Will 2018 Be Alnylam Pharmaceuticals, Inc.'s Best Year Yet?

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Some achievements are hard to top. Alnylam Pharmaceuticals (NASDAQ: ALNY), for example, saw its stock price soar 249% in 2017. That's not an easy feat to pull off in one year, much less to do it again.

But will 2018 be Alnylam's best year yet? In terms of stock performance, I'm not too confident. However, on several other fronts, it appears highly likely that 2018 will be a year for Alnylam investors to remember. Here are three reasons why.

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1. Launch of patisiran

The biggest story of all for Alnylam in 2018 will be a launch of patisiran in hATTR amyloidosis. Of course, there is that minor detail of winning regulatory approval first. Alnylam completed its submission to the FDA in December. The company expects a decision in mid-2018. Alnylam also hopes to gain European approval for patisiran in late 2018.

Although there's always the possibility of a surprise, patisiran's chances for approval in the U.S. and Europe should be really good. Alnylam and partner Sanofi (NYSE: SNY) reported great results from a late-stage study, with patients receiving patisiran experiencing significant improvement in neuropathy symptoms. And while patisiran-treated patients were more likely to suffer from peripheral edema and infusion-related reactions, these adverse events were generally mild to moderate.

Assuming patisiran receives a thumbs-up from regulators, Alnylam has a good shot at a successful launch. There's a huge unmet need for patients with hATTR amyloidosis. It's a debilitating and often fatal rare genetic disease. The only approved treatments for early-stage disease are liver transplantation and Pfizer's Vyndaqel (tafamidis) in some countries outside the U.S.

Thanks to a restructuring of its alliance with Sanofi announced a few days ago, Alnylam will have global development and commercialization rights to its investigational RNAi therapeutics programs for treating ATTR amyloidosis, including patisiran and ALN-TTRsc02. That means Sanofi will receive royalties for any sales of patisiran assuming it launches as expected later this year, while Alnylam will get most of sales and profits from the drug.

2. Report of late-stage results for givosiran

There should be a flurry of activity this year for another of Alnylam's drugs. The biotech plans to report data from a phase 1/2 open-label extension study evaluating givosiran for treating acute hepatic porphyrias in early 2018. Those results aren't what investors are really eager to hear, though.

In mid-2018, Alnylam should announce top-line interim results from its Envision late-stage study of givosiran. If those results are positive, the company plans to file for accelerated regulatory approval in the U.S. by late 2018. The study would continue, with enrollment completing in the latter part of the year.

Good late-stage results for givosiran could enable Alnylam to move quickly from its current status as a clinical-stage biotech to a multi-product, global commercial-stage biopharmaceutical company. The FDA has granted breakthrough therapy designation to the drug, with the European Medicines Agency (EMA) granting a similar designation. Both designations mean givosiran should enjoy an expedited review process if all goes well in the clinical study.

3. Advancement of several other pipeline candidates

Alnylam also has a laundry list of things it intends to do in 2018 to advance its other pipeline candidates. At the top of that list is to initiate a late-stage study of ALN-TTRsc02 in treating ATTR amyloidosis.

As part of the alliance restructuring mentioned earlier, Sanofi will have global commercialization rights to fitusiran. Alnylam will support Sanofi's efforts as the big drugmaker continues to enroll patients throughout 2018 in a late-stage study evaluating the RNAi therapeutic in treating patients with hemophilia A or B.

Alnylam will also support another partner, The Medicines Company (NASDAQ: MDCO), as it moves forward this year with late-stage studies of inclisiran in treating hypercholesterolemia. The Medicines Company licensed the RNAi therapeutic from Alnylam. If inclisiran eventually reaches market, Alnylam will be eligible for milestones and royalties of up to 20% on sales of the drug.

In addition, Alnylam should have several data readouts from its earlier-stage clinical programs throughout 2018. The company also plans to move forward with its infectious-disease collaboration with Vir Biotechnology.

But what about Alnylam stock?

It seems pretty clear that Alnylam is about to have its best year yet in 2018 in several ways, with the likelihood of launching its first commercial product and the potential for several other key pipeline milestones. But will the stock have another winning performance in 2018?

First, the good news. There's little danger of a dilution-causing, share-price-battering stock offering this year. When Alnylam reported its third-quarter results in November, the company was sitting on over $1 billion, including cash, cash equivalents, fixed-income marketable securities, and restricted investments. That total was up to more than $1.7 billion at the end of 2017, thanks to a stock offering conducted in the fourth quarter. More good news is that potential approval of patisiran, launch of the drug, and clinical updates for other drugs provide several catalysts that could boost Alnylam stock even higher this year.

Now, the bad news. Because of its tremendous success in 2017, Alnylam's market cap now stands at $12.7 billion. The biotech doesn't have a product on the market yet, so high expectations are already baked into the stock price. Peak sales estimates for patisiran are all over the map. I've seen relatively recent projections of around $1 billion from one analyst to $2.9 billion from another analyst. If the more pessimistic view is right, Alnylam stock doesn't have nearly as much room to run compared with the optimistic estimate.

My view is that Alnylam should enjoy more gains in 2018. However, I don't expect anything close to what the stock generated last year. If you're looking for the possibility of a huge winner over the next 11 and a half months, it might be better to look elsewhere. I think that, for Alnylam, the train has already left the station.

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Keith Speights owns shares of Pfizer. The Motley Fool owns shares of and recommends Alnylam Pharmaceuticals. The Motley Fool has a disclosure policy.