Alnylam Pharmaceuticals Reports Fourth Quarter and Full Year 2013 Financial Results and Highlights Recent Period Activities

  Alnylam Pharmaceuticals Reports Fourth Quarter and Full Year 2013 Financial
  Results and Highlights Recent Period Activities

 – Announced Major Business Transactions Including Transformational Alliance
  with Genzyme for RNAi Therapeutics as Genetic Medicines and Acquisition of
            Merck RNAi Assets and Sirna Therapeutics Subsidiary –

– Initiated APOLLO Phase 3 Study with Patisiran (ALN-TTR02) for the Treatment
 of Transthyretin (TTR)-Mediated Amyloidosis (ATTR) in Patients with Familial
                      Amyloidotic Polyneuropathy (FAP) –

  – Initiated Phase 2 Study with ALN-TTRsc in ATTR Patients with TTR Cardiac
                                Amyloidosis –

  – Initiated Phase 1 Study with ALN-AT3 for the Treatment of Hemophilia and
                       Other Rare Bleeding Disorders –

 – Advanced Additional “Alnylam 5x15” Programs Toward Clinical Development –

– Maintained Strong Balance Sheet with $351 Million in Cash and Expects to End
                2014 with Greater than $825 Million in Cash –

Business Wire

CAMBRIDGE, Mass. -- February 13, 2014

Alnylam Pharmaceuticals, Inc. (Nasdaq: ALNY), a leading RNAi therapeutics
company, today reported its consolidated financial results for the fourth
quarter and full year 2013, and company highlights.

“The full year 2013 and the first weeks of 2014 were transformational for
Alnylam and our continued efforts to advance RNAi therapeutics as a whole new
class of medicines. We believe our recent alliance with Genzyme is a game
changer in our efforts to bring RNAi therapeutics to patients with rare
diseases as potential breakthrough genetic medicines. The new collaboration
crystallizes Alnylam’s strategy to develop and commercialize our products in
North America and Western Europe while Genzyme advances our products in the
rest of the world. It also solidifies our balance sheet, enabling an increased
investment in an expanded number of RNAi therapeutic programs while securing a
cash runway that we believe provides us with financial independence to develop
and launch multiple products,” said John Maraganore, Ph.D., Chief Executive
Officer of Alnylam. “We’re also very pleased with our continued execution on
our ‘Alnylam 5x15’ product strategy over the last several months, including
initiation of new Phase 1, 2, and 3 clinical trials across three distinct
programs, with multiple data read-outs expected in 2014. Specifically, we
initiated our APOLLO Phase 3 trial with patisiran in ATTR patients with FAP;
as the company’s first Phase 3 study, this is a very significant milestone in
our history and also for the entire field of RNAi therapeutics. We’ve also
advanced ALN-TTRsc – our first GalNAc-siRNA conjugate program to enter
clinical development – into a Phase 2 trial in patients with TTR cardiac
amyloidosis, with results expected later this year. We have also now started a
Phase 1 clinical trial of ALN-AT3, an RNAi therapeutic targeting antithrombin
for the treatment of hemophilia and rare bleeding disorders. ALN-AT3 is our
second GalNAc-siRNA conjugate program to enter clinical testing, and we expect
to share initial data from this Phase 1 trial later this year. Overall, we
believe that our recent business and clinical accomplishments strengthen our
efforts to build a leading, independent biopharmaceutical company that
delivers value to our shareholders.”

“In addition to highlights noted above, we also made significant advancements
with other pipeline programs and in other business development efforts.
Specifically, we advanced Development Candidates for two ‘Alnylam 5x15’
programs in this past quarter: ALN-AS1 for the treatment of hepatic
porphyrias, and ALN-PCSsc for the treatment of hypercholesterolemia. We also
presented promising data with ALN-CC5 for the treatment of complement-mediated
diseases, and expect to have a Development Candidate selected in early 2014.
Across these three programs, we expect to file investigational new drug
applications for two in late 2014 and one in early 2015. Further, we’re
pleased to have recently updated and expanded our original ‘Alnylam 5x15’
pipeline guidance, where we now expect to end 2015 with six to seven programs
in clinical development, including at least two programs in Phase 3 trials,
and five to six programs having achieved human proof-of-concept results,” said
Barry Greene, President and Chief Operating Officer of Alnylam. “Regarding
additional progress in our business development efforts, we were pleased to
announce an agreement with Merck to acquire their RNAi assets, including their
Sirna Therapeutics subsidiary. We believe that this acquisition will
complement and extend our own progress and continued focus on RNAi
therapeutics, including our efforts with GalNAc-siRNA conjugate technologies.
All told, our recent progress on pipeline advancement and business development
provide what we believe to be an unprecedented foundation for value creation
through Alnylam’s continued efforts in advancing important medicines to
patients.”

Cash, Cash Equivalents and Total Marketable Securities

At December 31, 2013, Alnylam had cash, cash equivalents and total marketable
securities of $350.5 million, as compared to $226.2 million at December 31,
2012.

Net Loss

The net loss according to accounting principles generally accepted in the U.S.
(GAAP) for the fourth quarter of 2013 was $32.4 million, or $0.51 per share on
both a basic and diluted basis (including $5.4 million, or $0.09 per share of
non-cash stock-based compensation expense), as compared to a net loss of $62.2
million, or $1.20 per share on both a basic and diluted basis (including $2.7
million, or $0.05 per share of non-cash stock-based compensation expense), for
the same period in the previous year. For the year ended December 31, 2013,
the net loss was $89.2 million, or $1.45 per share (including $20.7 million,
or $0.34 per share of non-cash stock-based compensation expense), as compared
to a net loss of $106.0 million, or $2.11 per share (including $12.4 million,
or $0.25 per share of non-cash stock-based compensation expense), for the same
period in the previous year. The decrease in net loss for the quarter and year
ended December 31, 2013 compared to the prior periods was due primarily to a
one-time charge of $65.0 million related to the restructuring of the company’s
licensing agreement with Tekmira Pharmaceuticals Corporation in 2012.

Revenues

Revenues were $10.8 million for the fourth quarter of 2013, as compared to
$8.5 million for the same period last year. Revenues for the fourth quarter of
2013 included $5.5 million of revenues from the company’s alliance with Takeda
Pharmaceuticals Company Limited, $1.4 million in revenues from the company’s
collaboration with Monsanto, $1.3 million related to the company’s
collaboration with The Medicines Company and $2.6 million of expense
reimbursement, amortization, and/or license fee revenues from research reagent
and services licensees, and other sources. The increase in revenues in the
fourth quarter of 2013 compared to the prior period was due to revenues under
the Medicines Company collaboration which was entered into in the first
quarter of 2013. Revenues were $47.2 million for the year ended December 31,
2013, as compared to $66.7 million for the prior year. Revenues for the year
ended December 31, 2013 included $22.0 million of revenues related to the
company’s collaboration with Takeda, $9.7 million of collaboration revenues
related to the company’s former alliance with Cubist, $5.6 million of revenues
related to the company’s collaboration with Monsanto, $4.6 million of revenues
related to the company’s collaboration with The Medicines Company, and $5.3
million of expense reimbursement, amortization, and/or license fee revenues
from research reagent licenses, and other sources. Net revenues decreased for
the year ended December 31, 2013 as compared to the year ended December 31,
2012 due primarily to the completion of the company’s remaining performance
obligations under the Roche/Arrowhead alliance in August 2012.

Research and Development Expenses

Research and development (R&D) expenses were $32.1 million in the fourth
quarter of 2013, which included $3.3 million of non-cash stock-based
compensation, as compared to $21.7 million in the fourth quarter of 2012,
which included $1.7 million of non-cash stock-based compensation. The increase
in R&D expense for the fourth quarter of 2013 compared to the fourth quarter
of the prior year was due to the increase in license fees related to the
initiation of the Phase 3 trial of patisiran and an increase in compensation
related expenses, including stock-based compensation. R&D expenses were $113.0
million for the year ended December 31, 2013, which included $14.4 million of
non-cash stock-based compensation, as compared to $86.6 million for the prior
year, which included $8.0 million of non-cash stock-based compensation. The
increase in R&D expenses for the year ended December 31, 2013 as compared to
the prior year was due primarily to higher clinical trial and manufacturing
expenses related to the company’s patisiran, ALN-TTRsc, and ALN-AT3 programs.
In addition, compensation related expenses including stock-based compensation
increased during the year ended December 31, 2013 as compared to the year
ended December 31, 2012. R&D expenses are expected to increase significantly
in 2014 as the company continues to develop its pipeline and advance its
product candidates into clinical trials.

General and Administrative Expenses

General and administrative (G&A) expenses were $8.3 million in the fourth
quarter of 2013, which included $2.1 million of non-cash stock-based
compensation, as compared to $10.2 million in the fourth quarter of 2012,
which included $1.0 million of non-cash stock-based compensation. G&A expenses
were $27.2 million for the year ended December 31, 2013, which included $6.3
million of non-cash stock-based compensation, as compared to $44.6 million in
2012, which included $4.3 million of non-cash stock-based compensation. The
G&A expenses for the quarter and year ended December 31, 2013 as compared to
the prior year periods decreased primarily due to decreased consulting and
professional services expenses related to business activities, primarily legal
activities. G&A expenses are expected to increase slightly in 2014.

Investment in Regulus Therapeutics

Equity in loss of joint venture was zero for the fourth quarter and year ended
of 2013 and $0.9 million for the fourth quarter of 2012 and $4.5 million for
the year ended December 31, 2012, related to the company’s share of the net
losses incurred by Regulus. Beginning in the fourth quarter of 2012, the
company began accounting for its investment in Regulus at fair value by
adjusting the value to reflect fluctuations in Regulus’ stock price each
reporting period. At December 31, 2013, the fair market value of the company’s
investment in Regulus was $45.5 million as compared to $38.7 million at
December 31, 2012.

Benefit from Income Taxes

The company had a provision for income taxes of $3.0 million for the fourth
quarter of 2013 as compared to a benefit for income taxes of $10.6 million for
the fourth quarter of 2012. For the year ended December 31, 2013, the company
had a benefit from income taxes of $2.7 million as compared to $10.6 million
for the respective period in 2012. The income tax benefit is associated with
the corresponding change in value of the company’s investment in Regulus that
the company recorded in other comprehensive income, net of tax.

2014 Financial Guidance

Alnylam expects that its cash, cash equivalents, and total marketable
securities balance will be greater than $825 million at December 31, 2014.

“Alnylam continues to maintain a solid balance sheet, with approximately $350
million in cash at year-end 2013. Upon the close of our Genzyme alliance,
Alnylam will have over $1 billion in cash on a pro forma basis,” said Michael
Mason, Vice President, Finance and Treasurer of Alnylam. “As for financial
guidance this year, we expect to end 2014 with greater than $825 million in
cash. We believe that this balance sheet will allow us to invest in a broad
pipeline of genetic medicines and to maintain financial independence through
to multiple product launches.”

Fourth Quarter 2013 and Recent Significant Corporate Highlights

Key “Alnylam 5x15” Program Highlights

  *Advanced Patisiran (ALN-TTR02) into Phase 3 for the Treatment of
    Transthyretin (TTR)-Mediated Amyloidosis (ATTR) in Patients with Familial
    Amyloidotic Polyneuropathy (FAP).

       *Initiated APOLLO Phase 3 Trial with Patisiran. The APOLLO trial is a
         randomized, double-blind, placebo-controlled, global study designed
         to evaluate the efficacy and safety of patisiran in up to 200 ATTR
         patients with FAP. The primary endpoint of the study is the
         difference in the change in neuropathy impairment score, or “mNIS+7,”
         between patisiran and placebo at 18 months. Secondary endpoints
         include: Norfolk Quality of Life-Diabetic Neuropathy (QOL-DN) score;
         NIS-weakness; modified BMI; timed 10-meter walk; and COMPASS-31
         autonomic symptom score. Patients will be randomized 2:1,
         patisiran:placebo, with patisiran administered at 0.30 mg/kg once
         every three weeks for 18 months. All patients completing the APOLLO
         Phase 3 study will be eligible to enroll in a Phase 3 open-label
         extension (OLE) study. In addition, Alnylam announced that the U.S.
         Food and Drug Administration (FDA) granted Fast Track designation to
         patisiran for the treatment of FAP.
       *Continued Dosing in Phase 2 OLE Study with Patisiran. The Phase 2 OLE
         study is an open-label study where patients that were enrolled in the
         patisiran Phase 2 study are eligible to receive continued dosing. The
         primary objective of this study is to evaluate the long-term safety
         and tolerability of patisiran administration. The study will also
         measure a number of clinical endpoints, which are the same as those
         measured in the APOLLO Phase 3 study. The company expects to present
         data from the Phase 2 OLE study approximately once a year, with an
         initial data report in late 2014.
       *Reported Positive Results from Phase 2 Trial in FAP Patients. At the
         IXth International Symposium on FAP (ISFAP) in November 2013, Alnylam
         presented results showing that multiple doses of patisiran led to
         robust and statistically significant knockdown of serum TTR protein
         levels of up to 96%, with mean levels of TTR knockdown exceeding 85%.
         Knockdown of TTR, the disease-causing protein in ATTR, was found to
         be rapid, dose dependent, and durable, and similar activity was
         observed toward both wild-type and mutant protein. In addition,
         patisiran was found to be generally well tolerated in this study.

  *Initiated Phase 2 Clinical Trial with ALN-TTRsc, a Subcutaneously
    Administered RNAi Therapeutic Targeting TTR for the Treatment of ATTR
    Patients with Cardiac Amyloidosis. The pilot Phase 2 trial is aimed at
    evaluating the tolerability and preliminary clinical activity of ALN-TTRsc
    in approximately 15 patients with familial amyloidotic cardiomyopathy
    (FAC) – which is caused by autosomal dominant mutations in the TTR gene –
    or senile systemic amyloidosis (SSA) – which is caused by idiopathic
    accumulation of wild-type TTR in the heart. In addition, the study will
    assess preliminary clinical activity as measured by knockdown of serum TTR
    levels and additional exploratory tests, such as cardiac imaging
    (including echocardiography and cardiac MRI), circulating cardiac
    biomarkers (NT-proBNP and troponins T and I), 6-minute walk test, New York
    Heart Association (NYHA) classification, and measures of heart failure
    symptoms and quality of life (Kansas City Cardiomyopathy Questionnaire and
    EQ-5D QOL). The company expects to present data from the Phase 2 trial in
    late 2014. Patients completing the Phase 2 trial will be eligible to
    participate in an OLE study for further assessment of general tolerability
    and clinical activity with long-term dosing; the ALN-TTRsc Phase 2 OLE
    study is expected to be initiated in mid-2014. Assuming positive results,
    Alnylam expects to begin a Phase 3 trial in TTR cardiac amyloidosis
    patients by the end of 2014.
  *Initiated Phase 1 Clinical Trial with ALN-AT3, a Subcutaneously
    Administered RNAi Therapeutic Targeting Antithrombin (AT) for the
    Treatment of Hemophilia and Rare Bleeding Disorders (RBD). The Phase 1
    study is being conducted in the U.K. as a single- and multi-dose,
    dose-escalation study comprised of two parts. Part A will be a randomized,
    single-blind, placebo-controlled, single-dose, dose-escalation study,
    enrolling up to 24 healthy volunteer subjects. The primary objective of
    this part of the study is to evaluate the safety and tolerability of a
    single low dose of ALN-AT3, with the potential secondarily to show changes
    in AT plasma levels at sub-pharmacologic doses. Part B of the study will
    be an open-label, multi-dose, dose-escalation study enrolling up to 18
    people with moderate to severe hemophilia A or B. The primary objective of
    this part of the study is to evaluate the safety and tolerability of
    multiple doses of subcutaneously administered ALN-AT3 in hemophilia
    subjects. Secondary objectives include assessment of clinical activity as
    determined by knockdown of circulating AT levels and increase in thrombin
    generation at pharmacologic doses of ALN-AT3; thrombin generation is known
    to be a biomarker for bleeding frequency and severity in people with
    hemophilia (Dargaud, et al., Thromb Haemost; 93, 475-480 (2005)). The
    company expects to present initial data from the Phase 1 study in late
    2014. At the 55^th Annual Meeting of the American Society of Hematology
    (ASH) held in December 2013, new pre-clinical data were presented
    demonstrating that ALN-AT3 has an expanded therapeutic index in the
    hemophilia setting and can correct the activated partial thromboplastin
    time (aPTT), a measure of blood coagulation, in mice with hemophilia A.
  *Advanced ALN-CC5, a Subcutaneously Administered RNAi Therapeutic Targeting
    Complement Component C5 for the Treatment of Complement-Mediated Diseases.
    ALN-CC5 is a subcutaneously administered RNAi therapeutic targeting
    complement component C5 for the treatment of complement-mediated diseases,
    such as paroxysmal nocturnal hemoglobinuria (PNH), atypical
    hemolytic-uremic syndrome (aHUS), myasthenia gravis, neuromyelitis optica,
    amongst many others. At the ASH Meeting held in December 2013, the company
    presented pre-clinical data demonstrating that subcutaneous administration
    of ALN-CC5 in non-human primates (NHPs) led to an up to 98% knockdown of
    serum C5 and an up to 94% inhibition of serum hemolytic activity. This
    level of complement activity inhibition exceeds the 80% inhibition
    threshold that has been validated as being associated with clinical
    benefit in patients with PNH (Hillmen et al., N. Engl. J. Med. (2004)
    350:552-559). The company expects to identify its final Development
    Candidate for ALN-CC5 in early 2014 and to file an Investigational New
    Drug (IND) application or IND equivalent in late 2014 or early 2015.
  *Selected Development Candidate for ALN-AS1, a Subcutaneously Administered
    RNAi Therapeutic Targeting Aminolevulinate Synthase-1 (ALAS-1) for the
    Treatment of Hepatic Porphyrias. New pre-clinical research findings,
    presented at the 9^th Annual Meeting of the Oligonucleotide Therapeutics
    Society (OTS) held in October 2013, showed that subcutaneous
    administration of a GalNAc-siRNA targeting ALAS-1 led to rapid,
    dose-dependent, and long-lasting knockdown of the ALAS-1 mRNA and complete
    inhibition of the toxic intermediates that mediate the symptoms and
    pathology of acute intermittent porphyria (AIP). Based on these findings,
    including results in non-human primate studies, the company has selected
    its ALN-AS1 Development Candidate and expects to file an IND or IND
    equivalent application for this RNAi therapeutic in late 2014 or early
    2015.
  *The Medicines Company and Alnylam Selected a Development Candidate for
    ALN-PCSsc, a Subcutaneously Administered RNAi Therapeutic Targeting PCSK9
    for the Treatment of Hypercholesterolemia. New data from non-human primate
    studies, presented at the American Heart Association (AHA) Scientific
    Sessions held in November 2013, showed that ALN-PCSsc administration
    results in up to 95% knockdown of plasma PCSK9 and up to 67% lowering of
    LDL cholesterol (LDL-C) in the absence of statins. Pre-clinical durability
    data support the potential for every-two-week dosing and possibly
    every-four-week dosing. Alnylam anticipates submitting an IND or IND
    equivalent application for ALN-PCSsc in late 2014 or early 2015. In
    addition, Alnylam and collaborators published complete study results from
    a Phase 1 trial with ALN-PCS02, an intravenously administered RNAi
    therapeutic targeting PCSK9, in The Lancet. The paper (Fitzgerald, et al.,
    The Lancet, doi:10.1016/S0140-6736(13)61914-5) reports the results of a
    study evaluating single intravenous dose administration of ALN-PCS02, in
    the absence of concomitant lipid-lowering agents such as statins.
    Specifically, ALN-PCS02 administration resulted in rapid, dose-dependent,
    and durable knockdown of plasma PCSK9 of up to 84% relative to baseline
    and placebo, with a corresponding reduction in serum levels of LDL-C – a
    clinically validated endpoint – of up to 57% relative to baseline and
    placebo. In addition, ALN-PCS02 was found to be generally well tolerated
    in this study.
  *Advanced Additional “Alnylam 5x15” Programs. Alnylam continued to advance
    additional programs as part of its “Alnylam 5x15” and genetic medicine
    product strategy, including ALN-AAT, an RNAi therapeutic targeting alpha-1
    antitrypsin (AAT) for the treatment of liver disease associated with AAT
    deficiency; ALN-TMP, an RNAi therapeutic targeting TMPRSS6 for the
    treatment of beta-thalassemia and iron overload disorders; and ALN-ANG, an
    RNAi therapeutic targeting angiopoietin-like 3 (ANGPTL3) for the treatment
    of genetic forms of mixed hyperlipidemia and severe hypertriglyceridemia.
    New data were presented for: ALN-AAT at the 64^th Annual Meeting of the
    American Association for the Study of Liver Diseases (AASLD, “The Liver
    Meeting”) held in November 2013; ALN-ANG at the AHA Scientific Sessions
    held in November 2013; and ALN-TMP at the ASH Meeting held in December
    2013.

Business and Organizational Highlights

  *Formed Transformational Alliance with Genzyme for RNAi Therapeutics as
    Genetic Medicines. Genzyme and Alnylam have formed an alliance to
    accelerate and expand the development and commercialization of RNAi
    therapeutics across the world. The alliance is structured as a
    multi-product geographic alliance in the field of rare diseases. Alnylam
    retains product rights in North America and Western Europe, while Genzyme
    obtains the right to access Alnylam’s current “5x15” and future genetic
    medicines pipeline in the rest of the world (ROW), including
    co-development/co-commercialization and/or global product rights for
    certain programs. In addition, Genzyme becomes a major Alnylam shareholder
    through an upfront purchase of $700 million of newly issued stock at
    approximately $80/share, representing an approximately 12% ownership
    position. Upon closing, this alliance significantly bolsters Alnylam’s
    balance sheet to over $1 billion in cash, enabling an increased investment
    in the company’s RNAi therapeutics pipeline and is expected to secure
    Alnylam’s financial independence through to multiple product launches.
    This transaction has been approved by the boards of both companies, and is
    subject to customary closing conditions and clearances under the
    Hart-Scott Rodino Antitrust Improvements Act.
  *Acquired Investigational RNAi Therapeutic Assets from Merck, Including
    Sirna Therapeutics. The acquisition, which includes Merck’s wholly owned
    subsidiary Sirna Therapeutics, Inc., provides Alnylam with intellectual
    property and RNAi assets including pre-clinical therapeutic candidates,
    chemistry, siRNA-conjugate and other delivery technologies. Under the
    terms of the agreement, in exchange for acquiring the stock of Sirna
    Therapeutics, Alnylam will pay Merck an upfront payment of $175 million in
    cash and equity ($25 million cash/$150 million in Alnylam common stock).
    In addition, Merck is eligible to receive milestones and royalties based
    on advancement of certain pre-clinical candidates discovered by Merck and
    on Alnylam products covered by the Sirna Therapeutics patent estate. This
    transaction is subject to customary closing conditions, including the
    requirements under the Hart-Scott Rodino Antitrust Improvements Act.
  *Earned Additional Milestone Payments from Genzyme for Advancement of
    Patisiran. Per the terms of the original agreement entered into in October
    2012 between Alnylam and Genzyme, Alnylam earned a $7 million milestone
    from Genzyme for achieving Phase 2 success with patisiran. In addition,
    Alnylam announced today that it has received an additional $4 million
    milestone from Genzyme associated with the initiation of dosing in the
    APOLLO Phase 3 trial with patisiran.
  *Expanded Management Team. Alnylam announced today that Jeffrey Cehelsky
    has been promoted to Vice President, Clinical Operations, from Senior
    Director, Clinical Operations, a position he held since shortly after
    joining the company in 2005.

Conference Call Information

Management will provide an update on the company, discuss fourth quarter and
2013 results, and discuss expectations for the future via conference call on
Thursday, February 13, 2014 at 4:30 p.m. ET. A corporate slide presentation
will also be available on the Investors page of the company’s website,
www.alnylam.com, to accompany the conference call. To access the call, please
dial 877-312-7507(domestic) or 631-813-4828 (international) five minutes
prior to the start time and refer to conference ID 46682151. A replay of the
call will be available beginning at 7:30 p.m. ET on Thursday, February 13,
2014. To access the replay, please dial 855-859-2056 (domestic) or
404-537-3406 (international), and refer to conference ID 46682151.

About RNA Interference (RNAi)

RNAi (RNA interference) is a revolution in biology, representing a
breakthrough in understanding how genes are turned on and off in cells, and a
completely new approach to drug discovery and development. Its discovery has
been heralded as “a major scientific breakthrough that happens once every
decade or so,” and represents one of the most promising and rapidly advancing
frontiers in biology and drug discovery today which was awarded the 2006 Nobel
Prize for Physiology or Medicine. RNAi is a natural process of gene silencing
that occurs in organisms ranging from plants to mammals. By harnessing the
natural biological process of RNAi occurring in our cells, the creation of a
major new class of medicines, known as RNAi therapeutics, is on the horizon.
Small interfering RNA (siRNA), the molecules that mediate RNAi and comprise
Alnylam’s RNAi therapeutic platform, target the cause of diseases by potently
silencing specific mRNAs, thereby preventing disease-causing proteins from
being made. RNAi therapeutics have the potential to treat disease and help
patients in a fundamentally new way.

About Alnylam Pharmaceuticals

Alnylam is a biopharmaceutical company developing novel therapeutics based on
RNA interference, or RNAi. The company is leading the translation of RNAi as a
new class of innovative medicines with a core focus on RNAi therapeutics as
genetic medicines, including programs as part of the company’s “Alnylam
5x15^TM” product strategy. Alnylam’s genetic medicine programs are RNAi
therapeutics directed toward genetically defined targets for the treatment of
serious, life-threatening diseases with limited treatment options for patients
and their caregivers. These include: patisiran (ALN-TTR02), an intravenously
delivered RNAi therapeutic targeting transthyretin (TTR) for the treatment of
TTR-mediated amyloidosis (ATTR) in patients with familial amyloidotic
polyneuropathy (FAP); ALN-TTRsc, a subcutaneously delivered RNAi therapeutic
targeting TTR for the treatment of ATTR in patients with TTR cardiac
amyloidosis, including familial amyloidotic cardiomyopathy (FAC) and senile
systemic amyloidosis (SSA); ALN-AT3, an RNAi therapeutic targeting
antithrombin (AT) for the treatment of hemophilia and rare bleeding disorders
(RBD); ALN-CC5, an RNAi therapeutic targeting complement component C5 for the
treatment of complement-mediated diseases; ALN-AS1, an RNAi therapeutic
targeting aminolevulinate synthase-1 (ALAS-1) for the treatment of hepatic
porphyrias including acute intermittent porphyria (AIP); ALN-PCS, an RNAi
therapeutic targeting PCSK9 for the treatment of hypercholesterolemia;
ALN-AAT, an RNAi therapeutic targeting alpha-1-antitrypsin (AAT) for the
treatment of AAT deficiency liver disease; ALN-TMP, an RNAi therapeutic
targeting TMPRSS6 for the treatment of beta-thalassemia and iron-overload
disorders; ALN-ANG, an RNAi therapeutic targeting angiopoietin-like 3
(ANGPTL3) for the treatment of genetic forms of mixed hyperlipidemia and
severe hypertriglyceridemia; and other programs yet to be disclosed. As part
of its “Alnylam 5x15” strategy, as updated in early 2014, the company expects
to have six to seven genetic medicine product candidates in clinical
development - including at least two programs in Phase 3 and five to six
programs with human proof of concept - by the end of 2015. The company’s
demonstrated commitment to RNAi therapeutics has enabled it to form major
alliances with leading companies including Merck, Medtronic, Novartis, Biogen
Idec, Roche, Takeda, Kyowa Hakko Kirin, Cubist, GlaxoSmithKline, Ascletis,
Monsanto, The Medicines Company, and Genzyme, a Sanofi company. In January
2014, Alnylam agreed to acquire Sirna Therapeutics, a wholly owned subsidiary
of Merck. In addition, Alnylam holds an equity position in Regulus
Therapeutics Inc., a company focused on discovery, development, and
commercialization of microRNA therapeutics. Alnylam scientists and
collaborators have published their research on RNAi therapeutics in over 200
peer-reviewed papers, including many in the world’s top scientific journals
such as Nature, Nature Medicine, Nature Biotechnology, Cell, the New England
Journal of Medicine, and The Lancet. Founded in 2002, Alnylam maintains
headquarters in Cambridge, Massachusetts. For more information, please visit
www.alnylam.com.

About “Alnylam 5x15™” and Genetic Medicines

The “Alnylam 5x15” strategy, launched in January 2011, establishes a path for
development and commercialization of novel RNAi therapeutics as genetic
medicines. Alnylam’s genetic medicine programs are RNAi therapeutics directed
toward genetically defined targets for the treatment of diseases with high
unmet medical need. These programs share several key characteristics
including: a genetically defined target and disease expressed in the liver;
the potential to have a major impact in a high unmet need population; the
ability to leverage the existing Alnylam RNAi platform with clinically proven
delivery to the liver; the opportunity to monitor an early biomarker in Phase
1 clinical trials for human proof of concept; and the existence of clinically
relevant endpoints for the filing of a new drug application (NDA) with a
focused patient database and possible accelerated paths for commercialization.
As updated in early 2014, the company expects to have six to seven genetic
medicine product candidates in clinical development - including at least two
programs in Phase 3 and five to six programs with human proof of concept - by
the end of 2015. The “Alnylam 5x15” programs include: patisiran (ALN-TTR02),
an intravenously delivered RNAi therapeutic targeting transthyretin (TTR) in
development for the treatment of TTR-mediated amyloidosis (ATTR) in patients
with familial amyloidotic polyneuropathy (FAP); ALN-TTRsc, a subcutaneously
delivered RNAi therapeutic targeting TTR in development for the treatment of
ATTR in patients with TTR cardiac amyloidosis, including familial amyloidotic
cardiomyopathy (FAC) and senile systemic amyloidosis (SSA); ALN-AT3, an RNAi
therapeutic targeting antithrombin (AT) in development for the treatment of
hemophilia and rare bleeding disorders (RBD); ALN-CC5, an RNAi therapeutic
targeting complement component C5 in development for the treatment of
complement-mediated diseases; ALN-AS1, an RNAi therapeutic targeting
aminolevulinate synthase-1 (ALAS-1) in development for the treatment of
hepatic porphyrias including acute intermittent porphyria (AIP); ALN-PCS, an
RNAi therapeutic targeting PCSK9 in development for the treatment of
hypercholesterolemia; ALN-AAT, an RNAi therapeutic targeting
alpha-1-antitrypsin (AAT) for the treatment of AAT deficiency liver disease;
ALN-TMP, an RNAi therapeutic targeting TMPRSS6 in development for the
treatment of beta-thalassemia and iron-overload disorders; ALN-ANG, an RNAi
therapeutic targeting angiopoietin-like 3 (ANGPTL3) for the treatment of
genetic forms of mixed hyperlipidemia and severe hypertriglyceridemia; and
other programs yet to be disclosed. In 2014, Alnylam and Genzyme, a Sanofi
company, formed a multi-product geographic alliance on Alnylam’s genetic
medicine programs. Specifically, Alnylam will lead development and
commercialization of programs in North America and Europe, while Genzyme will
develop and commercialize products in the rest of world. In addition, Alnylam
and Genzyme will co-develop and co-commercialize ALN-TTRsc in North America
and Europe.

Alnylam Forward-Looking Statements

Various statements in this release concerning Alnylam’s future expectations,
plans and prospects, including without limitation, Alnylam’s expectations
regarding its “Alnylam 5x15” product strategy, Alnylam’s views with respect to
the potential for RNAi therapeutics, including patisiran (ALN-TTR02) and
ALN-TTRsc, ALN-AT3, ALN-CC5, ALN-AS1, ALN-PCSsc, ALN-AAT, ALN-TMP, and
ALN-ANG, its expectations with respect to the timing, execution, and success
of its clinical and pre-clinical trials, the expected timing of regulatory
filings, including its plan to file IND or IND equivalent applications and
initiate clinical trials for ALN-TTRsc, ALN-CC5, ALN-AS1, and ALN-PCSsc, its
expectations regarding reporting of data from its clinical studies, including
its studies for patisiran, ALN-TTRsc, and ALN-AT3, as well as other research
programs and technologies, its plans regarding commercialization of RNAi
therapeutics, Genzyme’s participation in the development and commercialization
of RNAi therapeutics, Alnylam’s views with respect to the potential value of
the assets being acquired from Merck and its ability to further its efforts to
build a new class of medicines, the potential timing of the closing of the
Genzyme and Merck transactions, its expected cash position on a pro forma
basis following the closing of the Genzyme transaction and as of December 31,
2014, and its expectations regarding available cash for its operations through
multiple product launches, constitute forward-looking statements for the
purposes of the safe harbor provisions under The Private Securities Litigation
Reform Act of 1995. Actual results may differ materially from those indicated
by these forward-looking statements as a result of various important factors,
including, without limitation, Alnylam’s ability to manage operating expenses,
Alnylam’s ability to discover and develop novel drug candidates and delivery
approaches, successfully demonstrate the efficacy and safety of its drug
candidates, the pre-clinical and clinical results for its product candidates,
which may not support further development of product candidates, actions of
regulatory agencies, which may affect the initiation, timing and progress of
clinical trials, obtaining, maintaining and protecting intellectual property,
Alnylam’s ability to enforce its patents against infringers and defend its
patent portfolio against challenges from third parties, obtaining regulatory
approval for products, competition from others using technology similar to
Alnylam’s and others developing products for similar uses, Alnylam’s ability
to obtain additional funding to support its business activities and establish
and maintain strategic business alliances and new business initiatives,
Alnylam’s dependence on third parties for development, manufacture, marketing,
sales and distribution of products, the outcome of litigation, and unexpected
expenditures, as well as those risks more fully discussed in the “Risk
Factors” filed with Alnylam’s most recent Quarterly Report on Form 10-Q filed
with the Securities and Exchange Commission (SEC) and in other filings that
Alnylam makes with the SEC. In addition, any forward-looking statements
represent Alnylam’s views only as of today and should not be relied upon as
representing its views as of any subsequent date. Alnylam explicitly disclaims
any obligation to update any forward-looking statements.


Alnylam Pharmaceuticals, Inc.
Unaudited Condensed Consolidated Statements of Comprehensive Loss
(In thousands, except per share amounts)
                                                             
                        Three Months Ended          Year Ended
                        December 31,                December 31,
                         2013        2012        2013        2012     
                                                                  
Net revenues from       $ 10,847     $ 8,495      $ 47,167     $ 66,725   
collaborators
                                                                  
Operating expenses:
Research and              32,106        21,678        112,957       86,569
development ^(1)
General and               8,333         10,166        27,152        44,612
administrative ^(1)
Restructuring of
Tekmira license          -           65,000      -           65,000   
agreement
Total operating          40,439      96,844      140,109     196,181  
expenses
Loss from operations     (29,592 )    (88,349 )    (92,942 )    (129,456 )
Other income
(expense):
Equity in loss of
joint venture             -             (881    )     -             (4,522   )
(Regulus Therapeutics
Inc.)
Gain on issuance of
stock by Regulus          -             16,084        -             16,084
Therapeutics Inc.
Interest income           285           222           1,069         977
Other (expense)          (29     )    164         (47     )    331      
income
Total other income       256         15,589      1,022       12,870   
(expense)
Loss before income        (29,336 )     (72,760 )     (91,920 )     (116,586 )
taxes
(Provision for)
benefit from income      (3,021  )    10,572      2,695       10,572   
taxes
Net loss                $ (32,357 )   $ (62,188 )   $ (89,225 )   $ (106,014 )
                                                                  
Net loss per common
share - basic and       $ (0.51   )   $ (1.20   )   $ (1.45   )   $ (2.11    )
diluted
                                                                  
Weighted average
common shares used to
compute basic and         62,909        51,821        61,551        50,286
diluted net loss per
common share
                                                                  
Comprehensive loss
Net loss                $ (32,357 )   $ (62,188 )   $ (89,225 )   $ (106,014 )
Unrealized (loss)
gain on marketable       (7,451  )    15,554      4,055       15,827   
securities, net of
tax
Comprehensive loss      $ (39,808 )   $ (46,634 )   $ (85,170 )   $ (90,187  )
                                                                  
(1) Non-cash
stock-based
compensation expenses
included in operating
expenses are as
follows:
Research and            $ 3,277       $ 1,684       $ 14,369      $ 8,041
development
General and               2,129         1,038         6,334         4,319
administrative
                                                                             


Alnylam Pharmaceuticals, Inc.
Unaudited Condensed Consolidated Balance Sheets
(In thousands, except share amounts)
                                                              
                                                  December 31,  December 31,
                                                 2013          2012
Cash, cash equivalents and total marketable        $350,472       $226,228
securities
Billed and unbilled collaboration receivables      4,248          104
Prepaid expenses and other current assets          3,910          2,641
Property and equipment, net                        16,448         19,799
Investment in equity securities of Regulus        45,452        38,748
Therapeutics Inc.
Total assets                                      $420,530      $287,520
Accounts payable and accrued expenses              $20,056        $15,978
Total deferred revenue                             126,090        132,291
Total deferred rent                                4,037          5,198
Total stockholders’ equity (63.7 million and
52.5 million common shares issued and             270,347       134,053
outstanding and at December 31, 2013 and
December 31, 2012, respectively)
Total liabilities and stockholders' equity        $420,530      $287,520
                                                                  

This selected financial information should be read in conjunction with the
consolidated financial statements and notes thereto included in Alnylam’s
Annual Report on Form 10-K which includes the audited financial statements for
the year ended December 31, 2012.

Contact:

Alnylam Pharmaceuticals, Inc.
Cynthia Clayton, 617-551-8207
Vice President, Investor Relations and
Corporate Communications
or
Michael Mason, 617-551-8327
Vice President, Finance and Treasurer
 
Press spacebar to pause and continue. Press esc to stop.