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Alnylam Reports Higher Q2 Revenues, Net Loss; Says AMD Program May Not Proceed

Alnylam Pharmaceuticals reported this week a jump in second-quarter revenues, but still posted higher losses for the period.

During a conference call to discuss the results, President and CEO John Maraganore also noted that the company is considering dropping its age-related macular degeneration program due to strong clinical data associated with other treatments for the disease.

According to the company, its revenues for the period were $1.1 million, up from $100,000 in the year-ago quarter. Driving the revenue rise were approximately $600,000 in cost reimbursements related to Alnylam's June 2004 collaboration and license agreement with Merck for the development of RNAi drugs for ocular diseases (see RNAi News, 7/2/2004).

Also contributing was the amortization of $1 million of maintenance payments received by Alnylam in 2004 from Merck under the companies' September 2003 strategic alliance for the development of in vivo RNAi technology and therapeutics (see RNAi News, 9/12/2003). Top-line growth was also bolstered by the amortization of $3 million of up-front payments earned by Alnylam from Merck under their ocular disease partnership.

Alnylam also said that its revenues were bolstered by $200,000 earned through its collaboration with Cystic Fibrosis Foundation Therapeutics (see RNAi News, 3/18/2005).

Alnylam's net loss for the second quarter rose to $11.1 million, or $0.54 per share, versus a loss of $7.7 million, or $1.10 per share, a year earlier. The increase included a $2.1 million non-cash charge resulting from the issuance of 270,000 shares of Alnylam's common stock in connection with the June 2005 amendment to the company's license agreements with Garching Innovation, the technology transfer arm of the Max Planck Society (see RNAi News, 6/17/2005). The loss also included more than $900,000 of non-cash, stock-based compensation expenses.

Alnylam's research and development spending in the quarter surged to $9.2 million from $4.2 million in the year-ago quarter, reflecting the $2.1 million charge associated with the company's amended arrangement with Garching, as well as higher external costs associated with its respiratory syncytial virus program.

General and administrative expenses were $3.1 million in the second quarter, up from $2.9 million last year.

As of June 30, Alnylam had $31.6 million in cash, cash equivalents, and marketable securities. The company said that it expects is cash and marketable securities balance to be greater than $25 million at the end of 2005, and that its existing cash position in combination with cash expected to be generated under current alliances will fund operations through the end of 2006.

During the conference call, Maraganore said that while the company is currently on track to filing an investigation new drug application and begin clinical testing of an RNAi-based treatment for AMD in the second half of 2005, the company is evaluating with Merck whether continued development of the drug makes sense.

"The [AMD] landscape has changed dramatically in the last month or so," he said. "In particular, we all need to take note of the recent Lucentis data presented at the American Society of Retina specialists."

At that meeting, data was presented showing that Lucentis, which is made by Genentech, improved the vision of AMD patients over one year in a phase III trial.

Maraganore also noted that data was presented at the ASR meeting showing that Genentech's cancer drug Avastin could be used off-label to treat AMD.

"We need to fully understanding the evolving landscape in MAD treatments to create the … greatest value for Alnylam and its stockholders," he said. "So, we remain on track for our 2005 goal, but at the same time we are working with our partner Merck and key opinion leaders in the field in an overall process to determine the right development and commercial path forward."

Maraganore said that while Alnylam is committed to its AMD program, "if we don't see a fruitful path forward, we will not waste our valuable resources to initiate clinical trials."


Qiagen to Pay Up to $17.6 Million for Protein-Prep Assets of LumiCyte, SuNyx

Qiagen said this week that it plans to acquire assets from LumiCyte and SuNyx, two firms providing protein sample-preparation technology for MALDI mass spectrometry.

Qiagen will pay up to $16 million for "key assets" from LumiCyte, including its Surface Tension Segmented biochips for MALDI mass spectrometry. Initially, Qiagen will pay $3 million in cash, followed by $4 million after 18 months and $5 million after 30 months, depending on whether financial targets are met. In addition, Qiagen may make a milestone payment of $4 million after 60 months.

SuNyx provides two sample-preparation platforms for liquid chromatrography MALDI mass spectrometry called MPep and MProtChip. Qiagen will pay up to $1.6 million in total for these assets, $800,000 initially and another $800,000 depending on certain milestones.

Qiagen said it will provide further details on the acquisitions in its second-quarter earnings conference call on Aug. 9.


Invitrogen Posts Strong Q2 Revenue Gains; Income Down on Charge

Invitrogen last week reported a 21-percent increase in second-quarter revenue year over year, but a 24 percent drop in net earnings due to a one-time charge.

The firm reported revenue of $306.5 million compared with $254 million in the second quarter last year. The company also beat analysts' consensus estimate of $301 million for the quarter.

Invitrogen's organic revenue growth was 7 percent, with 2 percent of growth coming from currency benefits and 12 percent attributed to acquisitions.

During the quarter, the company completed its acquisitions of Dynal Biotech and Caltag Laboratories, two of several purchases the company has made this year. Earlier this week, Invitrogen announced that it would acquire proteins and reagents firm BioSource International for $130 million in cash.

Revenue growth was strongest in Invitrogen's BioDiscovery segment, which had 30 percent sales growth year over year, while the BioProduction unit had revenue growth of 9 percent.

The firm's R&D spending increased to $24.3 million from $18.2 million in the comparable quarter last year.

Invitrogen's net earnings dropped to $14.9 million, or $.27 per share, from $19.7 million, or $.36 per share, in the second quarter last year. However, the firm noted that it took a one-time charge of $13 million in the most recent quarter related to costs associated with its purchase of Dynal.

The company is forecasting fiscal 2005 revenue of $1.2 billion and earnings per share of $3.50 to $3.53.

As of June 30, Invitrogen held $931.9 million in cash and investments


Nastech Posts Higher Revenues, Net Loss in Q2

Nastech Pharmaceutical reported this week a jump in second-quarter revenues but a rise in its net loss.

The company's revenues were $1.6 million for the quarter, versus $45,000 one year ago, reflecting a number of collaborations signed with pharmaceutical and biotechnology partners.

Nastech's net loss for the quarter was $8.3 million, or $0.47 per share, compared with a loss of $7.5 million, or $0.62 per share, in the same period a year earlier. According to the company, the changes in the losses were a result of a combination of higher operating revenue in the current year and increased income from a larger cash base, offset by higher spending and an increased headcount.

The company's research and development costs climbed to $7.2 million in the second quarter from $5.3 million a year ago. Meanwhile, Nastech's selling, general, and administrative costs jumped $800,000 in the quarter to $3.1 million.

As of June 30, Nastech had cash, cash equivalents, and investments totaling $52 million.

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