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Alnylam Pharmaceuticals Inc.’s (ALNY - Analyst Report) second quarter 2013 loss of 29 cents per share was narrower than the Zacks Consensus Estimate of a loss of 34 cents but wider than the year-ago loss of 25 cents per share. The wider year-over-year loss was primarily due to lower net revenues.

Quarter in Detail

Revenues for the reported quarter fell 58.4% from the prior year to $8.7 million. Revenues were below the Zacks Consensus Estimate of $10 million.

Revenues in the second quarter of 2013 included $3.2 million from the company’s alliance with a couple of companies, in addition to $5.5 million from its collaboration with Takeda Pharmaceutical Company Limited (TKPYY). Alnylam’s net revenues from research collaborators declined in the reported quarter as the company has already recognized its collaboration revenues from the company’s former alliance with Cubist Pharmaceuticals Inc. (CBST - Analyst Report).

Research and development (R&D) expenses went up approximately 11.5% to $24.2 million. The increase in R&D expenses was primarily due to the company’s efforts to advance its pipeline. Alnylam expects R&D expenses to increase modestly in the rest of the year.

General and administrative (G&A) expenses in the reported quarter decreased approximately 48.5% year over year to $5.8 million. The decrease in G&A expenses was primarily attributable to lower consulting and professional services expenses. Alnylam expects G&A expenses to remain consistent for the rest of the year.

Maintains 2013 Cash Balance Projection

Alnylam still expects to end 2013 with cash, cash equivalents and total marketable securities in excess of $320 million.

Pipeline Update

We are impressed by Alnylam’s efforts to develop its pipeline. In Jul 2013, the company announced positive top-line results from a phase I study on ALN-TTRsc. ALN-TTRsc is a ribo nucleic acid interference (RNAi) therapeutic targeting the transthyretin (TTR) gene that is being developed for the treatment of TTR-mediated amyloidosis (ATTR).

Alnylam plans to initiate a phase II study on ALN-TTRsc later this year depending on the successful completion of the phase I study. Positive results from the phase II study will lead to the initiation of a phase III study on the candidate in 2014. Alnylam also reported positive data from a phase II study on ALN-TTR02, another candidate in its pipeline being developed for the treatment of ATTR.

Moreover, the company is expecting several study results based on its ribo nucleic acid interference therapeutic candidates in the coming quarters. We expect investor focus to remain on the development of its pipeline.

Alnylam, a biopharmaceutical company, presently carries a Zacks Rank #3 (Hold). Other biopharma stocks, such as Actelion Ltd. (ALIOF), are comparatively well placed with a Zacks Rank #1 (Strong Buy).

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