceuticals' CEO Presents at Morgan Stanley Global Healthcare Conference (Transcript)

Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY)

Morgan Stanley Global Healthcare Conference

September 11, 2012, 01:30 pm ET

Executives

John Maraganore - CEO

Mike Mason - VP, Finance

Analysts

Dave Friedman - Morgan Stanley

Dave Friedman - Morgan Stanley

Thanks everyone for joining us. Dave Friedman one of the biotech analyst and in terms of disclosures for myself and Morgan Stanley, you can look on morganstanley.com/researchdisclosures and we’ve team from Alnylam up here; very exciting platform, RNAi company and more. And on the far side here I’ve got Mike Mason, VP of Finance and on the near side, John Maraganore, CEO. And so maybe if you guys want to give a brief sort of statement or overview about the company at all and then we can then just dive right in.

John Maraganore

Sure, David thanks and thanks for having us here at the conference. Alnylam is a RNAi therapeutics company that has focused from the beginning on developing small interfering RNA drugs and over the last many years, we really been focused on perfecting the technology so that we can achieve the optimization of these molecules, introducing drug-like properties into these molecules and ultimately delivering these molecules into the right cell types and tissues in the body to be able to harness the indigenous RNAi pathway to create important new medicines.

And I think it's fair to say that over the last two years in particular, the work that we've done on achieving delivery of small interfering RNAs to liver cells and documenting in human trials that we can in fact knock down targeting genes man with very robust pharmacological effects and I think that largely comes out of the work that we’ve done in our transthyretin amyloidosis program, but also the work we've done on our PCSK9 Hypercholesterolemia program.

I think we've now clearly demonstrated that RNAi does work in humans; RNAi is the foundation for generating new medicines and we're excited to continue to executive on that plan and advance programs with a real focus on our transthyretin amyloidosis program and also on our Hemophilia program where we are targeting anti-thrombin as the foundation for building an exciting company going forward.

Dave Friedman - Morgan Stanley

So maybe if we can just start with one broad question and you guys have been around for a while and your progress appears to be you know accelerating every year. So if you can maybe just highlight from a technological standpoint the one or two key aspects over the last year or two in terms of making RNAi more and more drug-like and deliverable that you think people should understand the best in terms of understanding where you guys are headed with this?

John Maraganore

Yeah, I think there really are two things David that are notable; one is that, you know we've really industrialized and advanced lipid nanoparticle technology in clinical studies, these are liposomal formulation of small interfering RNAs and we've made substantial improvements in those molecules, in those delivery formulation that enable an appropriately robust knock down of target genes in animals and also in humans with a good therapeutic of index, which is important.

The second part, the second key thing has been the advancements in so called conjugate sRNA technology which are in many ways simpler molecules. These are small molecules that are handed out to the small interfering RNA and mediate receptor uptick of these molecules of the cells and those data have panned out beautifully in animals system right now and we’re about to go to human trials also in our TTR program.

So, both platforms with the nanoparticles, but also conjugate base delivery of small interfering RNAs really have been the key things that have enabled the advancement over the last couple of years. Of course before that let’s not forget the important underlying aspect of RNAi which is these double stranded RNA molecules and as triggers of this biology are incredibly potent and obviously have served us well in our overall drug discovery efforts.

Dave Friedman - Morgan Stanley

And in terms of the conjugated small interfering RNAs, is that a technology that is going to primarily optimize delivery to existing places where you can already get or is this part of what is going to help bring the technology in a more directed fashion to specific tissues throughout the body?

John Maraganore

Well, I think at least in the near-term it’s going to help and advance and expand how we can develop programs for liver specific gene targets and that’s because we are using the asialoglycoprotein receptor as a receptor for uptake of the sRNA. And we are very pleased with that approach, we think that that approach enables subcutaneous delivery of sRNAs and we get very potent effects with very wide therapeutic index with that technology. And in many ways we think that that’s going to be a technology for the future that really together with the LNP technology is what’s used going forward.

So we are excited about that at least in the near-term the focus will remain on liver and probably reason for that David is we are really going to execute on our plan that we call Alnylam 5x15 which is the target, liver expressed target genes with our sRNAs as a way of building exciting product opportunities for the future and that will start with TTR amyloidosis and follow with other programs that are in that pipeline.

Dave Friedman - Morgan Stanley

And anyone should feel free to have the session be as interactive as possible, so if there is any question at anytime please raise your hands, share out something and we will make sure that we can get your question asked.

Question-and-Answer Session

Dave Friedman - Morgan Stanley

Maybe if we can just jump right into the TTR program and that’s sort of come on strong as really one of the lead programs here; so if you can talk briefly about the disease, the unmet need and then your approach to-date in terms of how you believe you can fulfill that unmet need?

John Maraganore

Yeah it’s a good question David. So TTR amyloidosis is autosomal dominant inherited disease; it’s a debilitating orphan disease that presents in patients either as a neuropathic disease which typically starts with affects on the lower limbs and can progress overtime to affect the patient more broadly and/or it presents as a cardiomyopathy and sometimes patients present with the clinical manifestations.

Typically patients present within in the middle of their life typically at the age of 40, 50 or so and unfortunately patients die within 10 to 15 years of diagnosis because there are no effective therapies for these patients. Liver transplantation is used in a small subset of polyneuropathy patients, but it’s had somewhat limited success and somewhat limited utility across the setting.

In every case TTR amyloidosis is caused by genetic mutations in the transthyretin protein which is a liver expressed protein that circulates in the serum and when it undergoes mutation it has a propensity to misfold and form so called amyloid deposits in a number of different peripheral tissues including the nerves, that gat and also the heart and it's the deposition of transthyretin, misfolded transthyretin in those tissues that ultimately results in tissue damage and clinical pathology.

So our approach is really to effectively remove TTR from the patients. TTR is the toxic protein in the setting. It is causing the disease in the setting and our approach is to selectively and obviously safely silence the TTR protein in circulation both the wild-type protein and the mutant protein to generate an impact on clinical disease.

Dave Friedman - Morgan Stanley

So given that your drug is through sequence specific, how much variety are you seeing in the TTR gene in the diseased patients as well as in the healthy gene and is there too much variability? Is there a conserved area that you can reliably target?

John Maraganore

So there are a 100 different mutations that have been described for transthyretin but we're targeting region of the cell called 3-prime UTR, 3-prime un-translated region of the gene which is conserved across all known [areas] and so therefore, we're able to knockdown all mutant forms of TTR but in addition I think quite importantly David, also knockdown the wild-type protein because our data from orthotopic liver transplant experience of patients shows that even after liver transplantation, the wild-type protein can continue to accumulate in the existing amyloid deposits. So the therapeutic hypothesis is not only to knockdown the mutant protein but to knockdown also the wild-type protein.

Dave Friedman - Morgan Stanley

In terms of, you guys typically have very high degrees of knockdown. What are the ramifications of removing this protein from people?

John Maraganore

Yeah, that’s one of the beauties of our target selection in this case because we know both in human datasets as well as in the context of animal models that you can knockout TTR or knockout aspects of TTR’s biology without any serious adverse events. TTR is marginally involved in transport of vitamin A in the body together with retinol binding protein and there is no real significant vitamin A deficiencies associated with knockdown of TTR because they are redundant pathways for vitamin A transport in the body.

And so to some extend, we feel very comfortable about the ability of knocking down TTR as much as possible to have an impact on diseases without worrying too much about the safety consequences of that. But obviously if there are implications of vitamin A metabolism as a result of knocking down TTR, you can also supplement the care of the patient with exhaustion resources of vitamin A which is readily achievable.

Dave Friedman - Morgan Stanley

And the exhaustion of vitamin A if you did end up needing to give that there are ways to give it enough quantity that will circumvent this TTR pathway?

John Maraganore

Absolutely.

Dave Friedman - Morgan Stanley

And so, US actually have a couple of different versions of this drug that you have been working on, so maybe if you can just describe the three different versions, why you have three different versions and whether the plan is to bring one or more forward only one, all three and that what point you start making your decisions?

John Maraganore

So I mean clearly the first generation TTR01 really was a proof of concept molecule, it used the first generation with the lipid nanoparticle technology that works but requires higher doses to work. It doesn't really have an optimal therapeutic index overall and so it was able to be used in the Phase I study in patients that showed knockdown of TTR in patients of around 40% and it was also useful data point because it showed consistent knockdown not only of wild-type protein but also of mutant protein in a patient setting.

And we reported those data initially back in November of 2011 and also updated the data in I believe it was March of this year. As we were doing that, we also made major progress on the lipid nanoparticle technologies and formulations specifically with our second generation platform and as we advance in the first generation program forward, we also backed it up with the second generation lipid nanoparticle formulation TTR02 and we just reported data from that study where we showed up to 94% knockdown of TTR after single dose that’s lasting for weeks after a single dose administration.

And those data clearly demonstrate the type of knockdown that we would like to see in our ultimately in Phase III study with a commercial product. And so our goal with TTR02 is absolutely to advance that until we expect to start at the end of next year and through the market with a drug that shows the performance level of TTR knockdown that we think will make high impact in the management of these patients.

We also are developing a parallel a subcutaneous version of the drug that uses of our GalNAc conjugate technology. We are planning on filing the IND for that program by the end of this year, we will begin dosing, we should have data by this time next year from that study and the goal with that program is to really expand out the market opportunity.

If you look at TTR amyloidosis not only does it include the FAP polyneuropathy patients, patients with cardiomyopathy but other segments of the disease where there is significant burden of disease where a sub-cu delivered form of the drug might be optimal given convenience aspects to it.

So we plan on fully advancing that program in addition to the TTR02 program going forward.

Dave Friedman - Morgan Stanley

And then in terms of the sequence, I assume the sequence from the sub-cu form and the TTR02 form they are the same, targeting the same area or is there any difference?

John Maraganore

Similar, the siRNA was identical between the first generation lipid nanoparticle and second generation of the nanoparticle identical. The siRNA sequence in the sub-cu version is slightly different than the other version, but it also recognizes a highly conserved region of the TTR gene and we validated in preclinical studies that it shows beautiful knockdown of both wild-type and also mutant forms of the protein and (inaudible) models.

Dave Friedman - Morgan Stanley

Is there a reason for switching or?

John Maraganore

Well, it‘s just all around optimizing the gamma conjugate to have optimal biological activity and so sometimes shifting the sequence around helps in actually doing that.

Dave Friedman - Morgan Stanley

And obviously 94% is a lot of knockdown, is there something in animal model to tell you sort of a threshold of suppression that you need to see, is it that close or is it, are you giving yourself a fairly wide margin affair here?

John Maraganore

It’s fair to say that we know from human clinical studies that as little as a 50% knockdown of amyloidogenic protein in diseases like light chain Amyloidosis for example, result in significant clinical benefit and so 50% is probably your minimal threshold in terms of human data to support that. We then know in orthotopic liver transplant where patients that they are treated early enough in the disease have the mutant protein is actually removed from their body by virtue of the new liver that only bears a wild-type protein but that can be in some cases that can result in a significant disease improvement and stabilization in the patients. So we have bands of data that give a sense around where we want to get knockdown levels achieved to. At the end of the day, we think an 80% or greater level of knockdown is optimal, based on all the data that are out there including data from animal models as well and we believe that those type of knockdown data will result in important clinical benefits.

Dave Friedman - Morgan Stanley

And, just on a sort of broad question either with this program in your preclinical work or otherwise, with serial dosing, have you ever seen through the body develop, you know, an escape mechanism where there is any selective pressure for mutation or are these really sort of resistance prone or resistant drugs.

John Maraganore

Yeah, I mean there's been, there's no pharmacologic tachyphylaxis of the knockdown effect and we've looked at that in extensive animal studies for example and have also looked pharmacologically in PK levels in our liver cancer program where we gave drug for up to 2 years in humans and the PK profile after dose one looks very similar to the PK profile after you know, the end dose in that setting.

And so there is really no evidence for either anti-body formation, no evidence for tachyphylactic type of response. In TTR amyloidosis per se, I mean this is somatic genetic disease. So I can’t think of a molecular mechanism where you would have escape in that type of setting. So, you know, we would expect to get consistent knockdown without any change in terms of the performance of our drug.

Dave Friedman - Morgan Stanley

And then just last, you know assuming success clinically, is this something that you guys are interested in building a commercial infrastructure around? Is it something you feel like is the right size for what you want the company to become and then also US versus Europe how do you think about that?

John Maraganore

So our plans with ALN-TTR02 in the TTR program is to commercialize that product worldwide and you know we may look at Japan and Asia for partner to be determined, but you know rest of world including Brazil with a significant population, Europe where there is a significant population and certainly the US are areas that we intend to fully commercialize ourselves and this is the type of indication that a company like Alnylam, like other companies that have done it before build up commercial infrastructure and in fact you know build significant value and we see it that way and we are committed to doing it that way.

Dave Friedman - Morgan Stanley

So maybe if we can just lastly just talk about the path forward for this program, what types of data are you generating now, how do you foresee the series of studies playing out that would lead to what you think would be a good registration package.

John Maraganore

So we're currently doing the Phase II study which is the two-dose escalation study in ATTR patients. We should have data from that study sometime around this time next year and we'll likely open up an extension study around that protocol that give patients that were enrolled in that study, the opportunity of getting continued dosing going forward. That's a study that we'll also probably introduce other clinical end points including your conductance measurements as well as potential biopsy measurements in that study.

And that will go on for years; that study will go on in concert in parallel with our Phase III study that we expect to start by the end of 2013. So you know Phase III 2013, Phase II data points this time around this time next year and obviously thereafter continuing data coming out of the overall program.

We will also be looking at the FAC indication and looking at Phase II studies that we may open up in the cardiomyopathy indication sometime between now and around this time next year. So it’s going to be a very busy program for the company, there is a lot of different segments of the population that one needs to look at, a lot of opportunity we think for our drug and one that we want to maximize at the end.

Dave Friedman - Morgan Stanley

So may be in the last couple of minutes, we can touch on your hemophilia program which is one of the newer programs for you guys. So if you can just talk about the target, the type of patients you think you can ultimately address and at least what’s your next step with that program?

John Maraganore

Yeah, so it’s an exciting as a person who has been involved in the blood coagulation field with drugs like Angiomax before sort of great to get back to blood coagulation. And this time on the side of hemostasis. So the hemophilia program is targeting the endogenous anticoagulant system in the body. As you know we are all engineered by having procoagulant forces that allows us to clot our blood and then endogenous anticoagulant forces that allows us to prevent thrombosis from occurring.

And in a normal person we are very well balanced, but in a hemophilia patient you have lost your procoagulant forces and your coagulation system. So the approach that we are taking is to basically take the break off, in another words remove the anti-endogenous anticoagulant system by targeting anti-thrombin which is a liver express target chain and therefore essentially normalize trauma generation in a hemophilia patient back to what is like in a normal patient or a normal subject and the real interesting validation of this approach comes from data looking at the co-inheritance of thrombophilic mutations in hemophilia patients.

Mutations like factor V Leiden which in a normal patient makes them incline to clot, but in a hemophilia patient it confers their disease into a mild disease. Okay and so they are human genetic data that really prove that attenuating and dodging this anticoagulant systems in hemophilia can be corrective in the disease. We have a drug that has beautiful sub-cu delivery with our GalNAc-conjugate.

Once weekly dosing gives you 80% knockdown of antithrombin and doses less than 1 mg/kg. We have been able to restore thrombin generation in hemophilia mice. With this program we plan on being in the clinic this time next year with that program and the real objective is to go after the areas of unmet need in the hemophilia patient segment where existing therapies namely replacement factors are inadequate.

And that includes things like inhibitor patients where they have auto antibodies against their replacement factors and are therefore unable to establish adequate prophylaxis and it also includes severe hemophilia patients who require frequent on demand prophylaxis with factor 8 or factor 9 and then more interesting and more recently we have been focusing on some of these other congenital deficiencies of blood coagulation proteins like factor 10, deficiency -- factor 7 deficiency, factor 5 deficiency and these are patients that have nothing.

And so there is an ultra orphan strategy here that we are also looking at quite closely. So the hemophilia program is going to be a exciting one for the company because it will go quickly into a Phase I in patients. We will be able to look at trauma generation in hemophilia patients as a readout to get to the right dose and thereafter we will quickly be able to go in the Phase III studies to look at the corrective effect of the strategy and this is a subcutaneous drug that is the only -- potentially the only available sub-cu drug in the management of these patients. All other drugs for these patients are administered by intravenous infusion.

Dave Friedman - Morgan Stanley

And so you led off with a discussion around the delicate balance of coagulation in the body and so how comfortable are you that you can find the right dose that gives you the right amount of a gene knockdown to give you that right balance again because I could imagine that over shooting in one direction or the other is going to tip the scale in its own problematic way.

John Maraganore

Well, here too we have data from human genetics. Right so there are, you know, congenital deficiencies of anti-thrombin. Okay, heterozygous anti-thrombin deficiency that are really associated with a relatively mild thrombotic phenotype, you know, typically late in life, the venous thromboembolic events that are easily managed.

So that 50% level of knockdown is well established in human and we know that it can be managed in human, but in the context of a hemophilia patient, we know it can be corrective. Alright and so like all things in blood coagulation, whether you're developing an anticoagulant or pro-coagulant in this case, you are dealing with that balance. And you are optimizing your knockdown level of the target chain with your ultimate desire to phenotypic correction that you want to achieve and we're pretty confident that we can do that.

Dave Friedman - Morgan Stanley

And, so we’re just about out of time. I figure since we have someone from finance, maybe if you can just update us quickly on where you guys are cash, any debt and current sort of cash burn guidance for the year?

Mike Mason

We finished the second quarter with $293 million in cash. We have no debt in our guidance for 2012; it is greater than $250 million at yearend, very strong balance sheet to deliver on these programs.

John Maraganore

Any final questions? No. Okay, well thanks very much. Thank you.

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