Why Alnylam Pharmaceuticals, Inc. Took a 47.5% Dive in October

By Markets Fool.com

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What happened

Shares of RNA interference hopefulAlnylam Pharmaceuticals, Inc. (NASDAQ: ALNY)took a 47.5% leap downward in October, according to data from S&P Global Market Intelligence. Bad news from data monitors caused the clinical-stage biotech to throw in the towel for a candidate in late-stage development.

ALNY data by YCharts

So what

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Alnylam was founded a little over 14 years ago. It doesn't have anything to sell yet, and last month's developments suggest it'll be stuck in the pre-commercial stage for even longer than expected.

The biotech had two candidates in phase 3 trials for thetreatment of inherited disorders caused by misfolded clumps of transthyretin, a vital protein that transports a thyroid hormone and vitamin A throughout the body. Alnylam halted development of revusiran for thetreatment of familial amyloid cardiomyopathy (FAC) when the independent data-monitoring committee assigned to its pivotal trial uncovered a disturbing trend: A higher number of patient deaths in the group receiving the experimental drug shattered its risk-to-benefit profile.

Unfortunately, the reason the data monitors cracked open the revusiran data involves Alnylam's only remaining candidate in phase 3: patisiran for thetreatment of familial amyloid polyneuropathy (FAP). Recent reports of new or worsening nerve damage in patients treated with patisiran from a phase 2 study that was previously considered successful led independent data monitors to examine data from ongoing phase 3 studies with revusiran and patisiran.

Now what

For now, the data monitors recommended continuing patisiran's phase 3 FAP trial, and we can expect top-line data about halfway through next year.If the candidate earns an approval for FAP, the reports of new nerve damage from its completed phase 2 trial won't help a subsequent commercialization effort in an already limited patient population.FAP affects about 10,000 patients worldwide, a group about one-fourth the size of the FAC population revusiran was aimed at.

The limited FAP population lacks effective treatment options, but patisiran might not be the first one available. Ionis Pharmaceuticals is shepherdingIONIS-TTRrx through a phase 3 study for FAP in partnership with the big British pharma,GlaxoSmithKline.

Alnylam's potential competitors expect top-line results from the IONIS-TTRRx phase 3 FAP trial in the first half of next year, with a potential phase 3 study in FAC planned if the candidate's safety profile holds up. Alnylam's resources are limited, which makes potential competition with Glaxo a daunting challenge. Many patients with FAP also exhibit FAC symptoms. If IONIS-TTRRx eventually earns green lights for both indications, commercializing patisiran would become even more difficult.

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Cory Renauer has no position in any stocks mentioned. You can follow Cory on Twitter @TMFang4apples or LinkedIn for more healthcare industry insight.

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