Alnylam Pharmaceuticals Reports Second Quarter 2014 Financial Results and Highlights Recent Period Activities

  Alnylam Pharmaceuticals Reports Second Quarter 2014 Financial Results and
  Highlights Recent Period Activities

 – Achieved Positive Initial Results in Ongoing Phase 2 Open-Label Extension
     (OLE) Study with Patisiran, Showing Sustained Clinical Activity with
  Transthyretin (TTR) Knockdown at an 80% Target Level and Tolerability with
                              Extended Dosing –

  – Reported Initial Positive Top-Line Data from Phase 1 Clinical Trial with
  ALN-AT3, Demonstrating Statistically Significant Knockdown of Antithrombin
                  (AT) and Increase in Thrombin Generation –

– Broadened Pre-Clinical Pipeline with Development Candidates for ALN-CC5 for
the Treatment of Complement-Mediated Diseases and ALN-AAT for the Treatment of
Alpha-1 Antitrypsin-Associated Liver Disease; Added ALN-HBV for the Treatment
            of Hepatitis B Virus (HBV) Infection as New Program –

   – Presented Pre-clinical Data with ALN-PCSsc Supporting Once-Monthly and
 Possibly Once-Quarterly Subcutaneous Dosing Regimen with an RNAi Therapeutic
         Targeting PCSK9 for the Treatment of Hypercholesterolemia –

 – Maintained Strong Balance Sheet with $956 Million in Cash and Continues to
         Expect to End 2014 with Greater than $825 Million in Cash –

Business Wire

CAMBRIDGE, Mass. -- August 7, 2014

Alnylam Pharmaceuticals, Inc. (Nasdaq: ALNY), a leading RNAi therapeutics
company, today reported its consolidated financial results for the second
quarter 2014, and company highlights.

“During the second quarter and recent period, we continued to execute on our
expanded ‘Alnylam 5x15’ product development strategy and reported on multiple
significant clinical and pre-clinical data sets. As we continue enrolling
patients in our APOLLO Phase 3 trial with patisiran, we were pleased to report
positive initial data from our ongoing Phase 2 open-label extension (OLE)
study, showing sustained knockdown of serum TTR protein levels in addition to
a favorable tolerability profile. Patients in the OLE study have been treated
for up to nine months, and there have been no discontinuations. Enrollment
also continues in our ALN-TTRsc Phase 2 study in TTR cardiomyopathy and we
remain on track to initiate our Phase 3 trial later this year,” said John
Maraganore, Ph.D., Chief Executive Officer of Alnylam. “Beyond our efforts in
TTR amyloidosis, we were pleased to report positive top-line data with
ALN-AT3, an RNAi therapeutic targeting antithrombin (AT) in development for
the treatment of hemophilia and rare bleeding disorders, showing that a
single, low subcutaneous dose resulted in statistically significant knockdown
of AT, with a corresponding increase in peak thrombin generation that was
temporally associated and consistent with the degree of target protein
knockdown. In aggregate, these latest results from our clinical pipeline
highlight what we believe to be the significant potential for RNAi
therapeutics as a new class of genetic medicines. We very much look forward to
sharing additional updates from our pipeline in the coming weeks and months,
as we enter a data-rich back half of the year.”

“In addition to advancements in our clinical pipeline, we also made strong
progress with our pre-clinical programs. First, we were pleased to select our
Development Candidate for ALN-CC5 – an RNAi therapeutic targeting complement
C5 for the treatment of complement-mediated diseases – and we remain on track
to file our IND for this program in late 2014. Our new pre-clinical results
with ALN-PCSsc – an RNAi therapeutic targeting PCSK9 for the treatment of
hypercholesterolemia – highlight the potential for once-monthly or possibly
once-quarterly subcutaneous dosing which we believe has the potential to be
disruptive in a significant emerging market; we expect to file a clinical
trial application (CTA) for ALN-PCSsc later this year. In addition, we
selected a Development Candidate for our ALN-AAT program – an RNAi therapeutic
targeting alpha-1 antitrypsin (AAT) for the treatment of AAT deficiency
associated liver disease – with the goal of filing an IND for this program in
mid-2015, and we added ALN-HBV – an RNAi therapeutic targeting the hepatitis B
viral (HBV) genome for the treatment HBV infection – as a new program with the
goal of filing an IND around year-end 2015. All of these programs employ our
Enhanced Stabilization Chemistry (ESC) GalNAc-conjugate technology, that
enables subcutaneous dosing with increased potency, durability, and a wide
therapeutic index, and we are very encouraged by the potent knockdown and
durability results emerging from our programs utilizing this improved
technology,” said Barry Greene, President and Chief Operating Officer of
Alnylam. “In addition to these pipeline advancements, we’ve had a very
productive quarter with regard to our intellectual property estate,
specifically with our McSwiggen and Manoharan patent families. These and other
Alnylam-held patents are critical elements of our strategy to bring important
medicines to patients and build value for our shareholders.”

Cash, Cash Equivalents and Total Marketable Securities
At June 30, 2014, Alnylam had cash, cash equivalents and total marketable
securities of $955.9 million, as compared to $350.5 million at December 31,
2013. In February 2014, the company sold to Genzyme 8,766,338 shares of its
common stock and received a cash payment of $700.0 million.

Non-GAAP Net Loss
The non-GAAP net loss for the second quarter of 2014 was $48.0 million, or
$0.63 per share on both a basic and diluted basis as compared to a non-GAAP
net loss of $18.2 million, or $0.29 per share on both a basic and diluted
basis for the same period in the previous year. The non-GAAP net loss for the
second quarter of 2014 excludes the $3.9 million reduction to in-process
research and development expense related to the purchase of the Sirna RNAi
assets from Merck, described below.

GAAP Net Loss
The net loss according to accounting principles generally accepted in the U.S.
(GAAP) for the second quarter of 2014 was $44.1 million, or $0.58 per share on
both a basic and diluted basis (including $7.7 million, or $0.10 per share of
non-cash stock-based compensation expense), as compared to a net loss of $18.2
million, or $0.29 per share on both a basic and diluted basis (including $3.4
million, or $0.05 per share of non-cash stock-based compensation expense), for
the same period in the previous year.

Revenues
Revenues were $7.3 million for the second quarter of 2014, as compared to $8.7
million for the same period in the previous year. Revenues for the second
quarter of 2014 included $5.5 million of revenues from the company’s alliance
with Takeda Pharmaceuticals Company Limited, $1.4 million of revenues related
to the company’s collaboration with Monsanto, and $0.4 million for the
company’s alliance with The Medicines Company, research reagent licenses, and
other sources.

Research and Development Expenses
Research and development (R&D) expenses were $44.7 million in the second
quarter of 2014, which included $2.6 million of non-cash stock-based
compensation, as compared to $24.2 million in the second quarter of 2013,
which included $2.2 million of non-cash stock-based compensation. The increase
in R&D expenses in the second quarter of 2014 as compared to the second
quarter of 2013 was due primarily to additional expenses related to the
significant advancement of certain of the company’s clinical and pre-clinical
programs. The company expects that R&D expenses will increase slightly for the
second half of 2014 as certain of our programs move into late clinical stages.

In-Process Research and Development Expense
In the second quarter of 2014, the company recorded a reduction of $3.9
million to in-process research and development expense in connection with the
purchase of the Sirna RNAi assets from Merck. Upon the completion of certain
technology transfer activities in the second quarter of 2014, the company
issued 378,007 shares of common stock to Merck. In the second quarter of 2014,
the company re-measured the expense recorded in the first quarter of 2014 in
connection with these shares using the price of the company’s common stock on
the issuance date. In future periods, there will be no additional charges
recorded to in-process research and development related to the purchase of the
Sirna RNAi assets from Merck.

General and Administrative Expenses
General and administrative (G&A) expenses were $11.5 million in the second
quarter of 2014, which included $5.1 million of non-cash stock-based
compensation, as compared to $5.8 million in the second quarter of 2013, which
included $1.2 million of non-cash stock-based compensation. The increase in
G&A expenses in the second quarter of 2014 as compared to the second quarter
of 2013 was due primarily to higher non-cash stock-based compensation expense.
Excluding non-cash stock-based compensation expense, the company expects that
G&A expenses will remain consistent for the second half of 2014.

“Alnylam continues to maintain a very strong balance sheet, ending the second
quarter with $956 million in cash,” said Michael Mason, Vice President,
Finance and Treasurer of Alnylam. “As previously guided, we remain on track to
end 2014 with greater than $825 million in cash. We believe that this balance
sheet allows us to invest in a broad pipeline of RNAi therapeutics and to
maintain financial independence through to multiple product launches.”

Second Quarter 2014 and Recent Significant Corporate Highlights

Key “Alnylam 5x15” and Genetic Medicine Pipeline Highlights

  *Continued to Advance Patisiran (ALN-TTR02) in Development for the
    Treatment of Transthyretin (TTR)-Mediated Amyloidosis (ATTR) in Patients
    with Familial Amyloidotic Polyneuropathy (FAP).

       *Alnylam continues to enroll patients in its APOLLO Phase 3 trial,
         with over 20 sites in 9 countries now open and active. The Phase 3
         trial is intended to demonstrate the efficacy and safety of patisiran
         in support of marketing authorization in countries around the world.
       *At the International Symposium on Amyloidosis (ISA) held April 27 -
         May 1, 2014 the company presented multiple updates from its patisiran
         program. Amongst other data, the company presented initial positive
         results from its ongoing Phase 2 open-label extension (OLE) study.
         The OLE study is enrolling patients that were treated in the Phase 2
         study and is designed to evaluate the long-term safety and
         tolerability of patisiran administration. The company has now
         completed enrollment in the study with 27 patients. After up to nine
         months of therapy, there have been no study drug discontinuations.
         The OLE study is measuring a number of clinical endpoints every six
         months, including the modified composite Neuropathy Impairment Score,
         termed "mNIS+7;" this score is also the primary endpoint of the Phase
         3 APOLLO trial of patisiran in FAP. Preliminary results from 23
         patients showed that the TTR knockdown observed following the first
         dose in the OLE study closely matched TTR knockdown shown in the
         Phase 2 study, with essentially superimposable pharmacodynamic
         effects. Further, repeat dosing of patisiran led to a sustained TTR
         knockdown of approximately 80% through up to day 168, equivalent to
         up to eight doses of drug, as measured in pre-dose blood samples.
         These data provide the first clinical evidence of sustained,
         RNAi-mediated TTR knockdown in FAP patients beyond two doses of
         patisiran. Repeat dosing of patisiran was found to be well tolerated,
         with minimal adverse events. In addition, the use of a proprietary
         micro-dosing infusion regimen was found to significantly reduce the
         incidence of infusion-related reactions. Alnylam plans on reporting
         initial clinical endpoint data from the OLE study at the 2014
         American Neurological Association Annual Meeting, being held October
         12 – 14, 2014 in Baltimore, where the initial dataset is expected to
         include 6 month mNIS+7 results from approximately 20 patients.
       *In addition, Alnylam and collaborators presented results of a natural
         history, cross-sectional analysis study of 283 FAP patients. These
         findings showed rapid progression of the neuropathy impairment score
         and correlation with disease severity, providing support for
         Alnylam's Phase 3 APOLLO trial design.
       *Finally, the company presented a pre-clinical update with its ATTR
         program. Alnylam scientists presented data confirming that the degree
         of TTR knockdown in a mouse disease model was highly correlated with
         regression of TTR tissue deposits. Further, comparative studies were
         performed with the TTR stabilizer tafamidis and a TTR-specific
         antisense oligonucleotide (ASO). In these pre-clinical studies, RNAi
         therapeutics targeting TTR were shown to have superior profiles.
       *Alnylam also completed enrollment of 12 healthy volunteers of
         Japanese descent in a Phase 1 study with patisiran. This study is
         intended to support the expansion of the APOLLO trial to include
         sites in Japan.

  *Continued Advancement of ALN-TTRsc, a Subcutaneously Administered RNAi
    Therapeutic Targeting TTR in Development for the Treatment of ATTR
    Patients with Cardiac Amyloidosis. The company continued enrollment in its
    pilot Phase 2 study of ALN-TTRsc. This Phase 2 trial is aimed at
    evaluating the tolerability and preliminary clinical activity of ALN-TTRsc
    in 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. Based on encouraging enrollment to date, the
    protocol for this study was amended to enroll up to 25 FAC or SSA
    patients; the previous enrollment target had been 15. Pending abstract
    acceptance, the company expects to present data from the Phase 2 trial at
    the American Heart Association Scientific Sessions 2014, being held
    November 15 – 19, 2014 in Chicago. 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 on track 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. In addition, the protocol
    for the company’s Phase 1 trial with ALN-TTRsc was amended to enroll up to
    76 normal human volunteers; previous target enrollment had been 40
    subjects and results from that study were presented at the Heart Failure
    Society of America 17th Annual Scientific Meeting in September 2013. The
    increase in target enrollment was performed to determine a fixed (i.e.,
    non-weight-adjusted) dose regimen in support of the planned Phase 3 trial.
    Finally, ALN-TTRsc received a positive opinion for Orphan Drug Designation
    in Europe.
  *Reported Initial Positive Top-Line Data from Phase 1 Clinical Trial with
    ALN-AT3, an RNAi Therapeutic Targeting Antithrombin (AT) in Development
    for the Treatment of Hemophilia and Rare Bleeding Disorders (RBD). Results
    were presented at the World Federation of Hemophilia (WFH) 2014 World
    Congress, held May 11 – 15, 2014 in Melbourne, Australia. In Part A of the
    Phase 1 study, human volunteer subjects received a single subcutaneous
    dose of ALN-AT3 and, per protocol, the maximum allowable level of AT
    knockdown was set at 40%. Initial results from the sole dose cohort
    enrolled (n=4, 3:1, drug:placebo) showed that a single, low subcutaneous
    ALN-AT3 dose at 0.03 mg/kg resulted in an up to 28-32% knockdown of AT at
    nadir that was statistically significant relative to placebo (p < 0.01 by
    ANOVA). This resulted in a statistically significant (p < 0.01) increase
    in peak thrombin generation, that was temporally associated and consistent
    with the degree of AT knockdown. ALN-AT3 was found to be well tolerated
    with no significant adverse events reported. ALN-AT3 is the company’s
    first program to enter clinical development using Alnylam’s Enhanced
    Stabilization Chemistry (ESC)-GalNAc-conjugate technology, which enables
    subcutaneous dosing with increased potency, durability, and a wide
    therapeutic index. The company has now transitioned to the Multiple
    Ascending Dose (MAD) Part B of the study, which is designed as 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, specifically three 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. Assuming
    abstract acceptance, Alnylam intends to present initial clinical results
    from the Phase 1 study, including all available results in hemophilia
    subjects, at the 56^th American Society of Hematology (ASH) Annual Meeting
    being held December 6 – 9, 2014 in San Francisco. Finally, Alnylam
    announced earlier today that ALN-AT3 has received Orphan Drug Designation
    in the European Union.
  *Advanced Development Candidate for ALN-CC5, a Subcutaneously Administered
    RNAi Therapeutic Targeting Complement Component C5 in Development for the
    Treatment of Complement-Mediated Diseases. New results were presented at
    the 7^thInternational Conference on Complement Therapeutics, heldJune
    6- 11, 2014, inOlympia,Greece, demonstrating that ALN-CC5 led to an up
    to 98.7% knockdown of serum C5 and an up to 96.8% inhibition of serum
    complement activity in non-human primates (NHPs) with weekly subcutaneous
    dose administration. ALN-CC5 utilizes Alnylam’s ESC-GalNAc-conjugate
    technology. Assuming abstract acceptance, Alnylam intends to present
    additional pre-clinical results from its ALN-CC5 program at the 56^th
    American Society of Hematology (ASH) Annual Meeting being held December 6
    – 9, 2014 in San Francisco. The company is on track to file its ALN-CC5
    IND or IND equivalent in late 2014, and expects to present initial
    clinical results in mid-2015.
  *Presented New Pre-clinical Data on Subcutaneously Delivered RNAi
    Therapeutics for Cardio-Metabolic Diseases, including ALN-PCSsc – an RNAi
    Therapeutic Targeting PCSK9 in Development for the Treatment of
    Hypercholesterolemia – and Added New Program.

       *At the Arteriosclerosis, Thrombosis and Vascular Biology (ATVB) 2014
         Scientific Sessions, the company presented an update on its
         cardio-metabolic disease programs. First, Alnylam presented new
         single-dose data for ALN-PCSsc showing robust knockdown of PCSK9 of
         up to 96% and reduction in LDL-C of up to 77%, in the absence of
         statin co-administration. A single dose of ALN-PCSsc maintained
         greater than 50% reduction in LDL-C for over three months, a level of
         durability that the company believes supports a once-monthly and
         possibly once-quarterly subcutaneous dosing regimen. ALN-PCSsc
         employs the company’s ESC-GalNAc-conjugate technology. The company
         had previously guided that it plans to file an IND or IND equivalent,
         for ALN-PCSsc by late 2014 or early 2015; Alnylam is announcing today
         that it plans to file a Clinical Trial Application (CTA) for
         ALN-PCSsc in late 2014 and expects to present initial clinical
         results in mid-2015. The ALN-PCS program is partnered with The
         Medicines Company, where, under the terms of the agreement, Alnylam
         will complete certain pre-clinical studies and a Phase 1 clinical
         study of ALN-PCSsc and The Medicines Company is responsible for
         leading and funding development from Phase 2 forward and
         commercializing the ALN-PCS program, if successful.
       *In addition, the company presented pre-clinical data from a new
         program: ALN-AC3, an RNAi therapeutic targeting apolipoprotein C-III
         (apoCIII) for the treatment of hypertriglyceridemia. Alnylam plans to
         conduct pre-clinical work in this program to finalize its Development
         Candidate.

  *Announced Development Candidate for ALN-AAT, an RNAi Therapeutic Targeting
    Alpha-1-Antitrypsin (AAT) in Development for the Treatment of AAT
    Deficiency-Associated Liver Disease. New pre-clinical data were presented
    in a Late-Breaking Abstract Session at Digestive Disease Week (DDW), held
    May 3 – 6, 2014 in Chicago, Illinois. AAT deficiency liver disease is
    caused by accumulation of mutant AAT protein (“Z-allele” or “Z-AAT”) in
    liver tissue with subsequent liver injury, fibrosis, and, in some cases,
    hepatocellular carcinoma. The ALN-AAT Development Candidate employs
    Alnylam’s ESC-GalNAc-conjugate technology. Alnylam plans to initiate
    IND-enabling studies with the goal of filing an IND or IND equivalent for
    ALN-AAT in mid-2015. In addition, Alnylam and The Alpha-1 Project (TAP),
    the venture philanthropy subsidiary of theAlpha-1 Foundation, announced
    that they have entered into a collaboration agreement for the continued
    advancement of ALN-AAT.
  *Published Pre-Clinical Results with ALN-AS1, an RNAi Therapeutic Targeting
    Aminolevulinic Acid Synthase-1 (ALAS-1) for the Treatment of Hepatic
    Porphyrias, in the Proceedings of the National Academy of Sciences. In the
    paper, titled "RNAi-mediated silencing of hepaticAlas1effectively
    prevents and treats the induced acute attacks in acute intermittent
    porphyria mice," Alnylam scientists and collaborators at the Icahn School
    of Medicine atMount SinaiinNew York Citydocumented results from
    pre-clinical models of the human disease showing that RNAi therapeutics
    targeting ALAS-1 can completely block the abnormal production of toxic
    intermediates of the heme biosynthesis pathway that cause the symptoms and
    disease pathology of AIP. Alnylam is currently advancing ALN-AS1, a
    subcutaneously administered RNAi therapeutic targeting ALAS-1 for the
    treatment of hepatic porphyrias, including acute intermittent porphyria
    (AIP). ALN-AS1 utilizes the company's ESC-GalNAc-conjugate technology.
    Alnylam expects to file an IND or IND equivalent for ALN-AS1 in late 2014
    or early 2015.
  *Advanced ALN-HBV for the Treatment of Hepatitis B Virus (HBV) Infection.
    The new ALN-HBV program derives from the company'sJanuary 2014
    acquisition of Merck's RNAi assets, including theirSirna
    Therapeuticssubsidiary. In the most comprehensive pre-clinical study
    results presented to date with an RNAi therapeutic for the treatment of
    HBV, Alnylam reported significant, multi-log reductions in HBV surface
    antigen (HBsAg) and HBV viral titers, and showed evidence for an
    immune-mediated therapeutic effect in chronically infected chimpanzees.
    Specifically, the new data, presented at TIDES 2014, held May 12 – 15 in
    Providence, Rhode Island, demonstrated an up to 2.3 log10 reduction HBsAg.
    Alnylam plans to advance an ESC-GalNAc-siRNA conjugate targeting the HBV
    genome for its ALN-HBV program, which should enable once monthly
    subcutaneous dose administration with potent and durable effects, and a
    wide therapeutic index. The company expects to select a Development
    Candidate in late 2014 and plans to file an IND or IND equivalent around
    year end 2015.
  *Presented Key Scientific Data on Enhanced ESC-GalNAc-siRNA Conjugate
    Technology. Data presented at TIDES 2014 showed that chemical
    modifications of siRNA that enhance in vitro stability result in higher
    liver exposure in vivo and lead to a significantly increased potency and
    durability of effect. As compared with the “standard template chemistry”
    (STC)-GalNAc-conjugate approach used in ALN-TTRsc, ESC-GalNAc-siRNA
    conjugates demonstrated a 10-fold increased potency in NHP studies and,
    based on results with ALN-AT3, an over 50-fold increased potency in
    humans. In addition, ESC-GalNAc-siRNA conjugates demonstrate a durability
    of knockdown effect that supports once-monthly or potentially even less
    frequent subcutaneous dosing regimens. Finally, ESC-GalNAc-conjugates
    demonstrate a wide therapeutic index based on multi-dose toxicology
    studies performed in rodents and NHP. This subcutaneous delivery
    technology is being used in all Alnylam clinical and pre-clinical programs
    with the exception of patisiran and ALN-TTRsc.

Business and Organizational Highlights

  *Strengthened Intellectual Property (IP) Estate.

       *Alnylam announced that the McSwiggen EP 1423406 ('406) patent was
         upheld by the European Patent Office (EPO) in opposition proceedings.
         The McSwiggen patent estate comprises a core component of Alnylam's
         overall IP estate for the advancement of RNAi therapeutics, and was
         recently obtained through the company's acquisition of Sirna
         Therapeutics from Merck. The upheld McSwiggen patent broadly
         describes chemical modifications of RNAi therapeutics needed to
         achieve "drug-like" properties in siRNA, the molecules that mediate
         RNAi.
       *Alnylam announced that the United States Patent and Trademark Office
         (USPTO) issued a patent covering RNAi Therapeutics for the treatment
         of HBV infection. The new patent (U.S. patent no. 8,618,277, or "'277
         patent") is part of the company's McSwiggen patent estate.
         Specifically, the '277 patent includes claims that the company
         believes are critical for the development of RNAi therapeutics for
         the treatment of HBV infection. This patent is held exclusively by
         Alnylam and is not licensed to any third parties.
       *Finally, Alnylam received a Notice of Allowance from the USPTO for a
         new patent broadly covering conjugate-based delivery of RNA
         therapeutics. The Manoharan et al. patent application 13/693,478,
         (the “’478 Application”) includes newly allowed claims directed to
         compositions including those comprising a modified RNA agent linked
         to a biantennary or triantennary ligand. Specifically, the allowed
         application includes claims that broadly cover single-stranded or
         double-stranded, chemically modified RNA therapeutics conjugated with
         an N-acetylgalactosamine (GalNAc) ligand independent of length,
         sequence, or disease target.

  *Alnylam Added to Russell 1000 Index. TheRussell1000 Index measures the
    performance of the large-cap segment of the U.S. equity universe. It is a
    subset of theRussell3000 Indexand includes approximately 1000 of the
    largest securities based on a combination of their market cap and current
    index membership.
  *Expanded Board of Directors. Alnylam appointed Amy W. Schulman to its
    Board of Directors. Ms. Schulman is the former Executive Vice President
    andGeneral Counselof Pfizer Inc., and served as the Business Unit Lead
    for Pfizer'sConsumer Healthcarebusiness. She currently serves on the
    faculty ofHarvard Business Schoolas a Senior Lecturer. In addition, she
    is a Venture Partner at Polaris Partners and the CEO of Arsia
    Therapeutics, one of Polaris’s early stage portfolio companies.

Conference Call Information
Management will provide an update on the company, discuss second quarter 2014
results, and discuss expectations for the future via conference call on
Thursday, August 7, 2014 at 4:30 p.m. ET. 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 83034261. A replay of the call will
be available beginning at 7:30 p.m. ET on August 7, 2014. To access the
replay, please dial 855-859-2056(domestic) or 404-537-3406(international),
and refer to conference ID 83034261.

About 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 GalNAc Conjugates and Enhanced Stabilization Chemistry (ESC) GalNAc
Conjugates
GalNAc-siRNA conjugates are a proprietary Alnylam delivery platform and are
designed to achieve targeted delivery of RNAi therapeutics to hepatocytes
through uptake by the asialoglycoprotein receptor. Alnylam’s Enhanced
Stabilization Chemistry (ESC) GalNAc-conjugate technology enables subcutaneous
dosing with increased potency, durability, and a wide therapeutic index, and
is being employed in several of Alnylam’s genetic medicine programs, including
programs in clinical development.

About LNP Technology
Alnylam has licenses to Tekmira LNP intellectual property for use in RNAi
therapeutic products using LNP technology.

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™”
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 aminolevulinic acid 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-associated 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; ALN-AC3, an RNAi therapeutic
targeting apolipoprotein C-III (apoCIII) for the treatment of
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. Alnylam is also developing ALN-HBV, an
RNAi therapeutic targeting the hepatitis B virus (HBV) genome for the
treatment of HBV infection. 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 March 2014, Alnylam acquired 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
aminolevulinic acid 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-associated 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;
ALN-AC3, a subcutaneously administered RNAi therapeutic targeting
apolipoprotein C-III (apoCIII) for the treatment of 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.

Use of Non-GAAP Financial Measures
Alnylam has presented in this press release certain non-GAAP financial
measures, including non-GAAP net loss and non-GAAP net loss per common share –
basic and diluted. A reconciliation between these non-GAAP financial measures
and the most comparable GAAP financial measures are included in the tables
accompanying this press release.

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, ALN-ANG,
ALN-AC3, and ALN-HBV, 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/or initiate clinical trials for ALN-TTRsc, ALN-CC5,
ALN-PCSsc, ALN-AS1, ALN-AAT, and ALN-HBV, its expectations regarding reporting
of data from its clinical and pre-clinical studies, including its studies for
patisiran, ALN-TTRsc, ALN-AT3, and ALN-CC5, as well as other research programs
and technologies, its plans regarding commercialization of RNAi therapeutics,
Genzyme’s and The Medicines Company’s participation in the development and
commercialization of RNAi therapeutics, Alnylam’s views with respect to the
potential value of the assets acquired from Merck and its ability to further
its efforts to build a new class of medicines, its expected cash position as
of December 31, 2014, and its expectations regarding available cash for its
operations through to 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              Six Months Ended

                     June 30,                        June 30,
                     2014         2013             2014          2013
                                                                     
                                                                     
Net revenues
from                 $ 7,295        $ 8,687          $ 15,570        $ 27,329
collaborators
                                                                     
Operating
expenses:
Research and
development ^          44,672         24,215           88,430          46,394
(1)
In-process
research and           (3,890)        —                220,766         —
development
General and
administrative        11,518        5,784           20,443         12,051
^(1)
Total
operating             52,300        29,999          329,639        58,445
expenses
Loss from             (45,005)      (21,312)        (314,069)      (31,116)
operations
Other income
(expense):
Interest               693            270              1,026           494
income
Other expense         (77)          (11)            (159)          (6)
Total other           616           259             867            488
income
Loss before            (44,389)       (21,053)         (313,202)       (30,628)
income taxes
Benefit from          315           2,884           18,185         3,446
income taxes
Net loss             $ (44,074)     $ (18,169)       $ (295,017)     $ (27,182)
Net loss per
common share -       $ (0.58)       $ (0.29)         $ (4.11)        $ (0.45)
basic and
diluted
Weighted
average common
shares used to
compute basic         75,835        61,661          71,833         60,424
and diluted
net loss per
common share
                                                                     
Comprehensive
loss:
Net loss             $ (44,074)     $ (18,169)       $ (295,017)     $ (27,182)
Unrealized
(loss) gain on
marketable            (3,047)       7,309           2,266          12,468
securities,
net of tax
Comprehensive        $ (47,121)     $ (10,860)       $ (292,751)     $ (14,714)
loss
                                                                     
(1) Non-cash
stock-based
compensation
expenses
included in
operating
expenses are
as follows:
Research and         $ 2,557        $ 2,200          $ 6,238         $ 4,287
development
General and            5,123          1,177            7,033           2,165
administrative
                                                                       
                                                                       

ALNYLAM PHARMACEUTICALS, INC.
UNAUDITED GAAP TO NON-GAAP RECONCILIATION: NET LOSS AND NET LOSS PER SHARE
(In thousands, except per share amounts)
                                             
                    Three Months Ended              Six Months Ended

                    June 30,                        June 30,
                    2014         2013             2014          2013
GAAP net loss       $ (44,074)     $ (18,169)       $ (295,017)     $ (27,182)
Adjustment:
In-process
research and         (3,890)       —               220,766        —
development
Non-GAAP net        $ (47,964)     $ (18,169)       $ (74,251)      $ (27,182)
loss
                                                                    
                                                                    
GAAP net loss
per common          $ (0.58)       $ (0.29)         $ (4.11)        $ (0.45)
share - basic
and diluted
Adjustment
(as detailed         (0.05)        —               3.08           —
above)
Non-GAAP net
loss per
common share        $ (0.63)       $ (0.29)         $ (1.03)        $ (0.45)
- basic and
diluted
                                                                      
                                                                      

Use of Non-GAAP Financial Measures

The company supplements its condensed consolidated financial statements
presented on a GAAP basis by providing additional measures that are considered
“non-GAAP” financial measures under applicable SEC rules. These non-GAAP
financial measures are not prepared in accordance with generally accepted
accounting principles in the United States (GAAP) and should not be viewed in
isolation or as a substitute for GAAP net loss and basic and diluted net loss
per common share.

The company evaluates items on an individual basis, and considers both the
quantitative and qualitative aspects of the item, including (i) its size and
nature, (ii) whether or not it relates to the company’s ongoing business
operations, and (iii) whether or not the company expects it to occur as part
of its normal business on a regular basis. In the second quarter of 2014 and
first half of 2014, the company’s Non-GAAP net loss and Non-GAAP net loss per
common share – basic and diluted financial measures excludes the in-process
research and development reduction to expense of $3.9 million and expense of
$220.8 million, respectively, related to the purchase of the Sirna RNAi assets
from Merck. The company believes that the exclusion of this item provides
management and investors with supplemental measures of performance that better
reflect the underlying economics of the company’s business. In addition, the
company believes the exclusion of this item is important in comparing current
results with prior period results and understanding projected operating
performance. Management uses these non-GAAP financial measures to establish
budgets and operational goals and to manage the company’s business.

                                                            
ALNYLAM PHARMACEUTICALS, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
                                                                  
                                                           
                                                   June 30,       December 31,
                                               2014         2013
Cash, cash equivalents and total marketable        $955,897       $350,472
securities
Billed and unbilled collaboration                  89             4,248
receivables
Prepaid expenses and other current assets          10,270         3,910
Property and equipment, net                        16,953         16,448
Investment in equity securities of Regulus      49,450       45,452
Therapeutics Inc.
Total assets                                    $1,032,659   $420,530
Accounts payable, accrued expenses and other       $27,032        $20,056
liabilities
Total deferred revenue                             59,550         126,090
Total deferred rent                                3,808          4,037
Total stockholders’ equity (76.3 million and
63.7 million common shares issued and           942,269      270,347
outstanding and at June 30, 2014 and
December 31, 2013, respectively)
Total liabilities and stockholders' equity      $1,032,659   $420,530
                                                                  
                                                                  

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, 2013.

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
 
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