Alnylam Pharmaceuticals Inc (ALNY) 2012 Q1 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Welcome to the Alnylam Pharmaceuticals Conference Call to discuss the First Quarter 2012 Financial Results. There will be a question and answer session to follow. Please be advised that this call is being taped at the Company's request.

I would now like to turn the call over to the Company.

Good afternoon. I'm Cynthia Clayton, Vice President of Investor Relations and Corporate Communications at Alnylam. With me today are John Maraganore, our Chief Executive Officer; Akshay Vaishnaw, Chief Medical Officer; Mike Mason, Vice President of Finance and Treasurer; Laurence Reid, Chief Business Officer; and Barry Greene, President and Chief Operating Officer.

For those of you participating via conference call, the slides that we have made available via webcast can also be accessed by going to the investors' page of our website at www.alnylam.com.

During today's call, as outlined in slide two, John will provide some introductory remarks and provide general context. Akshay will summarize our clinical progress. Mike will review our financials and guidance. And Barry will provide a brief summary of our business highlights and goals before opening the call to your questions.

Before we begin, and as you can see on slide three, I would like to remind you that this call will contain remarks concerning Alnylam's future expectations, plans and prospects, which constitute forward-looking statements for the purposes of the Safe Harbor Provision 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 those discussed in our most recent annual report on file with the SEC.

In addition, any forward-looking statements represent our views only as of the date of this recording and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligations to update such statements.

I will now turn the call over to John.

Thank you, Cynthia. Welcome and thanks to everyone for joining us this afternoon.

As Alnylam celebrates its tenth anniversary next month, we have never been positioned better to execute on our mission of building a top-tier bio-pharmaceutical company founded on RNAi.

Indeed, as you can see in slide four, the past period has been one of remarkable accomplishments in our scientific and clinical development efforts, with positive results in three clinical programs, including chemo proof of RNAi mechanism in our ALN-VSP liver cancer program, human proof of concept in our transthyretin mediated amyloidosis program, and clinical efficacy in our ALN-PCS severe hypercholesterolemia program.

These results confirm what we have always believed, namely that RNAi can be harnessed and manned to create a whole new class of high impact innovative medicines.

Turning specifically to activities in the first quarter of 2012 and the recent period, we made significant clinical and business progress focused on our Alnylam 5x15product strategy for the development and commercialization or RNAi therapeutics.

Just a couple of weeks ago we reported extremely encouraging clinical data from our Phase I ALN-PCS trial for the treatment of severe hypercholesterolemia. We also recently initiated dosing in our Phase I clinical study with ALN-TTR02 an RNAi therapeutic targeting the transthyretin gene for the treatment of transthyretin mediated amyloidosis. And we are on track to report clinical data from this study in the third quarter of this year.

We also made excellent progress in our hemophilia program, and we look forward to updating you on this effort in the months to come.

These important accomplishments, combined with the recent strengthening of our balance sheet, gives us great confidence in the continued execution of our Alnylam 5x15product strategy, which is focused on advancement of RNAi therapeutics directed toward genetically defined targets for diseases where there are limited treatment options for patients and their caregivers.

I'll now turn the call over to Akshay for more a more detailed review of our clinical activities, our pipeline progress, and also our scientific accomplishments. Akshay?

Thanks, John. And hello, everyone. As John mentioned, we continue to make important progress in advancing our Alnylam 5x15programs in the clinic.

I'll start with a review of clinical data presented just a couple of weeks ago from our ALN-PCS program, as noted on slide seven, which targets PCSK9 for the treatment of severe hypercholesterolemia. These exciting results show very robust, statistically significant and dose dependent not found of PCSK9, and lowering of LDL cholesterol levels in a single dose study performed in the absence of statin.

The Phase I study was conducted as a randomized placebo control single ascending dose study in healthy volunteers with elevated baseline LDL cholesterol. The primary objective of the study was to evaluate safety and tolerability of ALN-PCS. Secondary objectives included assessment of pharmacodynamic effects on plasma PCSK9, protein levels, and evaluation of clinical efficacy as measures by LDL cholesterol levels.

A total of 32 subjects were enrolled into six dose cohorts ranging from 0.015 to 0.4 milligram per kilogram. In this study, as you can see on slide eight, a single dose of ALN-PCS resulted in rapid dose-dependent and durable reductions in LDL cholesterol of up to 50% relative to baseline and placebo, with a statistically mean reduction of 41% at the highest dose. In addition, ALN-PCS administration resulted in rapid dose-dependent durable knock-down of PCSK9 protein levels in plasma of up to 84% relative to baseline placebo, with a statistically significant mean reduction of 68% in the highest dose group.

ALN-PCS was shown to be generally safe and well-tolerated in this study, and there were no serious adverse events related to study drug. There was no significant change compared to baseline in levels of HDL cholesterol, consistent with the phenotype observed in human PCSK9 loss of function mutations.

We're very excited by these new ALN-PCS data that once again demonstrate robust clinical efficacy for RNAi therapeutics.

As you can see on slide nine, ALN-PCS has a unique mechanism of action since it inhibits the synthesis if PCSK9 in lipid cells, thereby reducing both its intracellular and extracellular functions, and thus provides a differentiated strategy for PCSK9 antagonisms in comparison to the [monatrin] antibodies under development for this drug.

Specifically, this mechanism of action results in potent and durable LDL cholesterol reductions enabling once monthly dosing and potential synergistic effects with statins. In addition, ALN-PCS's novel mechanism enables consistent clinical activity across a wide range of patient PCSK9 plasma levels, including individuals with very high PCSK9 plasma levels.

We believe these differentiating factors could be very important in the development of PCSK9 agents and will be important to the partnership we are able to form prior to initiating a Phase II study.

In the meantime, these data mark yet another important milestone in our Alnylam 5x15efforts as they demonstrate continued safety, tolerability and robust clinical efficacy of an RNAi therapeutic (inaudible) a liver expressed disease gene utilizing our second generation lipid nanoparticle delivery technology, the same delivery formulation we're currently using in ALN-TTR02.

Now, turning to our ATTR program, we continue to make rapid clinical progress with this very exciting effort, with developing ALN-TTR for the treatment of transthyretin amyloidosis, or ATTR, a devastating, inherited orphan disease affecting the nerves and heart. Our RNAi therapeutic aims to reverse disease by silencing the disease-causing gene, TTR.

As you will recall, late last year we reported positive preliminary clinical results from our first generation ALN-TTR01 Phase I study showing statistically significant reductions in serum TTR protein levels in ATTR patients. ALN-TTR01 was found to be well-tolerated in the study.

These results, as highlighted on slide 10, were very important since TTR is the pathogenic protein in this disease, and we've demonstrated that we can knock it down in ATTR patients.

We'll be presenting the final data from this trial next week at the ISA meeting. These encouraging data, combined with many improvements we've made in our delivery technology, as evidenced in our ALM-PCS trials, give us great confidence in our second generation product, ALN-TTR02, which we believe will be our go-to-market product for this program.

ALN-TTRO2 is comprised of the same RNAi as ALN-TTRO1, but it's formulated in the more potent second generation ALNP which uses the propriety Alnylam lipid, MC3.

In March, we initiated a Phase I clinical trial with ALN-TTRO2. This trial is being conducted in the U.K. as a randomized, single-blind, single-ascending dose study, enrolling 32 healthy volunteer subjects. The objectives of the study are to evaluate safety and tolerability, as well as clinical activity, as (inaudible) serum TTR levels following a single dose of ALN-TTRO2, with subjects being enrolled into five sequential dose cohorts ranging from 0.01 to 0.15 milligram per kilogram.

This trial is well underway and we're on track to report data in the third quarter of this year. We also expect to initiate a Phase II multi-dose study of ALN-TTRO2 in ATTR patients in the second half of 2012.

And, assuming positive results, start a pivotal trial for ALN-TTRO2 in 2013. In addition, in January, we also announced plans to advance subcutaneous delivery asset in our ATTR program, utilizing a GalNAc-conjugate delivery approach. This approach provides an opportunity for product differentiation in the ATTR indication.

Turning to slide 12, another area of focus for us with our Alnylam 5x15strategy is our hemophilia program. Alnylam is developing ALN-APC for the treatment of hemophilia, an inherited orphan bleeding disorder. Our RNAi therapeutic is a completely new approach which resets the clotting cascade to stop bleeding by silencing protein C, a genetically defined target.

This strategy has been validated in human genetics based on the co-inheritance of prothrombotic mutations in hemophilia patients, where these patients exhibit significantly reduced bleeding complications.

We have plans to present updated pre-clinical data from this program at the World Federation of Hemophilia in July 2012, and will continue to advance this program toward the clinic with the goal of initiating a Phase I trial in the first half of 2013.

And as you can see on slide 13, we also continue to advance other Alnylam 5x15programs, including our ALN-TNP program for the treatment of hemoglobinopathies and our ALN-HPN program for the treatment of refractory anemia.

ALN-TNP comprises systemically delivered RNAi therapeutic targeting Tran membrane protease, serine 6, or Tmprss6, for the treatment of hemoglobinopathies, including beta-thalassemia and sickle cell anemia. Alnylam plans to pilot this program prior to conducting a Phase I study.

Alnylam also plans to partner ALN-HPN program which targets the hepcidin pathway for the treatment of refractory anemia prior to conducting a Phase I study.

With that, I'd like to turn the call now over to Mike for a review of our financials. Mike.

Thanks, Akshay. And good afternoon, everyone. Please refer to slide 15 in our deck.

We continue to maintain a strong financial profile, ending the first quarter of 2012 with $316.9 million in cash, cash equivalents and marketable securities. Our cash position increased this quarter as the result of a public offering of common stock that we completed in February as showing 8.6 million shares of common stock and generating net proceeds of approximately $87 million.

Our GAAP revenues for the first quarter of 2012 were $20.6 million, as compared to $20.9 million the first quarter of 2011. We continue to record the amortization of up-front payments from the strategy alliances that we have formed, which account for significant and recurring portion of our quarterly GAAP revenues.

Looking ahead, the amortization of Roche Arrowhead revenues, which represented approximately $14 million in the first quarter of 2012, will come to its planned end during the third quarter of 2012.

Moving to expenses, R&D expenses were $21.1 million in the first quarter of 2012, as compared to $26.3 million in the prior year period. This decrease was due primarily to lower clinical trial and manufacturing costs related to our ALN-RSV and ALN-VSP programs, and was partially offset by a one-time charge of $3 million related to the corporate restructuring we implemented in January.

G&A expenses were $10.4 million in the first quarter of 2012, including a restructuring charge of $900,000, as compared to $10.2 million in the prior period.

With respect to guidance for 2012, we believe we will finish the year with greater than $250 million in cash. And, in summary, with the financing we completed in the first quarter, combined with our corporate restructuring, results in a balance sheet and operating plan that we believe will enable us to continue to advance our Alnylam 5x15product strategy.

This concludes the financial highlights. And I'll turn the call over now to Barry.

Thanks, Mike. As you've heard this afternoon, we're demonstrating with human clinical data that the RNAi pathway can be harnessed to create high impact, innovative medicines. We continue to focus on our Alnylam 5x15efforts with what we believe to be our highest value opportunities, driving key programs toward pivotal trials.

This includes accelerated clinical development plans for ALN-TR02 for the treatment of ATTR, a devastating and debilitating genetic orphan disease affecting the nerves and heart. It also includes our RNA therapeutic for the treatment of hemophilia, which believe represents an exciting opportunity that could fundamentally change the management of this inherited orphan bleeding disorder.

Now, in addition to our Alnylam 5x15programs, we've a number of programs focused on other disease indications, as noted on slide 17, that we are advancing with existing partnerships or with partnerships that we expect to form in the future. These programs include ALN-VSP for the treatment of liver cancers, where we expect to report updated data at ASCO, and also our ALN-RSV program, which remains blinded, and where we expect to report results in mid-2012.

Regarding our Huntington's Disease program, today we announced that consistent with our value creation strategy and as part of the alignment of resources on our Alnylam 5x15programs, we have elected to exercise our option to opt out of the 50-50 expense arrangement with Medtronic and CHCI.

This decision gives us the opportunity to receive future milestones and royalties on this program without the need to co-invest on a 50-50 basis. Medtronic has indicated their continued interest in the development of ALN-HTT, and we look forward to assisting them and are committed to assisting them in these efforts.

Also, as a result of our increased focus in 2012 and beyond, in January we implemented an organization restructuring, which included an approximate 33% reduction in our workforce. This was a very difficult decision to make, but we are confident that it was an important step in continuing to build our company for the long term.

I will note that we are extremely grateful to all our employees, past and present, for their dedication, passion and commitment in advancing RNAi therapeutics to patients.

As Mike mentioned, we strengthened our balance sheet this quarter and remain poised to execute on our goals, as detailed on slide 18. Specifically, key goals we are focused on include reporting on the complete Phase I data for ALN-TTR01 this month at the ISA meeting, reporting on our Phase I data for ALN-TTR02 in the third quarter, initiating our Phase II study for ALN-TTR02 in the second half of the year, putting us on track to start pivotal trials in 2013, reporting an update on our pre-clinical results in our hemophilia program, as Akshay mentioned, at the WFH meeting in July, while advancing this effort towards start of clinical in the first half of next year, partnering our ALN-PCS program prior to the start of Phase II and advancing other Alnylam 5x15programs toward Phase I with partnerships we aim to form.

We'll also, as we mentioned, be reporting on our ALN-RSV Phase IIB study in mid-year, and advancing our ALN-VSP liver cancer program into Phase II with a partner.

As I previously mentioned, we're going to be supporting Medtronic and CHDI in our efforts with ALN-HTT, and form additional partnerships on programs in technology. Importantly, we remain consistent in our guidance of ending the year with over $250 million in cash.

Clearly, it's been an eventful and highly productive quarter and we're looking forward to continued progress, including clinical data, over the coming months.

With that, I'd like to turn the call back over to the operator for your questions. Clarissa, we'll now take questions. Thank you.

(Operator Instructions). And your first question comes from the line Charles Duncan with JMP Securities. Please proceed.

Hi. This is Gina Wong on behalf of Charles Duncan.

How are you?

I'm good. I basically have two questions around the TTR program. First question is I wonder what would be the primary endpoint for the Phase II and the pivotal trials? And the second one is kind of following the same line.

I'm wondering what would be your thoughts on the competitive landscape since [Vanderquil] will have [federate] coming and Isis is also developing a similar drug for FAP and maybe a little bit faster than the TTR02 program. So, wondering about your thoughts on the competitive landscape?

Sure. Those are two great questions. So, I'm going to have Akshay answer the first question in the endpoints. And then Barry answer the second question on the competitive landscape. So, Akshay, you start.

Sure. So, with respect to the endpoints, we're very excited to announce that we will, indeed, be initiating the Phase II study in the second half of the year. And, you know, the goal of that study essentially, apart from safety and tolerability, is to consolidate our view of the pharmacodynamics activity of our drug ALN-TTR02.

And we're confident that we'll show, in a very impressive knockdown with the TTR02 product which shares the same potent second generation LNP, as with LNP-PCS. And, of course, we've all just seen the very exciting PCS data.

So, I think all bodes well there in terms of safety and NPD. And that will take us to the Phase III study, which you mentioned, which we hope to start in 2013. And we believe the clinical endpoint there in FAP patients will be a composite measure of the neuropathy that has been termed NISLL -- N-I-S-L-L -- and that was used by the Vanderquil folks in their Phase III study and is now, obviously, validated and has a lot of infrastructure around it, including clinical interpretability and level of clinical benefit (technical difficulty). So, you know, we're very excited about all of that. And I think we're in good shape.

And, Barry, you want to comment on the competitive landscape?

Yes. As we've mentioned on the call, TTR mediated amyloidosis is an incredibly painful, devastating and debilitating disease. People are dead within five to 15 years. So, when you think about TTR mediated amyloidosis, both the polyneuropathy and the cardiomyopathy, you want to do everything you can for these patients. And as typical with these kind of devastating diseases, we see it with cancer, multiple drugs will be used over the course of time to help these patients out.

What you want to do with these patients is, as Akshay mentioned, remove the insulting protein -- in this case it's transthyretin -- which will have the amyloid plaques reversed causing a reversal of the disease. When we think about ALN-TTR02 and once a month dosing that removes the insulting protein, we believe that we have absolutely the best drug profile out there. And, ultimately, with the reversal of disease, we'll have the best drug for treating TTR mediated amyloidosis.

We don't see tafamidis as a deterrent. In fact, patients may, combined with tafamidis what you're doing there, you're binding the protein. And you have to remove the protein. And in terms of Isis' program, as I mentioned, this is a kind of patient population where multiple drugs will be used over time and we really like our profile the best.

So, the bottom line on that is we believe we will have the best in class drug in this indication. Bottom line.

Thank you. And congratulations on the program.

Thank you.

And your next question comes from the line of Mike King with Rodman and Renshaw. Please proceed.

Hi, Mike.

Good. Can you hear me okay?

Sure.

All right. My apologies in advance for any background noise. I wanted to ask a strategic question about the decision on PCSK9 with regard to partnering at this juncture. While I would view the data as extremely encouraging, I also think there's a lot of questions that need to be answered. And if there's a partner sitting across the table from you, these are kind of the items that repeat those combinations of statins, et cetera, that they'll try to ding you for on the value of your program.

So, could you talk a little bit about how you feel that the program has advanced enough now to add the kind of value to your shareholders that they really should receive from the program?

Yes. Well, let me make some comments and then maybe Laurence Reid who is here can also comment. Mike, the PCSK9 data that we generated I think are incredibly exciting. Obviously, the next steps in the program it would be clearly to do combination studies with ALN-PCS with statins. And I think that's very, very clear cut, as well as to do multi-dose type studies.

And so, these are things that are clearly in front of the program in terms of the next steps. It's really our belief that the current data set provide an amazing level of de-risking of the program and really take the program to a position of its performance that is at its stage today wonderfully strong to form a partnership. I mean, obviously, one can continue to invest and always make things better and strong over time.

But you have to balance that as a company with the other organizational aspects of what you're doing, which, of course, has been a major focus within the Company on advancing ALN-TTR02 in hemophilia where we think the competitive landscape and our overall ability to play ultimately in those commercial marketplaces is stronger proportional to where it would be in the hypercholesterolemia space.

So, I think we're making an overall integrated business decision around the effort, which at the end of the day factors into our decision to partner at this current juncture point. I mean, Laurence, you should comment as well from a market standpoint as you've been out there talking to potential partners.

Yes. I think the interest has been generated in this field, this PCSK9 field, particularly over the last year or so as some of the antibody pharmacologies come along is very significant (inaudible) and estimates of the market as can be associated with PCSK9 pharmacology in years to come.

And we believe that our therapeutic, having a different modality, a different mechanism of action, (inaudible) to have broader molecular pharmacology in the antibodies by acting inside and outside the cell, as we've discussed. That all of that makes our drug a very attractive opportunity in this marketplace. And, obviously, we'll see how that plays out precisely in negotiations and deal discussions.

But there are many pharmaceutical companies and biotech companies out there who don't have a problem playing in this area who have a strategic commitment to the cardiovascular area who, I think, are interested in an alternative modality relative to the antibodies and realize this is a massive market. And any form of therapeutic has a long way to go from here to get to the market, to actually get into the commercial marketplace. And it's those factors that are generating interest that we're seeing in the program.

Mike, there's clearly going to be a significant number of players that ultimately make it to the marketplace with this target. And having the only approach out there that is based on PCS (inaudible) synthesis inhibition, which we think is a very important differentiated mechanism, we think makes it a compelling value opportunity.

So, we'll play this out. We're excited about where it can go with a partner. And in an integrated way we're ultimately making decisions about how we allocate resources across a lot of really exciting programs. And we just can't do everything.

Yes, I know. I'm not asking you to do everything. It just seems like the incremental investment here with respect to your proprietary programs wouldn't be all that great, compared to the incremental increase you could realize in terms of your economic retention of the program. I mean, one of two additional doses; maybe a little correlation between PCSK9 gene knockdown and protein. Some other things that help to inform that don't cost a lot, but could be worth whatever. Some multiple in terms of payments or downstream royalties.

Yes. All very valid points, Mike. Obviously, we're thinking about all these things as well. And these are just judgment calls as to where we think we can get the most value and the best value. And we'll see how well that plays out.

Okay. Thanks.

And your next question comes from the line of Ted Tenthoff from Piper Jaffray. Please proceed.

Great. Thank you very much.

Hey, Ted.

How are you guys?

Great. Couldn't be better.

Good. I'm glad to hear that, John. A question around the HTT program and the decision to not continue to invest here. This is one that has been -- you guys have been working on for a long time with Medtronic. Can you give us a little bit more color on that decision? Is it based on delivery? I know it's been a long time to get this thing moving towards the clinic. So, can you give us a little more on that decision?

Yes, I can. And I think Akshay and Barry may want to comment as well. It's a very exciting program and it's really a program that, for a lot of reasons, has generated some very compelling data in a number of animal models, both rodent models and also non-human primate models. But it's a program that, of course requires the use of an implantable infusion pump technology.

And therefore, for reasons that I think anybody who understands drug development would understand, is a much more complicated program than other programs that we have in our pipeline. It's also a program that, in the context of clinical development, doesn't have the types of things we like in our Alnylam 5x15programs, namely a very early biomarker that we can measure in Phase I. It's got a longer type of timeframe.

So, we've always had the option in the agreement with Medtronic to either continue to co-invest on a 50-50 basis and share the spoils at the end of the day, or the option to essentially opt out and become a milestone of royalty player. And we're just making a fundamental business decision consistent with our overall focusing of efforts on TTR and hemophilia, for the most part -- at least in the near term -- and then other Alnylam 5x15programs longer term that puts that program into the bucket where being a milestone of royalty play for Alnylam is a pretty damn good place for us to have it.

Barry, if you have other thoughts?

Yes. I think you covered it. And, Ted, consistent with really the strategy that we set out at the beginning of last year, we've solved delivery to the liver. WE know exactly how it works and it works eloquently. We've got two platforms to deliver it -- LNPs and conjugates. And we've got programs that will be in pivotal trials in short order where we see significant commercial opportunities in that kind of value-creation timeframe between now and 2015.

So, this is consistent with that. The good news is the program got to the stage where we had understood way ahead of time via the contract that we could, in fact, opt out and move to a different arrangement seamlessly where we will continue to supply support for the program.

So, it's following the strategy exactly. We're excited about the program. But it really makes sense for us to drive TTR and hemophilia to pivotal trials and to the market for the greatest value creation.

That's great. That's really helpful -- additional color. And since Laurence is sitting with you guys, can you give us sort of an update on the general partnering interests of RNA medicine here? I really think that we hit a low two years ago and that with some of the important data that you guys have reported in terms of validating RNAi as a mechanism, also some of the other technologies that are targeting RNA. I've sensed a shift in interest. And I just want to see if you guys are sensing that from potential partners in discussions?

Laurence, you want to handle that?

Yes. We've definitely seen a shift from a sort of parochial view. I mean, I've been here formally two years now and even over those two years I think seeing the same trend that you're referring to, Ted, relative to where the attitude has gotten to over the previous period of time.

And I think particularly over the last six months since the two sets of clinical data came in, the TTR data around Thanksgiving, and the PCSK9 data over the last quarter, that I think the belief in the demonstration of molecular pharmacology in human beings is very compelling and brings people to a discussion who probably a year ago were really sitting on the sidelines watching. I think how that plays out exactly in terms of the deals and the kinds of deals we'll do in the coming months remains to be frank.

And I guess it's also fair to say that there are still some pharmaceutical companies who prefer looking for more advanced clinical data than we've yet produced.

But I think, overall, the mood change and the willingness to entertain the discussions and to talk about products like PCSK9 will get a lot of incoming interest in our TTR amyloidosis program and the rest of the pipeline. I would say it's changed significantly on the back of the clinical data over the last several months.

Of course, the case of our TTR program, Ted, you know we're not partnering that program, at least for the vast majority of the world.

Yes. Thank you for the update.

Thanks, Ted.

(Operator Instructions). And the next question comes from the line of Alan Carr with Needham and Company. Please proceed.

Hi, guys. This is Mark on for Allen. Thanks for taking my call.

Hi, Mark.

I was wondering if you guys might be able to give us a little bit of an update on various ongoing litigation?

Yes. Mark, it's hard for us to say very much about ongoing litigation other than we don't comment about ongoing litigation. But I think what we can say is we are as convinced as ever that the suit that was brought against us by Tekmira is completely without merit. It is baseless. And we will defend ourselves fully in that suit. And we will be meritorious. And that's all we can say.

Okay. That's good. I also wanted to ask about the RSV program. I know it's difficult to say in general what data do you expect to be getting from that, but what kind of data are you expecting to gain from that? What's going to happen with positive data? How does that affect your relationship with Cubist going forward?

I'll let Akshay comment on that in a minute. But let me just remind you Mark and others that the RSV Phase IIB study that is current blinded is an effort to reproduce a very interesting finding in a small -- underscore small -- Phase IIA study that was done a couple years back.

And we've been very clear with people that, obviously, we're looking to reproduce a finding in a small study and very often when you do an effort to reproduce a finding in a small study, it doesn't reproduce. And so we've been clear with people that it's not at all clear if this is going to report out a positive result, or a negative result, for that matter. We did it because we believe that there might be an opportunity for a positive result.

But it's certainly not a program because it is partnered with Cubist that is our core sweet spot of Alnylam 5X15.

That said, we did the experiments in Phase IIB with the goal of seeing a positive result. And we'll see how that plays out the middle of this year. But I'll leave it to Akshay to comment further on the types of data that we'll be seeing. Akshay?

Yes. So, in terms of the types of data, Mark, the small Phase IIA study that John mentioned, which showed an impact on incidents of bronchiolitides of [litrans], which is a syndrome of the narrowing of the airways in the transplanted lung after an RSV infection, in fact, a devastating and very serious complication -- within five years 50% mortality after its onset. And so it was clearly a worthwhile goal to pursue to understand that benefit further.

And so the study, which is fully enrolled, the primary endpoint was going to read out at six months comparing LNR RSV01 to placebo in lung transplant patients treat -- RSV infected lung transplant patients with one or the other. And the primary endpoint is going to be just that. The study was powered to show superiority of RSV01 against placebo for the bronchiolitides of (inaudible) endpoint. And around mid-year we should get the data and we'll be happy to report them.

Obviously, there will be safety. There will be lung function tests that will be done along the way. There will be symptoms, of course. But, those are really the highlights that we'll be looking for.

And you know, in terms of Cubists, obviously, when we get the data, we'll sit down with our partners, Cubist, and also Kyowa Kirin, who are our partners in Japan and Asia. And we'll certainly discuss the results with them. But that's the next step -- to really do the unblinding and get the results, get the data and analyze the results, communicate them to the outside world and communicate them with our partners.

Great. All right. Thanks very much for taking my questions.

Not a problem. Thanks, Mark.

And the next question comes from the line of Steven Willey with Stifel Nicolaus. Please proceed.

Good afternoon. Thanks for taking my question. Just a quick question on TTR-SE. Just wondering when you plan on having the GalNAc-conjugate delivery version into the clinic? And I guess if that would influence your plans on the version of protein C that you intend to move forward for hemophilia?

That's a great question. First of all, the conjugate platform is an exciting development at Alnylam that builds off the work that we've been doing since 2004, actually, which is when we published our first paper using conjugates.

But more recently, over the last two years in particular, using a GalNAc targeting to the (inaudible) glycoprotein receptor in hepatocides, we've been incredibly successful with developing simple conjugates of sRNAs for delivery. TTR sub-Q will be -- the goal is to file our RND in the second half of this year. So, if all go well, this time next year we'll have clinical data from that study.

And then, obviously, we're looking at any of our 5x15programs where there might be a competitive advantage of using a sub-Q delivery for the opportunity of using our conjugate platform, as compared to our LNP platform.

And it does weigh into our developing candidate decision for the hemophilia program, which we'll be making by the second quarter of this year. And we're looking forward to update people at the World Federation of Hemophilia meeting that will be taking place in July. And so, I'd say stay tuned until then to know a little bit more about the path forward on that program.

But I think it's fair to say that having the luxury of multiple delivery technologies, both the LNP platform as well as the sub-Q conjugate platform, has really -- both of which are very efficient toward the liver -- and liver [express target] genes -- has really strengthened our fundamental strategies for product development in the Company.

That's helpful. And then with respect to the patent that was received today, I guess, regarding the TTR gene. Can you maybe just talk a little bit about what that covers?

Yes. It's real simple. It covers the sequence of our sRNA that's used in our drug. So, it is the TTR02s sRNA structure composition of matter that's covered in that patent. So, it's a pretty important patent from a product development standpoint, a product commercialization standpoint.

Okay. Thank you very much.

Sure. Thanks, Steve.

And another question from the line of Mike King with Rodman and Renshaw. Please proceed.

Thanks for taking the follow-up. I just wanted to find out. I got on the call a little bit late so I want to make sure -- you said pivotals for TTR02 in early '13. Is that correct?

No. The guidance has been in '13.

In '13. Okay. And just a question for Akshay. What do you envision in terms of duration of therapy, number of patients, et cetera?

Mike, we're still in the planning stages, so it would be premature before we've completed our diligence and had all the appropriate conversations with regulators and so forth.

Right.

Just as a rough guidance just to show you what was done for the tafamidis, a 120-odd patient study. And they studied patients for about 18 months. And one of the things you want to remember in terms of duration of treatment with a drug that's attempting to look at neuropathies, neuropathies are slow in onset and are supposed to get better.

When they get better, we're remarkably fortunate with a drug that will take away the pathogenic proteins and we're optimistic about stabilization, and probably improvement in the neuropathy. But it's not going to be days and weeks. It's certainly a significant period of time. So, more to come.

And do you think you're going to have to go on top of tafamidis, or do you think in a population that would not necessarily get tafamidis?

As I was discussing earlier, we see scope for this drug in many different respects. But one thing that's important is we think we'll be the best in class. We're going to have a therapeutic that's once a month, or maybe even less frequent, with very significant knockdown in both (inaudible) protein and will do, because of that type of potency and convenience, will do more for these patients than anything tafamidis -- or any other drug, we believe -- could do.

Certainly, there's the possibility to combine it with tafamidis. We don't see that as an impossibility. But given the confidence in the [likely] profile, we think we're going to have best in class.

And then just quickly, when do you think you'll do cardiomyopathy?

We're very excited about that opportunity as well. Thanks for bringing that up. That is another major problem for these patients. We want to get through the Phase II study that will start in the second half of this year. And the emerging confidence we'll have from the program, the combination of lots of safety data by then and lots of PD data, both in (technical difficulty), I think we'll define the final plan, not just for the pivotal in 2013, but also for (technical difficulty).

Okay. Great. Thanks. I appreciate all the answers.

Thanks, Mike.

At this time there are no further questions in queue.

Good. Thanks everyone. Alnylam continues to lead the advancement of RNAi therapeutics to patients. And we are extremely proud of our recent clinical and business accomplishments. And we're excited to share lots of interesting news and exciting news in the months to come. So, stay tuned. Bye now.

Ladies and gentlemen, that concludes today's conference. Thank you for your participation. You may now disconnect. Have a wonderful day.