Alnylam's Q3 Loss Narrower than Expected, Pipeline in Focus - Analyst Blog

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Alnylam Pharmaceuticals, Inc. ( ALNY ) reported a loss of 58 cents per share in the third quarter of 2014, much wider than the year-ago loss of 48 cents per share but narrower than the Zacks Consensus Estimate of a loss of 65 cents per share.

Revenues increased 22% from the year-ago quarter to $10.9 million, beating the Zacks Consensus Estimate of $8.5 million.

Despite the increase in revenues, higher operating expenses led to the wider year-over-year loss.

The Quarter in Detail

Alnylam's revenues in the third quarter included $5.5 million from its collaboration with Takeda Pharmaceutical Company Limited ( TKPYY ), in addition to $5.5 million from its alliance with a couple of other companies.

Research and development (R&D) expenses increased 34.3% to $46.3 million. The increase was attributable to Alnylam's efforts to develop its pipeline. Fourth quarter R&D expenses are expected to go up on a sequential basis.

General and administrative (G&A) expenses increased 46.2% year over year to $9.9 million, primarily due to an increase in general business activities. Fourth quarter G&A expenses are expected to remain consistent sequentially.

Pipeline Update

Alnylam has made significant progress with its pipeline so far. The company continues to enroll patients in a phase III study (APOLLO) on patisiran in transthyretin-mediated amyloidosis (ATTR) patients suffering from familial amyloidotic polyneuropathy (FAP). Results from this study are expected in about two to three years from now. Positive results would allow the company to file for approval in 2017.

Alnylam intends to initiate a phase III study on revusiran (familial amyloidotic cardiomyopathy) by the end of 2014.

Apart from these candidates, Alnylam also made substantial progress with early-stage pipeline candidates like ALN-AT3 (hemophilia and rare bleeding disorders), ALN-AS1 (hepatic porphyrias), ALN-PCSsc (hypercholesterolemia), ALN-CC5 (complement-mediated diseases) and ALN-HBV (hepatitis B virus infection).

2014 Guidance Raised

Alnylam now expects to end 2014 with cash, cash equivalents and total marketable securities in excess of $860 million (old guidance: $825 million).

Our Take

We are pleased with Alnylam's efforts to develop its pipeline. With data read-outs expected in the coming months and through 2015, we expect investor focus to remain on pipeline updates from the company.

Alnylam currently carries a Zacks Rank #2 (Buy). Some better-ranked stocks in the health care sector include AMAG Pharmaceuticals, Inc. ( AMAG ) and Biogen Idec Inc. ( BIIB ). Both carry a Zacks Rank #1 (Strong Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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