The Healthcare Conference. Good morning. I'm Tazeen Ahmad. I'm one of the senior biotech analysts at the bank. It's my pleasure to have our next presenting company with us, Alnylam Pharmaceuticals. Sitting up here on stage with me is Jeff Poulton, who is, of course, Chief Financial Officer. Jeff, welcome back to Las Vegas. Thanks for making the trip.
You know I always make the trip to Vegas. I'm always here for this one.
Yeah
appreciate the invite.
Good.
Yes.
We have to continue the tradition.
Yeah.
Maybe we can start off with a quick overview of the company in case anyone in the room isn't as familiar with Alnylam and its platform.
Yeah, I mean, we're a 25-year-old company. It was founded based on Nobel Prize-winning science. RNAi is really a new modality that we've developed. It was a long haul to figure out some of the delivery challenges with the technology, but over the last six or seven years now, they've figured that out, and we've had a steady stream of products, you know, launching into the market. We've built the commercial side of the business, which I know we're gonna talk a lot about here in the fireside chat. We've transitioned the company from being a loss-making company to now being a profitable company, and we put out new Alnylam 2030 goals earlier this year that kind of provide a picture of where we think we're taking the company over the next five years.
We think there's a lot of top-line growth ahead. Importantly, now that we're profitable and we've got a real nice trajectory on the top line, we have the ability to significantly invest in the pipeline, which we're taking the opportunity to do because we wanna be more than just a TTR company. That's an incredibly important franchise for us. We intend to invest in that, but we wanna be able to grow beyond TTR. This next five years from a pipeline perspective is really about setting up that foundation so that there is growth beyond TTR.
to be excited about here, I think.
We agree. Let's talk about AMVUTTRA, which is the key topic.
Yes.
You launched the product last year. In fact, it was this time last year we were sitting here.
Yes
with early innings of the launch. now we're.
Yep
a few quarters. You know, you have, the sell side had to raise estimates for last year just because of the pace with which.
Yeah
Sales grew.
Yep.
You have now provided 2026 sales guidance.
Yeah
For AMVUTTRA in particular, the range is $4.4 billion-$4.7 billion.
That's total TTR. It's almost all AMVUTTRA.
Most all of it.
Just to be clear. Yep.
Correct.
Yep.
That's healthy growth over what you reported.
Yes
for last year.
Yes.
You talked about very early in the year some of the dynamics that would be impacting 1Q.
Yeah.
Now that 1 Q is reported and behind us, you've reiterated guide.
Yep.
Maybe talk to us about what you're seeing that's giving you confidence?
Yeah
You could at least reiterate guide, given 1Q's growth wasn't necessarily as robust as previous quarters have been.
Yeah. Well, maybe I'll start there just to recap what we reported and what the kind of pushes and pulls were.
Yeah
on Q1, we reiterated and why we're confident in our ability to achieve the guidance. We reported a couple of weeks ago, we did $910 million in revenue for TTR, which is, you know, 150%+ growth year-over-year. We didn't launch until CM in Q2 last year, obviously a huge amount of growth compared to Q1 last year. Relative to the quarterly growth, that's what you're sort of mentioning in terms of lower growth, right? We did, in Q4, we did $134 million of TTR growth compared to Q3, when we were on our year-end call, we talked about Q1 gonna be lower growth than what we delivered in Q4.
Right
for a number of reasons. One, outside the U.S., we were actually guiding to a reduction in revenue in TTR from Q4 to Q1. About $25 million is what we said to expect, and a lot of that was gonna be driven by pricing in Germany. As we launch in new markets outside the U.S., where we've expanded the label to include CM, we are likely adjusting price downward from where it was for PN, right? We've been on the market outside the U.S. in PN for five years. As you bring the price down to launch in CM, it has an impact on your existing PN business 'cause we got one price for the product.
Given the size of the market in Germany and given the price adjustment, the size of the price adjustment, that was what was creating the headwind in Q1 because that price adjustment hit right at the end of the fourth quarter, so really impacted Q1. Now, the result in international in Q1 was a little better than down 25. It was down 7. The impact in Germany was what we expected, so we did better outside of Germany than what we had anticipated, and a couple things. 1 is the CM launch in Japan, which is the first market that we launched in outside the U.S. last, about middle of last year, is going very well, and actually they did better in Q1 than what we had anticipated on around CM volume. That was good.
Then the PN business just, which is still the main driver outside the U.S. as we're just starting to get going in CM. The PN business is performing well, that was a little better than we anticipated. That's why international did a little better than we expected. In the U.S., we grew $59 million in Q1. We had grown $111 million in Q4, when we talked about Q1 being a little bit compressed in terms of quarter-on-quarter growth, there were a couple things that were impacting the U.S. One is insurance reauthorizations, which is pretty typical seasonality.
for these high-priced meds. We did see that play out if we looked at demand, meaning shipments to patients for, to get the injection, as well as start forms, which is kind of the prescription, the start to get patients on therapy. It was slower early in Q1 than it was as we were exiting Q1. We do think the fact that the offices had some administrative burden earlier in the year was impacting things. The other thing that we highlighted for the U.S. is just the way the product gets ordered and shipped and revenue booked. We have a closed distribution network where we've got one major distribution partner that about 80% of the volume flows through. They order every Monday, every week on a Monday. Product ships Tuesday, revenue books on Wednesday.
To the extent that there's a different number of Wednesdays when you're comparing growth across periods, that can have an impact. It just so happened with the way the calendar fell that Q4 last year had 14 Wednesdays and Q1 had 12. All that I would say generally played out like we expected. Now to your point, we reiterated the guidance. To hit the midpoint of the guidance, we need to average $150 million of growth a quarter the rest of the year. We just did $50. We're at $52, right? There needs to be a step-up in growth for us to achieve that. Ex-U.S., like, we're not gonna have this dynamic that we had in Germany the rest of the year.
We absolutely expect international's gonna be contributing to that $150 million in growth on a quarterly basis through the rest of the year. That'll be beneficial to us. In the U.S., we definitely expect a step up in growth. I think, first of all, I would say the foundation that we've established in the last, you know, 12 months or so, particularly around access and logistics around buy and bill, we've really reduced the friction. I think first from a payer perspective, we've got about 90%-plus of patients that can access AMVUTTRA first line, which was a huge debate as we were coming into the launch. There's no friction there in terms of patients getting access to the product when the doctors decide to put them on AMVUTTRA.
Patients, you know, the majority of the patients have $0 in out-of-pocket co-pay, so that's not a particular burden that's preventing access to the medicine. As it relates to buy and bill on the provider network side, we've done a very good job in the health systems that treat a lot of these patients to get AMVUTTRA on formulary. When the doctors write it, the product gets filled, and we've also created a pretty broad network of third-party infusion clinics, which is really important for a buy-and-bill drug. We've got 2,000 clinics that patients could access around the U.S., and that puts most patients within 10 miles of an infusion clinic.
Where that's important is if you have a doctor, let's say, that's in the community that's not experienced with buy and bill, and they don't want to do it, they don't have to buy and bill. They refer the patient to the clinic to get the drug administered. They can still treat the patient. We've done that very well. That foundation is really strong. What we have to do now, obviously now to drive performance for the rest of the year is drive demand, right? One of the things that we talked about on the call is what we're seeing so far a year into this is when you get a physician to try AMVUTTRA for the first time, it leads them to prescribing more AMVUTTRA.
That doesn't matter if they start in second line or if they start in first line, they use more of the product. If we look across the physician universe that's using AMVUTTRA today, we actually feel very good about the share that we have there, but we want more physicians to use AMVUTTRA, right? This is obviously a market that we've launched into in the last year, where Pfizer was the only game in town for five or six years, and that has been the standard of care. It takes time to
Yeah
to change that. From a tactical perspective, commercially, we are really focused now on getting to physicians that are not writing AMVUTTRA at all today and doing the hard work to get them to experience it, because we think if we can get them to use it for the first time, they'll use more of it. That's really gonna be critical to the performance of the business for the balance of the year. That's something I think that we will report on quarterly, is that prescriber base and how it's expanding, because that's a big focus for us right now.
Okay. Thanks for all of that color. We're halfway into this quarter.
Yeah.
Can you share any qualitative feedback on what you're seeing?
No, I mean, I'm not gonna comment specifically on Q2. I do think the things that I just highlighted in terms of our expectations of what's gonna drive stronger growth of, you know, the rest of the year are things that we remain confident in.
Okay
specifics to this point on Q2 performance.
It's more based on the confidence that you have in reiterating.
Yeah
guidance that that's the reason for the question.
Yeah, I mean, we remain confident in our ability to achieve the guidance, which is why we reiterated. Obviously, Q2 is gonna be important. We'll be halfway through the year. We need to see that growth inflection from Q1, and I'm sure people are gonna be very interested to see that.
Do you expect Q1 to have similar dynamics on a go-forward basis?
Probably some of these things on like the insurance reauthorization point is I think is an issue. That, that's a bit of a learning, probably just because the volumes are more than when we were in PN only.
Yeah
became a little more apparent what the impact on the business was. That's something that I think that will be something every year that we'll see. You know, ex-US, as we get launched in all markets for CM, that dynamic that we had in Germany, that's not going to recur, right? We're launched in Germany now, the U.K., and Italy, and Japan. The other major ex-US markets that we're still working on to open up access are France and Spain. They'll either be by the end of the year or early next year. We'll have a lot of that pricing ex-US dynamics behind us, and it will really be about driving volume on a go-forward basis.
In general, what type of price discount do you have to take ex-U.S.?
It differs by market, right? Depends where the PN price is. You know, look, the way this works in most markets outside the U.S. is they will look at your package of clinical data. They'll compare it to the products that are in the market for the same indication. They'll assess whether or not the data is, you know, looks like better efficacy, similar efficacy, and then they'll obviously benchmark your price to those existing products. Typically, we're launching somewhere around the tafamidis price in these markets.
Yeah.
That's lower than where we were. Again, we were in, you know, a much rarer, much smaller part of the market in PN. Price is coming down, but it really does differ market by market, depending on where the PN price and what the benchmark is for CM. Generally speaking, it, you know, we're adjusting downward as we launch in CM.
Okay. This market is getting more crowded.
Yep
you were the second to launch. There's Attruby, which is the another stabilizer.
Yep.
I think during 1Q, there was a lot of conversations, at least with investors, about the fact that it looked like it continued to increase its momentum throughout that quarter. Can you talk about potential differences relative to how that gets reimbursed versus how AMVUTTRA gets reimbursed as to why that's not necessarily the way of comparing?
Yeah, I mean, I don't know that I'm gonna talk a lot about Attruby and their performance. It may or may not have impacted that. I mean, I think they've done well. I think the launch to me looks consistent in terms of the amount of revenue growth that they've had quarterly. I don't know that I'm gonna get into a sort of a comparison of reimbursement dynamics in Q1 that may have been different for them, 'cause I'm not able to speak to that.
Okay. if you think about the next data catalyst.
Yeah
coming to the space, that's gonna be for, Ionis and AstraZeneca.
Yeah.
They have a silencer. They were the third ones to go into pivotal. They took their time to design a big study.
Yeah. I think they learned a little bit from the others that went before them.
The other. Yep.
Yeah. Yeah.
For sure. Relative to HELIOS-B, they had a bigger study.
Much bigger.
It was, They were able to stratify based on different patient populations. I think people are particularly interested.
Yeah
in seeing what the effect will be when you add a silencer on top of a stabilizer.
Yes.
Can you talk about the different scenarios and the outcomes you think would be impactful for Alnylam?
Yeah
the blue sky, it looks good, and it looks good on all the subgroups.
Yeah.
How should we interpret that as to potential, if at all, pressure on?
Yeah
m-m-mVutra?
Yeah, I mean, I think our expectations are that's going to be a successful study. As you said, it's a much larger study than HELIOS-B was, so there's a powering benefit there. I mean, they're more than 1,400 patients. We were 650 patients. You're right, my understanding is the design of this study has about half of those 1,400 patients are on background TAF, so that's going to be a pretty robust data set and combination. In comparison, in HELIOS-B, we had about 40% of the patients that were on background TAF at the start of the study, so 250. They got a much larger data set there, so the powering's different than what we had.
Look, I think there is a lot of discussion about that, and if they hit in the overall study, which we think they will, then they hit in that subgroup as well, and they have a statistically significant result there. Is that gonna give them a benefit commercially? We don't think so. We actually do have data in combination in our label. Because that was a pre-specified subgroup, and the results were consistent in that subgroup, like they were across all subgroups that were studied in HELIOS-B. Physicians, some physicians are using it in combination today, likely as a result of the data that we have in the label.
If they hit a statistically significant result in that study, our view is that will be sort of viewed as a class benefit, right? We would get some benefit from that. There's not a huge amount of combination use going on today. There's some, that's largely because payers are have policies in place, certainly on the commercial side and the Medicare Advantage part of the market. They all have policies that restrict combination use, right?
Yeah.
To manage costs. In the fee for service part of the market, for us, which is, you know, 40%-50% of our volume, there are no policies that are written to restrict it. That's probably where we're getting some combination use reimbursed today, but we think the broader unlock for the commercial or for the combination opportunity is when TAF goes generic, and now we've got more clarity on the timing of that. Obviously, with the settlements that Pfizer's recently announced, that looks like that'll be middle of 2031.
that big unlock occurs, and that's when I think there's gonna be a different dynamic in the market likely in how these products are used together, right? We can talk a little bit more about that too in terms of some other things that we're working on that might also position us perhaps even more strongly than the way AMVUTTRA's positioned for combination use down the line.
We've done survey work on this. It's pretty consistent that doctors feel the best outcome over time is to combine stabilizers.
Yeah
with silencers.
Yep.
As you've mentioned, I think the feedback has generally been that, you know, silencers are probably not that different from each other, that if a study ends up working for one silencer, the interpretation would be that you would have similar efficacy.
Yep
seen across, you know, all drugs in that class. We agree on the view that, and this is probably going to be in the 2030s, and after that you see an increase in combination use.
Yeah.
To the point you just made, maybe we can talk about some of the efforts that you're undertaking now.
Yeah
the company well for that later on.
Yeah. You know, look, we view ourselves as a leader in TTR, and we're investing in this franchise as, I think as a leader would do. We've got a 3rd generation product that's in the clinic right now, 2 phase II studies, one for PN and one for CM, and this is nucresiran, right? This drug has the promise of being a better drug than AMVUTTRA, and hopefully better than WAINUA as well. In terms of knockdown, we see in the phase I study that we get to 95% knockdown. AMVUTTRA's more like mid-80s. Actually the spread, the variability around that 95% is tighter than the variability around the 85%. We know particularly on the PN side, when we get deeper knockdown, it leads to better efficacy in the disease.
We're hopeful that this study, because of the deeper knockdown, is gonna show better efficacy. That's kind of point 1. Point 2 with this product is it's got longer duration. This is a once every 6 month sub-Q administration. AMVUTTRA's once a quarter. WAINUA is once a month, right? That would give us a real convenience advantage from a patient perspective, and we absolutely know patients would much prefer fewer injections than more. That would be positive to uptake. Lastly, from an economic perspective for us, this is pretty meaningful that there's no royalty burden on this product like we have on AMVUTTRA, which is close to 30%, given that the-
there's a tiering of 15%-30%, but given the tiering, the size of the commercial opportunity, like the weighted average is gonna be pretty close to 30%. Just Touch on the, what that could mean for us, you know, economically and sort of margin-wise longer term. We've guided it with our Alnylam 2030 set of goals to have operating margins around 2030, or I'm sorry, around 30% across the period out to 2030. That's weighed down by a gross margin because of the royalty we own on AMVUTTRA. That's about 75%.
Right
across the period. If nucresiran delivers on this promise, right, of having better efficacy, more convenient, and we get that into the market, that's going to be a very attractive profile, and I think it's going to drive nice uptake. That really then unlocks a much, a lower gross margin and more significant operating margin post 2030. We've talked about, we see a clear path to mid-40s on operating margins. This is an important product for us. Let me talk a little bit about, again, the study, the CM study that we're running for that program, nucresiran. It's an outcome study, and one of the things that we did with that study, and this is frankly learning from HELIOS-B, was rather than a time-bound endpoint, we've got an event-driven endpoint there, right?
That we sort of were more comfortable with the powering in the study as a result of that because patients are becoming diagnosed earlier and earlier, kind of less advanced in the disease. Event rates are lower. We've got an event-driven endpoint. I think that makes us feel good about the powering. One of the things that we just announced on the Q1 call is that we've decided to increase the size of that study. We initially announced it about a 1,250 patient study, in the protocol we had given ourselves the option to upsize that by 500, we chose to do that and announced that on the call.
The reason we announced it when we did is because the enrollment is going very, very well on that study, and we didn't announce it and make this decision pretty soon. That study was gonna complete enrollment very soon to 1,250. We've decided to upsize the study. That's mostly around managing time risk with the study because then it's an event-driven study, and the patients that we're enrolling in the study are milder, similar to HELIOS-B, maybe just a little bit milder, but there's uncertainty around event rates and how long will it take once you get it fully enrolled to hit that number of you know, endpoints. Having more patients in the study obviously gives you an opportunity to accrue more events faster.
We feel actually, even though we've upsized the study and we've got a little bit more enrolling to do, our confidence level in Alnylam 2030 is higher and that, now that we know when TAF is gonna go generic, to have that product in the market that will have a huge amount of combination data. Like, that's largely gonna be a combination study.
We'll have enough monotherapy, you know, patients in the study as well to have that part of the label, but that's mostly a 1,750 patient gonna be a combination study. We'll have that data. We'll have, you know, we're assuming that the study rolls, you know, the events accrue the way we think they will. We'll have that product in the market before tafamidis goes generic now, given the timing of that. If this becomes a largely a combination market, that's good that we're gonna have that product positioned and in the market before TAF goes generic. We're excited about that, and I think that was a meaningful change. I don't know that the market completely understood what we did and why, so I wanted to be clear about that.
That's mostly about managing timeline risk in the study and getting to the you know, the number of events that we need.
Yeah
to have to complete the study. I think the fact that it's enrolling as rapidly as it is is a very good sign.
Okay. You talked about, you know, making this available and that could be attractive for patients.
Yes.
How are you thinking about, you know, switching patients from AMVUTTRA to nucresiran when it does come out?
Yeah.
How would the dynamics of that work?
I mean, I talked about the potential for the profile. You know, this is a progressive fatal disease.
better than the existing silencers that are in the market, I think that's gonna drive uptake. Added to the fact that if it's a 2 times a year rather than 4 times a year or 12 times a year, I think it's gonna drive, you know, it's gonna be an attractive profile for patients, and I think that'll drive a lot of uptake for us.
Okay. Maybe another question about near-term competition.
Yeah.
Assuming that, Astra has positive data this year.
Yes
they apply, and then they launch next year, what is the concern that they might try to use price as a way of trying to gain traction in the market?
I mean, today they're a Part D product. They're not in the market for CM. They're in the market for PN. In the U.S., they're actually priced higher than we are.
They're close to 10% higher. We're already competing against 2 Part D products, both stabilizers, and they're both at a lower price point than we are today. I talked earlier about, you know, access for us. That fact that there's 2 products on the market that are at a lower price point has not impacted our ability to get AMVUTTRA to patients on a first-line basis. More than 90% of patients have access to it. I don't think having a 3rd Part D product that's at a lower price is actually gonna change the dynamics that we're dealing with today and meaningfully impact access to AMVUTTRA. Again, we feel comfortable with the access dynamics at this point in time and don't think that's gonna change dramatically when they launch.
Okay. On discontinuations.
Yeah
are you tracking in line to what you would expect?
Yeah, this is one of the things I believe that's underappreciated in the value of our medicine. We've got, you know, adherence and compliance on our drug that are more than 90%, generally speaking, the biggest reasons why patients discontinue taking the therapy is because they pass away, right?
This is a fatal disease ultimately. I think when you compare that just in general to patients that are on products that require them to take daily pills or you know, in the case of one of our competitors, twice a day to take pills, patients even with these kinds of diseases are not compliant, right? We have the benefit of very good compliance. I think partly because it's fairly convenient, once a quarter.
physician visits that they have. I think one of the things that we also do very well is we've got a patient services hub that supports these patients and is actively working with patients to make sure that on a quarterly basis, that they're getting access to the medicine that they need. Ultimately, that can lead to better outcomes, just being compliant. I think that's a big advantage for us, and that's something that we're going to continue to really focus on to make sure the patients are staying on the drug. Obviously, patients staying on drug and getting it every quarter also has a beneficial impact to us in terms of consistent revenue.
Okay. Let's talk about the rest of the pipeline.
Yeah.
maybe just remind us of what data updates to expect from the earlier pipe for the
Yeah. We've got 3 readouts in the second half of the year that are worth paying attention to. Maybe we'll start with our Huntington program. This is a program that's in a phase I study that we're developing in partnership with Regeneron. We've got an exon 1 targeting approach here. We're running a phase I study that's primarily looking at safety and PK/PD, like how much knockdown can we get. We think for a variety of reasons, we may have the right approach here to treat this disease. What we really wanna learn from this study frankly is what level of knockdown can we get, hopefully safely, and form a dose that we would then take forward into a study that would really be looking at efficacy.
We'll have that initial data in that program later this year. Our bleeding disorder program that's targeting plasminogen. This is a program that we think could ultimately be a pipeline and a product type opportunity where we have the ability across a variety of bleeding disorders to improve clot stability.
with the genetics on this particular target, without increasing the risk of thrombosis. There's hundreds of bleeding disorders that very few of have treatments today. The first indication that we've got a phase II ongoing right now is in a disease HHT. I'm not gonna pronounce it 'cause I'll get it wrong, but that'll have a phase II readout that's a proof of concept readout. We'll be looking at the number of nosebleeds in that study, so we'll have that in the second half of the year. In addition to, we have an ongoing phase I study in healthy volunteers. We'll have some additional data.
We're actually expecting to start a second indication phase II with that same therapy this year. We'll actually do an R&D type webinar on this program later in the second quarter. Pay attention to that. We'll put some news out on that. I think this is an important one that the market probably isn't as educated on as we would like them to be, so we're gonna spend some time talking about the product as well as the market opportunity that we see for that later in Q2.
Do you know how many Sorry to interrupt you, but how many HHT patients are there?
I think in the U.S. from a prevalence perspective, the number's about 70,000. Not all those patients aren't diagnosed and treated today. There are actually no on-label treatments for this disease today. This is one of the things I think that we'll educate on the webinar in terms of what's the burden of treatment associated with this disease. It's a pretty horrific disease in terms of impact on quality of life. We think it's an interesting opportunity. More to come on that in the second quarter. The last thing I think from a readout perspective is our initial obesity program where we're targeting adipose tissue to go after ACVR1C. Again, this'll be early phase I data where we'll get PK/PD.
information, we'll have that by the end of the year as well.
How big is that opportunity?
I mean, obesity, you know, is huge, right? This is lots of questions about some of these targets, and some of the.
Yeah
competitors have these about how much monotherapy weight loss can you get. How would you position these? Would these be monotherapy? Would they be combination? I think more to come on that in terms of our perspective on that.
Okay. Then last question.
Yeah
cash.
On, what was the.
The balance sheet.
Oh, yeah.
Talk about that.
I mean, The good thing is I don't have to think about that quite as much.
Yeah
as I used to. We, you know, we ended the year with around $3 billion.
in cash. We're going to start adding cash to the balance sheet as we go now that we're profitable, which is, you know, a nice position to be in.
Yeah
start to come up more and more.
Yeah
start to see a bigger cash balance, We've talked about the priorities right now are 100% TTR launch and continuing to invest appropriately behind that to drive demand. That's a priority. Then on innovation, certainly internal innovation.
is the priority, we have talked about starting to add external innovation into the mix as well. I do think business development is an area that we will focus, and we will start to spend some dollars on external innovation as well. Likely earlier stage things. I think in particular one of the areas that we're looking for some help externally is on delivery, right?
We're trying to get to 10 tissues by 2030. There's a lot of interesting innovation going on across the industry in delivery. So that could be an area that we would invest from an external innovation standpoint.
Okay. That's potentially near term that if you see something.
Yeah. I mean, we're building the BD muscle now. We've hired a new head of BD in the last six months, she's helping us build that team internally and sort of build the muscle on how you do these things. We're starting down that path.
Okay. Perfect. With that, we're out of time. Jeff, thank you-
Thank you.
for some time with us.
Appreciate it.
Thanks everyone for joining.