Wednesday, January 21, 2015

Alnylam Raises Another Half a Billion as It Rolls Out Cardiometabolic Program

There has been some confusion today why Alnylam would raise another half a billion dollars when it already has one billion in liquid assets.  The answer has probably to do with their newly formed cardiometabolic franchise (aka STAr), the first candidate from which, ALN-PCS, has just entered the clinic.

With a delivery platform that enables monthly to quarterly dosing for gene targets in the liver, RNAi can no longer be thought of as a mere second-line alternative in diseases with existing therapies or where there is direct competition with much-touted monoclonal antibodies for extracellular proteins.

For example, earlier this year, Alnylam reported early, but highly suggestive data for its subcutaneous hemophilia candidate ALN-AT3 which supported that it will work as beautiful as the genetic model behind it, and due to its monthly dosing regimen has to be considered a potential first-line therapy in a market where transitioning to weekly intravenous infusions with complex recombinant proteins is already considered progress.

Based on the non-human primate data, ALN-CC5 (going up against Alexion’s fabled Soliris) and ALN-PCS are no different.   

First cardiometabolic pearl: ALN-PCS

While all the focus in the PCSK9 space is currently on the monoclonal antibodies which are marching towards approval, ALN-PCS looks like it could shake up the market.  While up to 50-60% LDLc reductions can be expected with both the monoclonals and ALN-PCSsc, once-quarterly regimens appear feasible with ALN-PCS.  By contrast, the most advanced monoclonal antibody, alirocumab by Regeneron/Sanofi, struggles with achieving stable pharmacodynamics with just monthly dosing.  

Amgen’s evolocumab may be doing slightly better for the most part with monthly dosing, but there is still the challenge of patients with high starting levels of PCSK9- and it is still monthly and recombinant protein versus potentially quarterly and synthetic molecule.

Given that the target patient population for the PCSK9 class is expected to be in the tens of millions, clinical development for hard end points such as cardiovascular events would obviously cost a lot of money.

In the case of ALN-PCS, it is The Medicines Company that has to shoulder the costs for now.  This is because it exclusively licensed ALN-PCS from Alnylam around 2 years ago for just $25M and modest biobucks.  This deal was a great oddity because part of the reason why The Medicines Company had to pay so little is that the expectations was that ALN-PCS, at the time still the intravenously administered liposomal version ALN-PCS02, would only be used in select patient populations, such as those hospitalized with a need for rapid lipid lowering.

This profile would have obviously matched a hospital specialty company like MDCO better than a drug with the profile of ALN-PCSsc. 

In terms of value, however, I believe that ALN-PCS already is worth more than MDCO’s market cap of ~1.6B which is a function of IP issues around lead drug Angiomax and some of the more recent hospital-focused niche products it has been frantically acquiring in an effort to fill the hole should Angiomax go generic this year.  

Therefore, should the phase I results in mid-2015 support a first-in-class profile for ALN-PCS, something will have to give: either The Medicines Company splits up into a PCSK9 company and a hospital-focused entity, or (more likely) it will dispose of ALN-PCS- how about to Alnylam which would love to have it back and become the heart of the new cardiometabolic franchise?

Note: I consider MDCO the best risk:reward opportunity in biotech 2015. 

NASH, diabetes, dyslipidemia

In addition to fighting bad cholesterol by knocking down PCSK9, some of the newly raised money will be directed at other large dyslipidemic opportunities, (type II) diabetes, and the increasingly hot non-alcoholic steatohepatitis (NASH) indication.  Given its central role in system-wide metabolism, the liver is rich in targets and being able to go after every protein-coding gene alone and in combination greatly increases the odds that Alnylam (or ISIS Pharmaceuticals) come up with category-busting drugs.


I believe Alnylam was right in doing the capital raise and it could well accelerate development of the new franchise and, partly depending on the outcome of the phase I study with ALN-PCS, result in another Genzyme-type billion dollar deal next year around JP Morgan.

Read the Xconomy timely interview with Alnylam's CEO John Maraganore which further details some of the thinking here. 

16 comments:

Anonymous said...

Getting excited about monthly and quarterly gene therapy?

I wonder what the market will think about single a application approach.

Short hairpins will make them look positively backward.

Advance Australia Fare.

Anonymous said...

Does MDCO use CRO'es or stay inhouse? Would be interested to know who the CRO is if they use one.

I know MDCO had close ties to Roche and NZ. Don't know if they still do.

Anonymous said...

Would appreciate your thoughts on the following Dirk.

Am just filling the void inbetween the juggler's balls.

On smh.com.au the other day the following article was posted with this opening passage.

A string of high-profile setbacks may have whittled away support for biotechnology companies but executives and analysts say there is still plenty of money from overseas, and the weak Australian dollar may spur a series of takeovers by foreign buyers.

http://www.smh.com.au/business/low-australian-dollar-could-spur-biotech-takeovers-20150111-12lw4a.html#ixzz3PY4fmUSa

On Tuesday, Pfizer are due to present their Q4 figures. For a CEO to stand before the market to present data while ignoring the AZ elephant in the room would suggest contempt.

Davos winds up on the Friday ahead of the PFE presentation. Davos is to be attended by pharma execs and bankers.

ALNY conducts a $0.5bn cap raise. TKMR strikes terms with Oncore. Soon after begins HBV trials. RGLS is due to release data very soon with perhaps a few people of privilege already having had a peak. Mr. Kolchinsky is seen to be doing an impersonation of a ventriloquist.

I would suggest that issues surrounding patent matters will be resolved at Davos allowing PFE to make a statement about how to fill the void left by AZ. That all other matters pertain to filling this void. Including, the cheaper Australian exchange rate.

So Dirk, in your opinion can we expect to see PFE, ALNY or both make a move on Australian biotech?

Anonymous said...

Timely considering Monday is Australia Day.

Anonymous said...

Speaking of Pfizer. Novotech? Good access into Asia if it is.

Bad news for some biotechs if true. PRAN for example. Contracted with Quintiles.
----------------------------

Top CROs tight lipped about rumoured Pfizer deal

By Gareth MacDonald+, 20-Jan-2015


Quintiles has said Pfizer will “remain a customer” after analysts said the CRO lost out to a privately-owned contractor in the race to be the drug giant's third alliance partner.

http://www.outsourcing-pharma.com/Clinical-Development/Top-CROs-tight-lipped-about-rumoured-Pfizer-deal

Anonymous said...

Somebody once said there will be nothing doing until Trans Pacific Partnership talks are settled in principle. Then it was Davos.

In a strange set of circumstances, the Chief of the TPP delegation, Mr. Fromer, for the US was at Davos while TPP negotiations were kicking off in NYC.

The strange trading in TKMR calls suggests something is up.

Perhaps the post above is on the money. Noticeable is the silence of Dirk. No opinion or the subject is not worthy of one.

Anonymous said...

If Pfizer doesn't address this matter adequately next week there could be hell to pay.

I can immediately think of DNDN, TKMR, ALNY, ISIS, BLUE, DRNA, RGLS and many others that would love to take PFE as a cornerstone holder a'la Novartis in ALNY.

There must be a reason why they got involved with Benitec, spend the money on trials, then just walk away.

http://www.bloomberg.com/news/2015-01-23/pfizer-s-deal-hunt-said-to-have-included-rebuffed-teva-approach.html

In October, Chief Executive Officer Ian Read said he felt pressure to do a deal to bulk up the innovative part of the business. The loss of key patents for blockbuster drugs has left Pfizer with some revenue holes to fill. “Certainly I feel a sense of urgency on utilizing our balance sheet and our capital to do deals that are incremental, add incremental value and certainly add revenue growth in the innovative space,” Read said on a conference call with analysts in October. “We are aggressively looking at all alternatives.”

Anonymous said...

How timely to be talking about Pfizer. A quick google search reveals they were in the hunt for Teva as a back stop to the failed AZ move.

But it seems they got rebuffed there too.

Teva is a Jewish controlled, and I believe it to be a George Soros associated company.

If PFE are reaching out to Soros then that is a message to anyone with eyes and half a mind, they are in dire straits.

Watch this space for the biggest transaction in history.

Barbarians at the Gate will look like games at kindergarten.

Anonymous said...

Somebody should ban these BLT pumpers. Every post is nonsense and tries to move people to look at the turd that is BLT.

There is zero chance of Pfizer taking over Bacon Lettuce and Tomato aka BLT.

I once had funds in this turd. Years ago.

Pfizerbull

Anonymous said...

So says the self appointed spokesman of Pfizer. Like a Co. worth $200bn needs a Pfizerbull speaking for them on a blog site stating what their strategy is re gene silencing.

And ALNY is gonna rip us all a new asshole, right.

Read had better say something worthwhile tomorrow.

Anonymous said...

All comments welcome and I find this site interesting because of it.

But I agree, if Pfizer don't move soon then CEO Read is a sloth and needs to go.

MRK already gone with Moderna.

Anonymous said...

Plastic (aka Rubra) of Sharescene, please give it a rest with the pseudo intelligence on BLT etc. Worthwhile comments only are welcome.

PfizerSloth said...

Tax inversion to Australia with CSL as the target?


Jan 27 (Reuters) - Pfizer Inc :

* CEO says company doesn't need to do a big deal, would consider worthwhile acquisitions

* Says tax inversions will remain a fertile area of interest given high u.s. tax rate, depending on deal prices and conditions

Anonymous said...

When considering things like Davis, TPP, Australia Day or whatever else, if anyone is waiting for anything to happen in the US from Pfizer or anyone, then typically you need to wait til after Super Bowl at least.

Anonymous said...

How come you've never had GENE on your pick list Dirk? Look at it today. 165% plus.

Anonymous said...

What's with GENE?

Up to $4.40 in AH!

JPM discloses substantial holding in Au.

Is this a harbinger of some sort?

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