Alnylam Pharmaceuticals, Inc. (ALNY), a leading RNAi therapeutics company, announced today its key scientific, product, and business goals for 2009, including financial guidance.

“We are more excited than ever about the potential of RNAi therapeutics as a transformative approach for innovative medicines. 2008 was an extremely productive year for Alnylam, having met all of our corporate goals, and we expect this momentum to continue in 2009 across the key value drivers of our company: scientific leadership, pipeline advancement, intellectual property, and business execution,” said John Maraganore, Ph.D., Chief Executive Officer of Alnylam. “Our scientific leadership was evidenced last year with 14 peer-reviewed publications, and we expect 15 or more in 2009 that will continue to demonstrate our success in achieving delivery of RNAi therapeutics. With continued advancement of our RSV program, initiation of our Phase I study for the treatment of liver cancers, and an additional IND filing expected later this year, we plan to have three RNAi therapeutic programs in clinical development in 2009. In addition, our proven execution on the business development front remains unprecedented in the industry, having just last week completed our tenth major alliance since the company’s inception which together have yielded approximately $660 million in realized funding, and we look forward to expanding on these efforts this year with at least two additional major new alliances.”

“This past year was a particularly important one for Alnylam financially, and looking forward into 2009, our solid financial position continues to afford us the opportunity to invest in the advancement of our platform and pipeline of novel RNAi technologies and therapeutic products. We will also continue to invest wisely in additional opportunities in the broader area of RNA therapeutics, such as we did with Regulus Therapeutics,” said Patricia Allen, Vice President of Finance and Treasurer of Alnylam. “We are on track to comfortably meet our previously raised guidance of ending 2008 with a cash position of greater than $500 million, excluding the upfront payment received as part of our Cubist RSV partnership announced last week. In 2009, we expect a total non-GAAP cash net operating loss of approximately $35 to $45 million and also expect to incur approximately $20 to $30 million of other cash payments, including further investment in Regulus, cash tax payments, capital expenditures, and other potential strategic investments. We expect to finish 2009 with greater than $435 million in cash.”

2009 Pipeline and Scientific Goals

• Continue to Progress ALN-RSV01 in Phase II Studies. Alnylam continues to actively enroll patients in its Phase II randomized, double-blind, placebo-controlled study of ALN-RSV01 in RSV-infected adult lung transplant patients and expects to complete enrollment in mid-2009 with data thereafter. The company plans to initiate a pediatric Phase II trial upon completion of the current Phase II adult trial and discussions with regulatory authorities. Last week, Alnylam and Cubist announced a 50-50 strategic collaboration for the ALN-RSV program, which is also partnered in Asia with Kyowa Hakko.
• Advance ALN-VSP for the Treatment of Liver Cancers. In the first half of 2009, Alnylam plans to initiate patient dosing of its Phase I, multi-center, open label, dose escalation trial evaluating ALN-VSP in patients with liver cancers, including hepatocellular carcinoma and other solid tumors with liver involvement. An investigational new drug (IND) application for the ALN-VSP program was recently filed with the U.S. Food and Drug Administration (FDA).
• Expand Clinical Development Pipeline. Alnylam expects to file a new IND application from its development pipeline in 2009, with candidates including: ALN-PCS, an RNAi therapeutic targeting PCSK9 for the treatment of hypercholesterolemia; ALN-TTR, an RNAi therapeutic targeting transthyretin (TTR) for the treatment of TTR amyloidosis; and ALN-HTT, an RNAi therapeutic targeting the huntingtin gene for the treatment of Huntington’s disease.
• Continue Scientific Leadership in RNAi Therapeutics with 15 or More Peer-Reviewed Papers. Alnylam intends to continue its leading scientific efforts through the publication of key data related to RNAi therapeutics, as well as advancements in microRNA and RNA activation (RNAa) therapeutics, in high-quality, peer-reviewed scientific journals. These peer-reviewed papers will continue to highlight Alnylam’s progress in achieving delivery of small interfering RNAs, or siRNAs, the molecules that mediate RNAi, as well as the breadth of applications for RNAi therapeutics as a platform for innovative medicines.

2009 Business Goals

• Form At Least Two Additional Major New Alliances. In addition to Alnylam’s RSV partnership announced last week and based on ongoing discussions, the company expects to form at least two additional major new alliances in 2009 ranging from major platform alliances, such as the company’s partnerships with Takeda and Roche; product alliances, such as those the company has formed with Medtronic, Kyowa Hakko, and Cubist; alliances with Regulus Therapeutics, such as that formed with GSK; and the formation of new business ventures.
• Continue Intellectual Property (IP) Dominance with Greater than 15 New Patent Grants. In 2009, Alnylam expects to further strengthen its dominant IP position by receiving greater than 15 additional patent issuances or grants from patent offices around the world for fundamental, chemistry, delivery, target, microRNA therapeutics, and RNAa IP.
• Maintain Solid Financial Performance. Alnylam is on track to achieve a 2008 year-end cash position of greater than $500 million at December 31, 2008. In 2009, Alnylam aims to maintain its solid financial position while executing on its product and business goals and expects to end the year with greater than $435 million in cash. The company has also guided that it will end 2009 with a non-GAAP cash net operating loss of approximately $35 to $45 million.

“Last year, we announced our longer-range ‘RNAi 2010’ objectives highlighting key goals that we expect to achieve by the end of 2010. These included achievement of major breakthroughs in delivery, advancement of four or more RNAi therapeutic clinical programs, and completion of four or more new major business alliances. We’re extremely pleased that we are well on track to meet or exceed these objectives,” said Barry Greene, President and Chief Operating Officer of Alnylam. “These efforts, combined with our solid financial performance, dominant IP position, and commitment from our current and future industry partners, strongly position Alnylam to achieve its mission of building a top-tier biopharmaceutical company founded on RNAi.”

About RNAi 2010

In January 2008, Alnylam launched its ‘RNAi 2010’ plan as a new initiative focused on achieving major scientific, clinical, and business milestones by the end of 2010.

• Scientific Leadership. By the end of 2010, Alnylam expects to broaden its leadership and significantly expand the scope of delivery solutions for RNAi therapeutics. This will be achieved by the continued scientific leadership of Alnylam scientists and current academic and industry collaborators, but also a significant external effort to form new delivery technology partnerships. Further, this effort will include the significant expansion of the range of tissues and cell types where the company aims to achieve efficient delivery of RNAi therapeutics with both direct and systemic delivery approaches.
• Clinical Pipeline. By the end of 2010, Alnylam expects to have four or more RNAi therapeutic programs in clinical development. These include direct and systemic RNAi programs, Alnylam proprietary and 50-50 partnership programs, and siRNA and microRNA therapeutics.
• New Business Collaborations. Based on its scientific, clinical, and intellectual property leadership, the company also expects to form four or more new major business collaborations by the end of 2010. These are expected to include the completion of additional broad platform alliances similar to the company’s July 2007 partnership with Roche. Completion of these business collaborations is expected to provide the company significant resources and funding to advance Alnylam’s proprietary and 50-50 partnership pipeline programs.

About RNA Interference (RNAi)

RNAi (RNA interference) is a revolution in biology, representing a breakthrough in understanding how genes are turned on and off in cells, and a completely new approach to drug discovery and development. Its discovery has been heralded as “a major scientific breakthrough that happens once every decade or so,” and represents one of the most promising and rapidly advancing frontiers in biology and drug discovery today which was awarded the 2006 Nobel Prize for Physiology or Medicine. RNAi is a natural process of gene silencing that occurs in organisms ranging from plants to mammals. By harnessing the natural biological process of RNAi occurring in our cells, the creation of a major new class of medicines, known as RNAi therapeutics, is on the horizon. RNAi therapeutics target the cause of diseases by potently silencing specific messenger RNAs (mRNAs), thereby preventing disease-causing proteins from being made. RNAi therapeutics have the potential to treat disease and help patients in a fundamentally new way.

About Alnylam Pharmaceuticals

Alnylam is a biopharmaceutical company developing novel therapeutics based on RNA interference, or RNAi. The company is applying its therapeutic expertise in RNAi to address significant medical needs, many of which cannot effectively be addressed with small molecules or antibodies, the current major classes of drugs. Alnylam is leading the translation of RNAi as a new class of innovative medicines with peer-reviewed research efforts published in the world’s top scientific journals including Nature, Nature Medicine, and Cell. The company is leveraging these capabilities to build a broad pipeline of RNAi therapeutics; its most advanced program is in Phase II human clinical trials for the treatment of respiratory syncytial virus (RSV) infection and is partnered with Cubist and Kyowa Hakko. In addition, the company is developing RNAi therapeutics for the treatment of a wide range of disease areas, including liver cancers, hypercholesterolemia, Huntington’s disease, and TTR amyloidosis. The company’s leadership position in fundamental patents, technology, and know-how relating to RNAi has enabled it to form major alliances with leading companies including Medtronic, Novartis, Biogen Idec, Roche, Takeda, Kyowa Hakko, and Cubist. To reflect its outlook for key scientific, clinical, and business initiatives, Alnylam established “RNAi 2010” in January 2008 which includes the company’s plan to significantly expand the scope of delivery solutions for RNAi therapeutics, have four or more programs in clinical development, and to form four or more new major business collaborations, all by the end of 2010. Alnylam is a joint owner of Regulus Therapeutics, a joint venture focused on the discovery, development, and commercialization of microRNA therapeutics. Founded in 2002, Alnylam maintains headquarters in Cambridge, Massachusetts. For more information, please visit http://www.alnylam.com.

Alnylam Forward-Looking Statement

Various statements in this release concerning Alnylam’s future expectations, plans and prospects, including statements regarding the progress of development of Alnylam’s pre-clinical and clinical programs, such as when such programs may enter into, or advance in, human clinical trials, Alnylam’s expectations regarding entering into business alliances, Alnylam’s expectations regarding its financial goals, such as the amount of cash Alnylam expects to have at any given time, and Alnylam’s expectations with regard to obtaining and maintaining its intellectual property, constitute forward-looking statements for the purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995.