EPO Upholds Alnylam's McSwiggen Patent - Analyst Blog

The European Patent Office (EPO) has upheld Alnylam Pharmaceuticals, Inc.'s ALNY McSwiggen EP 1423406 ('406) patent in oral opposition proceedings in Germany. Alnylam's shares gained around 3.9% following the news.

We note that the McSwiggen patent family has 21 granted or issued patents around the world and it broadly describes chemical modifications of ribo nucleic acid interference (RNAi) therapeutics. The McSwiggen patent was obtained by Alnylam through its acquisition of Sirna Therapeutics from Merck & Co. Inc. MRK. The transaction was completed last month.

Alnylam acquired Sirna for $175 million in cash and equity. Alnylam will also pay $105 million as developmental and sales milestone payments per product along with single-digit royalties related to certain pre-clinical candidates discovered by Merck. Moreover, Alnylam will pay $10 million as milestone payments and single-digit royalties on sale of products (following commercialization) covered by Sirna's patent estate.

The McSwiggen patent estate forms a core component of Alnylam's overall intellectual property estate for the development and commercialization of RNAi therapeutics. We note that Alnylam is currently utilizing its RNAi technology to build a pipeline for the treatment of multiple diseases.

Alnylam's pipeline includes candidates like ALN-PCS (hypercholesterolemia), patisiran (transthyretin (TTR) mediated amyloidosis or ATTR), ALN-AT3 (hemophilia), ALN-TTRsc (familial amyloidotic cardiomyopathy) and ALN-TMP (hemoglobinopathies).

We are impressed by Alnylam's efforts to develop its pipeline. The company has multiple pipeline related activities in the coming quarters. We expect investor focus to remain on the development of the pipeline.

Alnylam, a biopharmaceutical company, presently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the same sector include Alexion Pharmaceuticals, Inc. ALXN and Alkermes ALKS. Both stocks hold a Zacks Rank #1 (Strong Buy).