Alnylam and Kyowa Hakko Form Alliance for the Development and Commercialization of ALN-RSV01 in Asia

Alnylam Pharmaceuticals, Inc. (Nasdaq: ALNY) and Kyowa Hakko Kogyo Co., Ltd. (TSE: 4151) today announced that they have formed an exclusive alliance to develop and commercialize ALN-RSV01, an RNAi therapeutic in Phase II clinical development by Alnylam for the treatment of respiratory syncytial virus (RSV) infection, in Japan and other major markets in Asia. Under the terms of the collaboration, Kyowa Hakko will pay Alnylam $15 million in an upfront cash payment and up to an additional $78 million in development and sales milestone payments. Upon commercialization, Alnylam will receive double-digit royalties from Kyowa Hakko based on the sales of ALN-RSV01 in this territory. The partnership also includes additional RSV-specific RNAi therapeutic compounds that comprise the ALN-RSV program. Alnylam retains all development and commercialization rights worldwide excluding Asia. "We are excited to have formed this new alliance with Kyowa Hakko, a Japanese biotechnology company with a strong commitment to bringing innovative new drugs to the marketplace,” said John Maraganore, Ph.D., Chief Executive Officer at Alnylam. "This new collaboration is yet another example of Alnylam’s commitment to work with leading biotechnology and pharmaceutical companies to advance RNAi therapeutics to patients on a global basis. This is an important partnership on our company’s lead clinical program in an important pharmaceutical market, and also our third significant alliance formed this year. We will provide an update on our near-term partnership goals and revised financial guidance at our upcoming second quarter conference call.” "We have been watching the progress Alnylam has made with their ALN-RSV01 program since last year and are very excited to partner with this program at this time. We are looking forward to working with Alnylam, the most scientifically advanced company in the field of RNAi, in the development and commercialization of ALN-RSV01 in Japan and other major markets in Asia,” said Yuzuru Matsuda, Ph.D., Chief Executive Officer at Kyowa Hakko. "There is a significant need for novel medicines to effectively treat patients with RSV, a leading cause of serious infections in both pediatric and adult patients. We are excited to have the opportunity in delivering the benefit of this novel medicine to patients in Asia through the partnership with Alnylam.” Earlier this year, Alnylam achieved human proof of concept for ALN-RSV01 in the Phase II GEMINI study, where intranasally administered ALN-RSV01 demonstrated statistically significant anti-viral efficacy with a 38 percent relative reduction in RSV infection rate and a 95 percent increase in the number of infection-free subjects as compared with placebo. In addition, Alnylam has initiated a Phase II clinical trial to assess the safety and tolerability of aerosolized ALN-RSV01 versus placebo in adult lung transplant patients naturally infected with RSV. As a secondary objective, this trial will also aim to evaluate the anti-viral activity of ALN-RSV01. The data from this study, in combination with the previous Phase II GEMINI trial and multiple Phase I trials, will comprise a comprehensive safety and efficacy data set with which Alnylam expects to further advance its overall ALN-RSV development program. 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. In addition, the company is developing RNAi therapeutics for the treatment of a wide range of disease areas, including hypercholesterolemia, liver cancers, and Huntington’s disease. 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, and Kyowa Hakko Kogyo. To reflect its outlook for key scientific, clinical, and business initiatives, Alnylam has established "RNAi 2010” 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 LLC, 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, visit www.alnylam.com. About Kyowa Hakko Kyowa Hakko (TSE:4151) is a biotechnology-based company focused on pharmaceutical operations engaged in the research and development, manufacturing, and marketing of prescription drugs. Kyowa Hakko is marketing medications for a wide range of diseases, including allergy, hypertension, angina pectoris, and cancer. With the aim of penetrating the global market, Kyowa Hakko has overseas development bases in the U.S. (Kyowa Pharmaceutical, Inc. and BioWa, Inc.) and in the U.K. (Kyowa Hakko U.K. Ltd.). In the U.S., the U.K., and China, Kyowa Hakko is pushing ahead with the clinical development of new drug candidates as well as the therapeutic antibody business based on Kyowa Hakko’s proprietary technology that enhances the activity of antibodies. Last October, Kyowa Hakko announced that the Kyowa Hakko group and the Kirin group entered into an agreement to form a strategic alliance. Through this strategic alliance, the two groups will endeavor to build a global leader in the research and development-driven life sciences business based in Japan, which is centered on pharmaceutical operations with strengths in biotechnology. The new company "Kyowa Hakko Kirin Co., Ltd.” will start operating on October 1, 2008. For more information on Kyowa Hakko, visit http://www.kyowa.co.jp/eng/index.htm. Alnylam Forward-Looking Statements Various statements in this release concerning Alnylam’s future expectations, plans and prospects, constitute forward-looking statements for the purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including risks related to: Alnylam’s approach to discover and develop novel drugs, which is unproven and may never lead to marketable products; obtaining, maintaining and protecting intellectual property; Alnylam’s ability to enforce its patents against infringers and to defend its patent portfolio against challenges from third parties; Alnylam’s ability to obtain additional funding to support its business activities; Alnylam’s ability to realize future milestones and royalties; Alnylam’s dependence on third parties for development, manufacture, marketing, sales and distribution of products; obtaining regulatory approval for products; competition from others using technology similar to Alnylam’s and others developing products for similar uses; Alnylam’s dependence on collaborators; and Alnylam’s short operating history; as well as those risks more fully discussed in the "Risk Factors” section of its most recent quarterly report on Form 10-Q on file with the Securities and Exchange Commission. In addition, any forward-looking statements represent Alnylam’s views only as of today and should not be relied upon as representing its views as of any subsequent date. Alnylam does not assume any obligation to update any forward-looking statements.