Alnylam Earnings: Strong Commercial Execution Drives Growth; Pipeline Continues To Make Progress

Alnylam ALNY reported strong first-quarter results highlighted by $276 million in net product revenue, representing 48% year-over-year growth. Amvuttra, which received FDA approval in June 2022 for hATTR amyloidosis with polyneuropathy, is continuing its strong launch with over $102 million in sales, accounting for 27% of the quarter’s sales. Alnylam’s results are largely tracking our forecasts, and we maintain our fair value estimate of $199 per share. We view shares as fairly valued, and the stock is trading in 3-star territory. We maintain our narrow economic moat rating and positive moat trend.

Alnylam’s narrow moat is supported by the intangible assets from its proprietary RNAi technology and lengthy patents extending to 2035. Alnylam’s positive moat trend is based on the continued progression of its diversified drug pipeline for many rare diseases with high unmet needs, which will likely support pricing power if the drug candidates receive approval. Alnylam and Regeneron reported positive interim Phase 1 clinical results for ALN-APP, an investigational RNAi therapeutic for the treatment of Alzheimer’s Disease and cerebral amyloid angiopathy. While ALN-APP is in the early stages of development, the encouraging clinical data is promising and further supports our positive moat trend rating.

Alnylam remains in a healthy financial position with over $2 billion in cash and marketable securities at the end of the quarter, which will allow the company to continue funding its pipeline and commercialization efforts. Given the many late-stage trials in progress and efforts to commercially expand Oxlumo and Leqvio, we forecast Alnylam will remain unprofitable until 2025. We also expect collaboration partnerships, such as its agreements with Regeneron and Novartis, to mitigate the hefty operating expenses required to put candidates through clinical development.