What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-05-04 compared with 2022-10-27 · 112 added, 132 removed, 174 unchanged (58% of the section changed)

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We believe this is a revolutionary approach with the potential to transform the care of patients with rare and prevalent diseases.

To date, our efforts to advance this revolutionary approach have yielded the approval of five first-in-class RNAi-based medicines, ONPATTRO ® (patisiran), GIVLAARI ® (givosiran), OXLUMO ® (lumasiran), AMVUTTRA ® (vutrisiran) and Leqvio ® (inclisiran).

To date, our efforts to advance this revolutionary approach have yielded the approval of five first-in-class RNAi-based medicines, ONPATTRO ® (patisiran), AMVUTTRA ® (vutrisiran), GIVLAARI ® (givosiran), OXLUMO ® (lumasiran) and Leqvio ® (inclisiran).

Our research and development strategy is to target genetically validated genes that have been implicated in the cause or pathway of human disease.

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For delivery to the central nervous system, or CNS, and the eye (ocular delivery), we are utilizing an alternative conjugate approach based on a hexadecyl (C16) moiety as a lipophilic ligand.

We are also advancing approaches for lung, muscle and adipose tissue delivery of siRNAs.

We are also advancing approaches for heart, skeletal muscle and adipose tissue delivery of siRNAs.

Our focus is on clinical indications where there is a high unmet need, a genetically validated target, early biomarkers for the assessment of clinical activity in Phase 1 clinical studies, and a definable path for drug development, regulatory approval, patient access and commercialization.

In early 2021, we launched our Alnylam P 5 x25 strategy, which focuses on our planned transition to a top five biotech company, as measured by market capitalization, by the end of 2025.

In early 2021, we launched our Alnylam P 5 x25 strategy, which focuses on our planned transition to a top-tier biotech company, as measured by market capitalization, by the end of 2025.

With Alnylam P 5 x25 , we aim to deliver transformative rare and prevalent disease medicines for patients around the world through sustainable innovation, while delivering exceptional financial performance.

We currently have five marketed products and over a dozen clinical programs, including multiple programs in late-stage development, across four Strategic Therapeutic Areas, or “STArs:” Genetic Medicines;

We currently have five marketed products and more than ten clinical programs, including several in late-stage development, across four Strategic Therapeutic Areas, or “STArs:” Genetic Medicines;

Cardio-Metabolic Diseases;

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and CNS/Ocular Diseases.

Four of our marketed products are within the Genetic Medicines STAr, ONPATTRO, GIVLAARI, OXLUMO and AMVUTTRA.

Four of our marketed products are within the Genetic Medicines STAr, ONPATTRO, AMVUTTRA, GIVLAARI and OXLUMO.

ONPATTRO is approved by the United States Food and Drug Administration, or the FDA, for the treatment of the polyneuropathy of hereditary transthyretin-mediated amyloidosis, or hATTR amyloidosis, in adults and has also been approved in the European Union, or EU, for the treatment of hATTR amyloidosis in adult patients with stage 1 or stage 2 polyneuropathy, in Japan for the treatment of transthyretin, or TTR, type familial amyloidosis with polyneuropathy, and in multiple additional countries, including Brazil.

In August 2022, we reported positive results from the APOLLO-B Phase 3 study of patisiran (the non-branded name of ONPATTRO) in patients with ATTR amyloidosis with cardiomyopathy and announced that we plan to submit a supplemental New Drug Application, or sNDA, for ONPATTRO as a potential treatment for ATTR amyloidosis with cardiomyopathy for review by the FDA in late 2022.

In August 2022, we reported positive results from the APOLLO-B Phase 3 study of patisiran (the non-branded name of ONPATTRO) in patients with transthyretin amyloidosis, or ATTR amyloidosis, with cardiomyopathy, and in December 2022, we submitted a supplemental New Drug Application, or sNDA, to the FDA for ONPATTRO as a potential treatment of the cardiomyopathy of ATTR amyloidosis.

In February 2023, the FDA accepted the sNDA for filing and set an action date of October 8, 2023 under the Prescription Drug User Fee Act, or PDUFA.

The FDA also indicated in the sNDA filing communication letter that it is planning to hold an advisory committee meeting to discuss the application and that it had not identified any potential review issues at such time.

In March, 2023, we submitted an sNDA to the Brazilian Health Regulatory Agency (ANVISA) for ONPATTRO for the treatment of the cardiomyopathy of ATTR amyloidosis.

AMVUTTRA is approved in the U.S.

for the treatment of the polyneuropathy of hATTR amyloidosis in adults.

In September 2022, AMVUTTRA was granted marketing authorization in Europe and the United Kingdom, or UK, for the treatment of hATTR amyloidosis in adult patients with stage 1 or stage 2 polyneuropathy, and in Japan for the treatment of TTR type familial amyloidosis with polyneuropathy.

In December 2022, AMVUTTRA was approved in Brazil for the treatment of hATTR amyloidosis in adults.

Regulatory filings in other territories are currently under review and additional filings are pending or planned during 2023 and beyond.

GIVLAARI is approved in the U.S.

for the treatment of adults with acute hepatic porphyria, or AHP, in the EU for the treatment of AHP in adults and adolescents aged 12 years and older, and in several additional countries, including Brazil, Canada, Switzerland and Japan.

Regulatory filings for givosiran (the non-branded drug name for GIVLAARI) are pending or planned during the remainder of 2022 and beyond.

In November 2020, we received regulatory approval for OXLUMO in the U.S.

and EU for the treatment of primary hyperoxaluria type 1, or PH1, in all age groups.

In June 2021, we received marketing authorization approval for OXLUMO in Brazil for the treatment of PH1 in both children and adult patients.

Regulatory filings for givosiran (the non-branded drug name for GIVLAARI) in other territories are pending or planned during 2023 and beyond.

OXLUMO is approved in the U.S.

and EU for the treatment of primary hyperoxaluria type 1, or PH1, in all age groups, and in several additional countries including Brazil and Switzerland.

In October 2022, we announced that the FDA approved our sNDA for lumasiran (the non-branded drug name for OXLUMO), for the treatment of PH1 to lower urinary oxalate and plasma oxalate levels in pediatric and adult patients.

Regulatory filings in other territories are pending and additional filings are planned during the remainder of 2022 and beyond.

In June 2022, we received regulatory approval for AMVUTTRA in the U.S.

for the treatment of the polyneuropathy of hATTR amyloidosis in adults.

In September 2022, the European Commission, or EC, granted marketing authorization for AMVUTTRA for the treatment of hATTR amyloidosis in adult patients with stage 1 or stage 2 polyneuropathy.

We have also filed for regulatory approval for vutrisiran (the non-branded name of AMVUTTRA) with the Brazilian Health Regulatory Agency and the Japanese Pharmaceuticals and Medical Devices Agency, or the PMDA.

Additional regulatory filings are planned during the remainder of 2022 and beyond.

Regulatory filings in other territories are pending and additional filings are planned during 2023 and beyond.

Our fifth product, Leqvio (inclisiran), is in the Cardio-Metabolic Diseases STAr.

Leqvio is being developed and commercialized by our partner Novartis AG, or Novartis, and has received marketing authorization from the EC for the treatment of adults with hypercholesterolemia or mixed dyslipidemia and from the FDA as an adjunct to diet and maximally tolerated statin therapy for the treatment of adults with heterozygous familial hypercholesterolemia, or HeFH, or clinical atherosclerotic cardiovascular disease, or ASCVD, who require additional lowering of LDL-C.

As of the end of September 2022, Leqvio has been approved in more than 60 countries.

Leqvio is being developed and commercialized by our partner Novartis AG, or Novartis, and has received marketing authorization from the European

Commission, or EC, for the treatment of adults with hypercholesterolemia or mixed dyslipidemia and from the FDA as an adjunct to diet and maximally tolerated statin therapy for the treatment of adults with heterozygous familial hypercholesterolemia, or HeFH, or clinical atherosclerotic cardiovascular disease, or ASCVD, who require additional lowering of LDL-C.

As of the end of March 2023, Leqvio has been approved in more than 75 countries.

In addition to our marketed products, we have multiple late-stage investigational programs advancing toward potential commercialization.

These programs include our wholly owned programs:

lumasiran for the treatment of recurrent renal stones;

patisiran for the treatment of transthyretin amyloidosis, or ATTR amyloidosis, with cardiomyopathy;

vutrisiran for the

treatment of ATTR amyloidosis with cardiomyopathy;

patisiran (the non-branded drug name for ONPATTRO) for the treatment of ATTR amyloidosis, (wild-type or hereditary) with cardiomyopathy;

vutrisiran (the non-branded drug name for AMVUTTRA) for the treatment of ATTR (wild-type or hereditary) amyloidosis with cardiomyopathy;

as well as fitusiran for the treatment of hemophilia, which is being advanced by our partner Genzyme Corporation, a Sanofi Company, or Sanofi;

and cemdisiran for the treatment of complement-mediated diseases, which we are advancing as a monotherapy in a Phase 2 study, and our partner Regeneron Pharmaceuticals, Inc., or Regeneron, is advancing cemdisiran in combination with pozelimab in Phase 3 studies in myasthenia gravis and paroxysmal nocturnal hemoglobinuria.

As part of our Alnylam P 5 x25 strategy, we are focused on developing transformative prevalent disease medicines.

and cemdisiran for the treatment of complement-mediated diseases, where our partner Regeneron Pharmaceuticals, Inc., or Regeneron, is advancing cemdisiran in combination with pozelimab in Phase 3 studies in myasthenia gravis and paroxysmal nocturnal hemoglobinuria.

As part of our Alnylam P 5 x25 strategy, we have multiple drivers of future growth, including the development of transformative prevalent disease medicines.

In addition to Leqvio, we are advancing zilebesiran, an investigational, subcutaneously administered RNAi therapeutic targeting angiotensinogen, or AGT, in development for the treatment of hypertension.

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KARDIA-1 is designed to evaluate zilebesiran as a monotherapy across different doses administered quarterly and biannually.

KARDIA-2 will evaluate the safety and efficacy of zilebesiran administered biannually as a concomitant therapy in patients whose blood pressure is not adequately controlled by standard of care antihypertensive medications.

In further support of our Alnylam P 5 x25 strategy and in view of our evolving risk profile, we remain focused on continued evolution of our global infrastructure, including key objectives such as optimizing our global structure for execution in key markets, enhancing performance consistent with our values, and continuing to strengthen our culture.

Topline results from the KARDIA-1 and KARDIA-2 Phase 2 studies are anticipated in mid-2023 and at or around year-end 2023, respectively.

We are also advancing ALN-APP, an investigational RNAi therapeutic targeting amyloid precursor protein in development for the treatment of Alzheimer’s disease and cerebral amyloid angiopathy.

In April 2023, we reported positive interim results from the ongoing single ascending dose part of the Phase 1 study of ALN-APP in patients with early-onset Alzheimer’s disease.

These results establish the first human translation of our proprietary C16-siRNA conjugate platform for CNS delivery and are the first clinical demonstration of gene silencing in the human brain using an RNAi therapeutic.

In further support of our Alnylam P 5 x25 strategy and in view of our evolving risk profile, we remain focused on the continued evolution of our global infrastructure, including key objectives such as optimizing our global structure for execution in key markets, enhancing performance consistent with our values, and continuing to strengthen our culture.

We maintain focus on our global compliance program to drive its evolution and enhancement in view of the Alnylam P 5 x25 strategy .

Building from our global Code of Business Conduct and Ethics, our compliance program is designed to empower our employees and those with whom we work to execute on our strategy consistent with our values and in compliance with applicable laws.

Comprised of components such as risk assessment and monitoring;

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and systems and processes supporting activities such as third party relationships and investigations and remediation;

our program and related controls are built to enhance our business processes, structures, and controls across our global operations.

our program and related controls are built to enhance our business processes, structures, and controls across our global operations, and to empower ethical decision making.

Based on our expertise in RNAi therapeutics and broad intellectual property estate, we have formed alliances with leading pharmaceutical and life sciences companies to support our development and commercialization efforts, including Regeneron, Novartis (which acquired our partner The Medicines Company, or MDCO, in 2020), Sanofi, Vir Biotechnology, Inc., or Vir, Dicerna Pharmaceuticals, Inc.

(acquired by Novo Nordisk A/S, or Novo Nordisk, in December 2021), or Dicerna, and PeptiDream, Inc., or PeptiDream.

We have incurred significant losses since we commenced operations in 2002 and as of September 30, 2022, we had an accumulated deficit of $6.36 billion.

We have incurred significant losses since we commenced operations in 2002 and as of March 31, 2023, we had an accumulated deficit of $6.74 billion.

Historically, we have generated losses principally from costs associated with research and development activities, acquiring, filing and expanding intellectual property rights, and selling, general and administrative costs.

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Therefore, period-to-period comparisons should not be relied upon as predictive of the results in future periods.

We currently have programs focused on a number of therapeutic areas and, as of September 30, 2022, we generate worldwide product revenues from four commercialized products, ONPATTRO, GIVLAARI, OXLUMO and AMVUTTRA, primarily in the U.S., Europe and Japan.

We currently have programs focused on a number of therapeutic areas and, as of March 31, 2023, we generate worldwide product revenues from four commercialized products, ONPATTRO, AMVUTTRA, GIVLAARI and OXLUMO, primarily in the U.S., Europe and Japan.

However, our ongoing development efforts may not be successful and we may not be able to commence sales of any other products and/or successfully market and sell our approved products or any other products approved in the future.

A portion of our total revenues in recent years has been derived from collaboration revenues from strategic alliances with Regeneron, Vir and Novartis.

In addition to revenues from the commercial sales of our approved products and potentially from sales of future products, we expect our sources of potential funding for the next several years to continue to be derived in part from existing and new strategic alliances.

In addition to revenues from the commercial sales of our approved products and potentially from sales of future products, we expect our sources of potential funding for the next several years to

continue to be derived in part from existing and new strategic alliances.

Such alliances include, or may include in the future, license and other fees, funded research and development, milestone payments and royalties on product sales by our licensors, including royalties on sales of Leqvio made by our partner Novartis, as well as proceeds from the sale of equity or debt.

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The Notes will mature on September 15, 2027, unless earlier converted, redeemed or repurchased.

The Notes will bear interest from September 15, 2022 at a rate of 1.00% per year payable semiannually in arrears on March 15 and September 15 of each year, beginning on March 15, 2023.

Before June 15, 2027, noteholders will have the right to convert their Notes in certain circumstances and during specified periods.

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If, however, the market price per share of our common stock, as measured under the terms of the capped call transactions, exceeds the cap price of the capped call transactions, there would nevertheless be dilution upon conversion of the Notes to the extent that such market price exceeds the cap price of the capped call transactions.

We used approximately $762.0 million of the net proceeds from the offering to repay borrowings, inclusive of prepayment premiums, under our credit agreement with Blackstone, and intend to use the remainder of the net proceeds for general corporate purposes.

The COVID-19 Pandemic

The ongoing COVID-19 pandemic is evolving, and to date has led to the implementation of various responses, including government-imposed quarantines, travel restrictions, and other public health safety measures.

We have and will continue to closely monitor the spread of COVID-19 and its variants, and plan to continue taking steps to identify and mitigate the adverse impacts on, and risks to, our business posed by its spread and actions taken by governmental and health authorities to address the ongoing COVID-19 pandemic.

We expect to continue to take actions as may be required or recommended by government authorities or as we determine are in the best interests of our employees, the patients we serve and other business partners in light of COVID-19 and variants thereof.

The extent to which COVID-19 ultimately impacts our business, results of operations or financial condition will depend on future developments, which, despite progress in vaccination efforts, remain highly uncertain and cannot be predicted with confidence, such as the duration of the COVID-19 pandemic, new strains of the virus, including any future variants that may emerge, which may impact rates of infection and vaccination efforts, developments or perceptions regarding the safety of vaccines, new information that may emerge concerning the severity of COVID-19, and any additional preventative and protective actions taken to contain the pandemic or treat its impact, among others.

The estimates of the impact on the Company’s business may change based on new information that may emerge concerning COVID-19 and the actions to contain it or treat its impact and the economic impact on local, regional, national and international markets.

For additional information related to the actual or potential impacts of COVID-19 on our business, please read Part II, Item 1A, “Risk Factors” of this Quarterly Report on Form 10-Q.

We used approximately $762.0 million of the net proceeds from the offering of the Notes to repay borrowings, inclusive of prepayment premiums, under our credit agreement with Blackstone, and we intend to use the remainder of the net proceeds for general corporate purposes.

Research and Development

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and CNS/Ocular Diseases.

The chart below is a summary of our commercial products and late- and early-stage development programs as of October 2022.

The chart below is a summary of our commercial products and late- and early-stage development programs as of April 2023.

It identifies those programs for which we have received marketing approval, the stage of our programs and our commercial rights to such programs:

During the third quarter of 2022 and recent period, we reported the following updates from our commercially approved products and our late-stage clinical programs:

TTR Franchise:

During the first quarter of 2023 and recent period, we reported the following updates from our commercially approved products and our late-stage clinical programs:

ONPATTRO & AMVUTTRA

• We achieved global net product revenues for ONPATTRO and AMVUTTRA for the third quarter of 2022 of $145.0 million and $25.2 million, respectively.

• We achieved GIVLAARI global net product revenues for the third quarter of 2022 of $45.7 million.

• We achieved OXLUMO global net product revenues for the third quarter of 2022 of $16.4 million.

• We achieved global net product revenues for ONPATTRO and AMVUTTRA for the first quarter of 2023 of $102.5 million and $101.8 million, respectively.

Total Ultra-Rare:

GIVLAARI & OXLUMO

• We achieved global net product revenues for GIVLAARI and OXLUMO for the first quarter of 2023 of $47.9 million and $24.2 million, respectively.

• Our partner, Novartis, continued the launch of Leqvio in the U.S.

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• We continued to advance patisiran, in development for the treatment of ATTR amyloidosis:

◦ Reported positive results from the APOLLO-B Phase 3 study in patients with ATTR amyloidosis with cardiomyopathy, and announced that we remain on track to submit an sNDA for review by the FDA by year-end.

• We continued to advance vutrisiran, in development for the treatment of ATTR amyloidosis:

◦ Received marketing authorization for AMVUTTRA for the treatment of hATTR amyloidosis in adults with stage 1 or stage 2 polyneuropathy in Europe and the UK, as well as approval for TTR type familial amyloidosis with polyneuropathy in Japan;

◦ Announced that we do not plan to conduct the optional interim analysis for the HELIOS-B Phase 3 study in patients with ATTR amyloidosis with cardiomyopathy, and that the study remains on track for topline results in early 2024.

• We continued to advance lumasiran for the treatment of PH1 and in development for the treatment of recurrent kidney stone disease:

◦ Based on the successful outcome of the ILLUMINATE-C study in children and adults with advanced PH1, received approval from the FDA of an sNDA for OXLUMO, expanding the indication for the treatment of PH1 to lower urinary oxalate and plasma oxalate levels in pediatric and adult patients, and received approval from the EMA of a Type II variation to include the ILLUMINATE-C data in the label.

• We continued to advance cemdisiran for the treatment of complement-mediated diseases, in collaboration with our partner, Regeneron:

◦ Reported positive results from the Phase 2 study in patients with immunoglobulin A nephropathy, or IgAN;

◦ Announced that we are working with Regeneron to finalize plans for the Phase 3 clinical development of cemdisiran in IgAN.

◦ Submitted 18-month data from the APOLLO-B Phase 3 study to the U.S.

FDA as part of the sNDA review for ONPATTRO (patisiran) for the treatment of the cardiomyopathy of ATTR amyloidosis.

• Our partner, Sanofi, announced results from ATLAS-INH and ATLAS-A/B Phase 3 studies of fitusiran were published in The Lancet and The Lancet Haematology.

• Our partner, Regeneron, announced that it has initiated a Phase 2 study of ALN-HSD in patients with NASH.

There is a risk that any drug discovery or development program may not produce revenue for a variety of reasons, including the possibility that we will not be able to adequately demonstrate the safety and effectiveness of the product candidate or obtain approval or the desired labeling for the product candidate from regulatory authorities.

Moreover, there are uncertainties specific to any new field of drug discovery, including RNAi.

The success of ONPATTRO, GIVLAARI, OXLUMO, AMVUTTRA or any other product candidate we develop is highly uncertain.

Due to the numerous risks associated with developing drugs, including those risks associated with the ongoing COVID-19 pandemic, we cannot reasonably estimate or know the nature, timing and estimated costs of the efforts necessary to complete the development of any potential product candidate or indication, or the period, if any, in which material net cash inflows will commence from any approved product or indication.

Moreover, there are

uncertainties specific to any new field of drug discovery, including RNAi.

The success of ONPATTRO, AMVUTTRA, GIVLAARI, OXLUMO or any other product candidate we develop is highly uncertain.

Due to the numerous risks associated with developing drugs, we cannot reasonably estimate or know the nature, timing and estimated costs of the efforts necessary to complete the development of any potential product candidate or indication, or the period, if any, in which material net cash inflows will commence from any approved product or indication.

Any failure to complete any stage of the development of any potential products or any approved product for an expanded indication in a timely manner or successfully launch, market and sell any of our commercially approved products, could have a material adverse effect on our operations, financial position and liquidity.

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We are also advancing multiple other programs with Regeneron.

With respect to our Cardio-Metabolic pipeline, in March 2013, we entered into an exclusive, worldwide license with MDCO (acquired by Novartis AG in January 2020) pursuant to which MDCO was granted the right to develop, manufacture and commercialize RNAi therapeutics targeting proprotein convertase subtilisin/kexin type 9 for the treatment of

hypercholesterolemia and other human diseases, including inclisiran.

In March 2018, we entered into a discovery collaboration with Regeneron to identify RNAi therapeutics for nonalcoholic steatohepatitis, or NASH, and potentially other related diseases, and in November 2018, we and Regeneron entered into a separate, fifty-fifty collaboration to further research, co-develop and commercialize any therapeutic product candidates that emerge from these discovery efforts.

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We also have entered into license agreements to obtain rights to intellectual property in the field of RNAi.

In addition, because delivery of RNAi therapeutics has historically been an important objective of our research activities, we have entered into various collaboration and licensing arrangements with other companies and academic institutions to gain access to delivery technologies, including various LNP delivery technologies, and we may enter into such agreements in the future to gain access to products or technologies.

In addition, because delivery of RNAi therapeutics has historically been an important objective of our research activities, we have entered

into various collaboration and licensing arrangements with other companies and academic institutions to gain access to delivery technologies, including various LNP delivery technologies, and we may enter into such agreements in the future to gain access to products or technologies.

For example, in 2021, we entered into a license and collaboration agreement with PeptiDream to discover and develop peptide-siRNA conjugates leveraging PeptiDream's proprietary Peptide Discovery Platform System technology.

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The following data summarizes the results of our operations:

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands, except percentages) 2022 2021 $ Change % Change 2022 2021 $ Change % Change

Three Months Ended March 31,

(In thousands, except percentages) 2023 2022 $ Change % Change

Total revenues $ 319,290 $ 213,259 $ 106,031 50 %

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Loss from operations $ (149,807) $ (146,732) $ (3,075) 2 %

Total other expense, net $ (147,903) $ (22,559) $ (125,344) 556 % $ (323,514) $ (77,751) $ (245,763) 316 %

Net loss $ (174,101) $ (240,341) $ 66,240 (28) %

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Total revenues consist of the following:

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands, except percentages) 2022 2021 $ Change % Change 2022 2021 $ Change % Change

Three Months Ended March 31,

(In thousands, except percentages) 2023 2022 $ Change % Change

Net product revenues $ 276,328 $ 186,872 $ 89,456 48 %

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Net product revenues consist of the following, by product and region:

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands, except percentages) 2022 2021 $ Change % Change 2022 2021 $ Change % Change

Three Months Ended March 31,

(In thousands, except percentages) 2023 2022 $ Change % Change

United States $ 29,817 $ 62,307 $ (32,490) (52) %

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Total 102,493 137,009 (34,516) (25) %

United States 25,060 — 25,060 N/A 25,060 — 25,060 N/A

Europe 169 — 169 N/A 169 — 169 N/A

Total 25,229 — 25,229 N/A 25,229 — 25,229 N/A

United States 79,013 — 79,013 N/A

Europe 6,768 — 6,768 N/A

Rest of World 15,987 — 15,987 N/A

Total 101,768 — 101,768 N/A

United States 30,291 23,675 6,616 28 %

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Europe 13,309 8,158 5,151 63 %

Rest of World 698 — 698 N/A 1,937 — 1,937 N/A

Rest of World 1,795 1,016 779 77 %

Total 24,161 14,586 9,575 66 %

Total net product revenues $ 276,328 $ 186,872 $ 89,456 48 %

Net product revenues increased during the three and nine months ended September 30, 2022, compared to the same periods in 2021, as a result of increased patients on ONPATTRO, AMVUTTRA, GIVLAARI, and OXLUMO therapies, offset by an unfavorable impact from foreign exchange rates on our international revenues.

Net product revenues increased during the three months ended March 31, 2023, compared to the same period in 2022, primarily due to the U.S.

launch of AMVUTTRA in the third quarter of 2022, partially offset by a decrease of demand for ONPATTRO due to patient switches to AMVUTTRA.

Additional growth was provided by an increase in patients on GIVLAARI and OXLUMO therapies.

We expect net product revenues to increase during 2023, as compared to 2022, as we continue to add new patients onto our commercial products, as well as launch these products into additional markets, assuming regulatory approvals.

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Net revenues from collaborations consist of the following:

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands, except percentages) 2022 2021 $ Change % Change 2022 2021 $ Change % Change

Three Months Ended March 31,

(In thousands, except percentages) 2023 2022 $ Change % Change

Regeneron Pharmaceuticals $ 19,990 $ 12,412 $ 7,578 61 %

Novartis AG 14,933 13,136 1,797 14 %

Vir Biotechnology 441 1,233 (792) (64) % 1,137 8,033 (6,896) (86) %

Other 1,539 397 1,142 288 %

Total $ 36,462 $ 25,945 $ 10,517 41 %

Net revenues from collaborations increased during the three months ended September 30, 2022, as compared to the same period in 2021, primarily due to an increase in revenue recognized in connection with our collaboration agreement with Regeneron, attributed to an increase in reimbursable activities under our research services arrangement in addition to an increase in revenue recognized associated with our clinical trial activities.

Net revenues from collaborations decreased during the nine months ended September 30, 2022, as compared to the same periods in 2021, primarily due to a decrease in revenue recognized in connection with our collaboration agreement with Regeneron, attributed to reduced research and manufacturing activities and timing of reimbursable activities.

We earn royalty revenue from global net sales of Leqvio by our partner, Novartis.

In December 2020, Leqvio received marketing authorization from the EC for the treatment of adults with hypercholesterolemia or mixed dyslipidemia, and in December 2021, Leqvio was approved by the FDA for the treatment of adults with HeFH or ASCVD.

During the quarter ended September 30, 2022, we recorded $2.7 million in royalty revenue.

Net revenues from collaborations increased during the three months ended March 31, 2023, as compared to the same period in 2022, primarily due to an increase in revenue recognized in connection with our collaboration agreement with Regeneron, attributed to an increase in reimbursable activities under our research services arrangement in addition to an increase in revenue recognized associated with our licensed programs within the collaboration.

Royalty revenue increased during the three months ended March 31, 2023, as compared to the same period in 2022, due to increased royalties received from global net sales of Leqvio by our partner, Novartis.

Recognition of our combined net revenues from collaborations and royalty revenue is dependent on a variety of factors including the level of work reimbursed by partners, achievement of milestones under our collaboration agreements, and royalties associated with sales of Leqvio.

We expect net revenues from collaboration and royalty revenue to decrease in 2022, as compared to 2021, primarily due to the timing of reimbursable activities in our collaboration with Regeneron.

We expect variability in net revenues from collaboration and royalty revenue in 2023, as compared to 2022, due to the timing of manufacturing activities, achievement of milestones under our collaboration agreements, and royalties associated with sales of Leqvio.

Operating Costs and Expenses

Operating costs and expenses consist of the following:

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands, except percentages) 2022 2021 $ Change % Change 2022 2021 $ Change % Change

Three Months Ended March 31,

(In thousands, except percentages) 2023 2022 $ Change % Change

Cost of goods sold $ 41,432 $ 23,457 $ 17,975 77 %

Cost of goods sold as a percentage of net product revenues 15.0 % 12.6 %

Cost of collaborations and royalties 13,437 12,170 1,267 10 %

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Cost of goods sold

Cost of goods sold as a percentage of net product revenues decreased to 15.7% and 14.9% for the three and nine months ended September 30, 2022, respectively, as compared to 16.8% and 17.6% for the three and nine months ended September 30, 2021, respectively, primarily due to fully amortized intangible assets and reduced royalties as a result of the expiry of third-party intellectual property.

We anticipate variability in our cost of goods sold as a percentage of net product revenues due to the timing of manufacturing runs and utilization and the depletion of zero-cost inventories, as well as launch our approved products into additional markets, assuming regulatory approvals.

We expect cost of goods sold will increase during 2022, as compared to 2021, primarily as a result of an expected increase in net product sales as well as the sale of capitalized inventory.

Cost of goods sold as a percentage of net product revenues increased during the three months ended March 31, 2023, as compared to the same period in 2022, primarily due to increased royalties due to third-parties driven by the increase in sales of AMVUTTRA partially offset by lower manufacturing costs for AMVUTTRA compared with ONPATTRO.

We expect cost of goods sold and cost of goods sold as a percentage of net product revenues will increase during 2023, as compared to 2022, primarily as a result of an expected increase in total net product sales as well as increased AMVUTTRA royalties.

Cost of collaborations and royalties

Cost of collaborations and royalties increased during the three and nine months ended September 30, 2022, as compared to the same periods in 2021, primarily due to timing and demand of GalNAc material supply to our collaboration partners to support certain product manufacturing and ongoing clinical trials.

We expect cost of collaborations and royalties to remain relatively consistent during 2022, as compared to 2021, due to consistency in planned GalNAc material to be supplied to our collaboration partners.

Cost of collaborations and royalties increased during the three months ended March 31, 2023, as compared to the same period in 2022, primarily due to timing and demand of GalNAc material supply to our collaboration partners to support certain product manufacturing and ongoing clinical trials.

We anticipate variability in the cost of collaborations and royalties during 2023, as compared to 2022, due to the timing and demand of GalNAc material to be supplied to our collaboration partners.

Research and development

Research and development expenses consist of the following:

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands, except percentages) 2022 2021 $ Change % Change 2022 2021 $ Change % Change

Three Months Ended March 31,

(In thousands, except percentages) 2023 2022 $ Change % Change

Clinical research and outside services $ 111,597 $ 76,880 $ 34,717 45 %

Compensation and related 64,720 51,300 13,420 26 %

Stock-based compensation 52,962 12,417 40,545 327 % 75,217 49,878 25,339 51 %

Occupancy and all other costs 38,020 30,096 7,924 26 %

Stock-based compensation 16,232 11,617 4,615 40 %

Total $ 230,569 $ 169,893 $ 60,676 36 %

For the three and nine months ended September 30, 2022, the increases in research and development expenses, as compared to the same periods in the prior year, were primarily due to the following:

• Increased stock-based compensation expense primarily due to the accounting for certain performance-based awards;

• Increased compensation and related expenses as a result of increased headcount to support our R&D pipeline and development expenses associated with the KARDIA-1 and KARDIA-2 zilebesiran phase 2 studies.

• Decreased clinical research and outside services due to a decrease in clinical batches manufactured.

During the three and nine months ended September 30, 2022 and 2021, in connection with advancing activities under our collaboration agreements, we incurred research and development expenses, primarily related to external development and clinical expenses, including the manufacture of clinical product.

For the three months ended March 31, 2023, the increase in research and development expenses, as compared to the same period in 2022, was primarily due to the following:

• Increased clinical research and outside services associated with the APOLLO-B (patisiran), HELIOS-B (vutrisiran), and KARDIA-1/KARDIA-2 (zilebesiran) clinical studies, and manufacturing related expenses associated with our pre-clinical activities;

• Increased compensation and related expenses as a result of increased headcount to support our R&D pipeline and development expenses.

During the three months ended March 31, 2023 and 2022, in connection with advancing activities under our collaboration agreements, we incurred research and development expenses, primarily related to external development and clinical expenses, including the manufacture of clinical product.

The following table summarizes research and development expenses incurred, for which we recognize net revenue, that are directly attributable to our collaboration agreements, by collaboration partner:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(In thousands) 2023 2022

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Selling, general and administrative expenses consist of the following:

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands, except percentages) 2022 2021 $ Change % Change 2022 2021 $ Change % Change

Three Months Ended March 31,

(In thousands, except percentages) 2023 2022 $ Change % Change

Compensation and related $ 74,326 $ 60,283 $ 14,043 23 %

Consulting and professional services 50,688 44,461 6,227 14 %

Stock-based compensation 75,156 20,950 54,206 259 % 112,665 71,257 41,408 58 %

Occupancy and all other costs 34,930 32,051 2,879 9 %

Stock-based compensation 23,715 17,676 6,039 34 %

Total $ 183,659 $ 154,471 $ 29,188 19 %

For the three and nine months ended September 30, 2022, the increases in selling, general and administrative expenses, as compared to the same periods in the prior year, were primarily due to the following:

• Increased stock-based compensation expense primarily due to the accounting for certain performance-based awards;

• Increased compensation and related expenses as a result of increased headcount;

• Increased consulting and professional services expenses to support our commercial portfolio.

We expect that research and development expenses combined with selling, general and administrative expenses will increase during 2022, as compared to 2021, as we continue to advance and develop our platform and pipeline, advance our product candidates, including partnered programs, into later-stage development, prepare regulatory submissions and continue to build-out our global commercial and compliance infrastructure and field team to support ONPATTRO, GIVLAARI, OXLUMO, and the launch of AMVUTTRA in the U.S.

and EU, as well as launch these products into additional markets, assuming regulatory approvals.

For the three months ended March 31, 2023, the increase in selling, general and administrative expenses, as compared to the same period in 2022, was primarily due to increased compensation and related expenses as a result of increased headcount and other strategic investments in support of the global launch of AMVUTTRA and other expenses to support our strategic growth.

We expect that research and development expenses combined with selling, general and administrative expenses will increase during 2023, as compared to 2022, as we continue to advance and develop our platform and pipeline, advance our product candidates, including partnered programs, into later-stage development, prepare regulatory submissions and continue to build-out our global commercial and compliance infrastructure and field team to support our commercial portfolio as well as launch our commercial products into additional markets, assuming regulatory approvals.

However, we expect that certain expenses will be variable depending on the timing of manufacturing batches, clinical trial enrollment and results, regulatory review of our product candidates and programs, and stock-based compensation expenses due to our determination regarding the probability of vesting for performance-based awards.

1 unchanged sentence

Other (expense) income consists of the following:

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands, except percentages) 2022 2021 $ Change % Change 2022 2021 $ Change % Change

Three Months Ended March 31,

(In thousands, except percentages) 2023 2022 $ Change % Change

Interest expense $ (28,955) $ (42,362) $ 13,407 (32) %

Other (expense) income, net

Interest income 18,655 1,012 17,643 1,743 %

Realized and unrealized (losses) gains on marketable equity securities (7,850) 18,691 (26,541) (142) % (40,108) 61,273 (101,381) (165) %

Other expense, net

Realized and unrealized losses on marketable equity securities (2,267) (31,161) 28,894 (93) %

Change in fair value of development derivative liability (6,471) (13,782) 7,311 (53) %

Other (3,517) (6,331) 2,814 (44) %

Loss on the extinguishment of debt (76,586) — (76,586) N/A (76,586) — (76,586) N/A

Total $ (22,555) $ (92,624) $ 70,069 (76) %

Total other expense increased during the three and nine months ended September 30, 2022, as compared to the same periods in 2021, primarily due to a $76.6 million loss on the extinguishment of the Blackstone credit agreement, increased loss as a result of a mark-to-market adjustment related to the development derivative liability and increased realized and unrealized losses on our marketable equity securities holdings.

Total other expense decreased during the three months ended March 31, 2023, as compared to the same period in 2022, primarily due to the following:

• Decreased realized and unrealized losses on our marketable equity securities holdings;

• Decreased interest expense as a result of a more favorable interest rate under the Notes compared with the interest rate under the credit facility held with Blackstone as executed and extinguished in September 2022, respectively;

• Increased interest income driven by higher market interest rates on our marketable debt securities.

Liquidity and Capital Resources

The following table summarizes our cash flow activities:

Nine Months Ended September 30,

Three Months Ended March 31,

(In thousands) 2023 2022

Net loss $ (923,663) $ (594,364)

Non-cash adjustments to reconcile net loss to net cash used in operating activities:

536,245 250,524

Changes in operating assets and liabilities (21,878) (147,712)

Net cash used in operating activities $ (166,475) $ (171,193)

Net cash provided by investing activities 309,265 140,105

Net cash used in investing activities $ (76,217) $ (147,419)

Net cash provided by financing activities $ 46,371 $ 34,956

Effect of exchange rate changes on cash, cash equivalents and restricted cash (9,049) (5,968)

Net increase in cash, cash equivalents and restricted cash 253,236 597,412

Cash, cash equivalents and restricted cash, beginning of period

822,153 499,046

Cash, cash equivalents and restricted cash, end of period

$ 1,075,389 $ 1,096,458

Operating activities

Net cash used in operating activities decreased during the nine months ended September 30, 2022, compared to the same periods ended September 30, 2021, primarily due to decreased cash disbursements related to working capital payments and stronger cash receipts from increased product sales.

Net cash used in operating activities decreased during the three months ended March 31, 2023, compared to the same period ended 2022, primarily due to decreased cash disbursements related to working capital payments.

Investing activities

Net cash used in investing activities increased during the nine months ended September 30, 2022, compared to the nine months ended September 30, 2021, primarily due to net activities related to our marketable debt securities.

Net cash used in investing activities decreased during the three months ended March 31, 2023, compared to the same period ended 2022, primarily due to net activities related to our marketable debt securities.

Financing activities

Net cash provided by financing activities decreased during the nine months ended September 30, 2022, compared to the nine months ended September 30, 2021, primarily due to greater cash received in 2021, including $500.0 million received from our sale of one-half of our royalty interest under the Novartis agreement in September 2021 and $250.0 million received in connection with the second drawdown on our credit agreement in June 2021, offset by $136.2 million received from the issuance of convertible debt, net of repayment of credit facility and purchase of capped call transactions in September 2022.

Net cash provided by financing activities increased during the three months ended March 31, 2023, compared to the same period ended 2022, primarily due to increased net proceeds from the issuance of common stock in connection with stock option exercises and other types of equity.

Additional Capital Requirements

We currently have programs focused on a number of therapeutic areas and, as of September 30, 2022, have received regulatory approval and commercially launched four products.

However, our ongoing development efforts may not be successful and we may not be able to commence sales of any other products or successfully expand the indications for our approved products, including ONPATTRO, AMVUTTRA and OXLUMO in the future.

We currently have programs focused on a number of therapeutic areas and, as of March 31, 2023, have received regulatory approval and commercially launched four products.

In addition, we anticipate that we will continue to generate losses as a result of planned expenditures for research and development activities relating to our research platform, our drug development programs, including clinical trial and manufacturing costs, the establishment of late-stage clinical, manufacturing, commercial and compliance capabilities, including global operations, continued management and growth of our intellectual property including our patent portfolio, collaborations and general corporate activities.

Our expected working and other capital requirements are described in our 2022 Annual Report on Form 10-K in “Part II, Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.” As of September 30, 2022, other than the changes disclosed in the “Notes to Condensed Consolidated Financial Statements” and “Liquidity and Capital Resources” section in this Quarterly Report on Form 10-Q, there have been no other material changes to our expected working and other capital requirements as described in our 2021 Annual Report on Form 10-K.

Based on our current operating plan, we believe that our cash, cash equivalents and marketable equity and debt securities as of September 30, 2022, together with the cash we expect to generate from product sales and under our current alliances, including milestones and royalties on Leqvio sales, will be sufficient to enable us to advance our long-term strategic goals for at least the next 12 months from the filing of this Quarterly Report on Form 10-Q.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.” As of March 31, 2023, other than the changes disclosed in the “Notes to Condensed Consolidated Financial Statements” and “Liquidity and Capital

Resources” section in this Quarterly Report on Form 10-Q, there have been no other material changes to our expected working and other capital requirements as described in our 2022 Annual Report on Form 10-K.

Based on our current operating plan, we believe that our cash, cash equivalents and marketable equity and debt securities as of March 31, 2023, together with the cash we expect to generate from product sales and under our current alliances, will be sufficient to satisfy our near-term capital and operating needs for at least the next 12 months from the filing of this Quarterly Report on Form 10-Q.

However, due to numerous factors described in more detail under the caption Part II, Item 1A, "Risk Factors" of this Quarterly Report on Form 10-Q, we may require significant additional funds earlier than we currently expect in order to continue to commercialize our approved products, and to develop, conduct clinical trials for, manufacture and, if approved, commercialize additional product candidates.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis