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Why Is Alnylam (ALNY) Down 16.8% Since Last Earnings Report?

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A month has gone by since the last earnings report for Alnylam Pharmaceuticals (ALNY - Free Report) . Shares have lost about 16.8% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Alnylam due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Alnylam Reports Narrower-Than-Expected Loss in Q1

Alnylam incurred adjusted loss of $1.42 per share, wider than the year-ago loss of $1.22 but narrower than the Zacks Consensus Estimate of a loss of $1.84.

Revenues increased 52% year over year to $33.3 million and beat the Zacks Consensus Estimate of $21.95 million. The top line in the quarter included net product revenues of $26.3 million from sales of Onpattro (patisiran), which was approved by the FDA in August 2018. Net revenues from collaborators were $7 million in the first quarter compared with $21.9 million in year-ago quarter.

Quarter in Detail

Alnylam received 77 Start Forms in the United States in the first quarter, with more than 90% from newly-identified patients, who were not previously treated in the Onpattro Expanded Access Program.

Further, the company reports continued strength in the number of patients receiving Onpattro in the United States from channels outside the Alnylam Assist patient hub, where the company does not receive Start Forms.

Adjusted research and development (R&D) expenses increased 30.3% from the year-ago period to $113 million. Adjusted selling, general and administrative (SG&A) expenses increased 17% from the year-ago quarter to $73.7 million.

2019 Guidance

Alnylam updated its guidance for adjusted operating expenses in 2019. The company expects adjusted SG&A expenses to be $390-$410 million, changed from the previous guidance of $390-$420 million. Adjusted R&D expenses are expected to be $550-$590 million, changed from the prior guidance of $520-$560 million. The company also expects its current liquid resources to fund its operations approximately for multiple years at the current pace of cash burn.

Pipeline Updates

During the quarter, the company obtained regulatory alignment with the FDA on the design of its phase III study, which will evaluate Onpattro in hereditary and wild-type ATTR amyloidosis patients with cardiomyopathy. The study is expected to start in mid-2019. The drug is also under review in Japan and Canada.

In mid-2019, the company also expects to initiate the APOLLO-B phase III study of patisiran in hereditary and wild-type ATTR amyloidosis patients with cardiomyopathy.

During the quarter, the company continued enrollmentin the HELIOS-A study on vutrisiran (ALN-TTRsc02), a subcutaneously-administered investigational RNAi therapeutic as a treatment for hATTR amyloidosis with polyneuropathy. Alnylam also plans to initiate another phase III study, HELIOS-B, on the candidate in hereditary and wild-type ATTR amyloidosis cardiomyopathy in late 2019.

The company achieved positive results in the ENVISION phase III study for givosiran, an investigational RNAi therapeutic in development for the treatment of acute hepatic porphyrias (AHPs). Alnylam is on track to complete submission of a new drug application (NDA) and submit a Marketing Authorisation Application (MAA) for givosiran in mid-2019.

Alnylam continued enrollment in the ILLUMINATE-A, a global phase III study of lumasiran in children and adults with primary hyperoxaluria type 1 (PH1). The company expects to report top-line results from the study in late 2019. The company initiated ILLUMINATE-B, a phase III pediatric study of lumasiran in PH1 patients under six years of age.

In October 2018, Alnylam’s partner, The Medicines Company, announced that the Independent Data Monitoring Committee for the ongoing inclisiran phase III clinical trials (ORION 9, 10, and 11) conducted its sixth planned review of safety and efficacy data from the studies and recommended that the studies continue without modification. The company’s another partner, Sanofi, is currently enrolling patients in phase III ATLAS program evaluating fitusiran for the treatment of hemophilia An or B.

Collaborations

The company announced a broad collaboration with Regeneron Pharmaceuticals, Inc. to discover, develop and commercialize RNAi therapeutics focused on ocular and CNS diseases. The transaction is expected to close during the second quarter of 2019.

The company announced the conclusion of the research and option phase of its 2014 collaboration with Sanofi focused on advancing RNAi therapeutics for rare genetic diseases.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates flatlined during the past month.

VGM Scores

Currently, Alnylam has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Alnylam has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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