Regulatory Designations

The Committee for

Patisiran has been granted the following regulatory designations:

As a result of the treatment of FAP. According2018 amendment to the FDA, Fast Track is a process designed to facilitateSanofi Genzyme collaboration and the Exclusive TTR License, following the closing of the transaction, we will have global rights for the development and expedite the reviewcommercialization of drugs to treat serious conditionspatisiran, together with ALN-TTRsc02, discussed below, and to fill an unmet medical need.all back-up products. The purpose is to get important new drugs to the patient earlier.

Revusiran (ALN-TTRsc). In addition to patisiran, we are also advancing revusiran, which utilizes our proprietary STC-GalNAc-conjugate approach enabling subcutaneous dose administration, with a wide therapeutic index. Revusiran is currently2014 Sanofi Genzyme collaboration, as amended in a Phase 3 clinical trial.

In December 2014, we initiated our ENDEAVOUR Phase 3 clinical trial of revusiran in TTR-mediated FAC. The ENDEAVOUR trial is a randomized, double-blind, placebo-controlled, global study designed to evaluate the efficacy and safety of revusiran in patients with FAC. The co-primary endpoints of the study are the change compared to baseline in 6-minute walk distance, or 6-MWD, and the percent reduction in TTR plasma levels between placebo- and revusiran-treated patients at 18 months. Secondary endpoints include a composite endpoint of cardiovascular mortality and cardiovascular hospitalization, New York Heart Association (NYHA) class, Kansas City Cardiomyopathy Questionnaire (KCCQ), cardiovascular, or CV, mortality, CV hospitalization and all-cause mortality. The trial is designed to enroll up to 200 FAC patients with a documented TTR mutation, including V122I or other mutations, in addition to amyloid deposits as identified by biopsy. Patients will be randomized two-to-one, revusiran-to-placebo, with subcutaneous administration at 500 mg daily for five days then weekly for 18 months. The trial design was informed by results from a natural history study which showed a progressive decrease in 6-MWD in FAC patients over an 18-month period. The ENDEAVOUR study was designed with 90% power to detect as little as 39% difference in the 18-month change from baseline for 6-MWD between treatment groups, with a significance level of p < 0.05 (two-sided). An unblinded interim analysis for futility may be conducted when 50% of patients reach 18 months. All patients completing the ENDEAVOUR Phase 3 study will be eligible to enroll in a Phase 3 OLE study.

In November 2014, we announced positive initial results from our Phase 2 open-label, multi-dose clinical trial with revusiran in TTR cardiac amyloidosis patients. Initial results from the pilot Phase 2 study from 26 patients, including 14 with FAC and 12 with SSA, were based on a data cutoff date of October 3, 2014. Study results showed that revusiran was generally well tolerated in patients with significant disease burden. The most common adverse event was injection site reaction (23% of patients). One patient had an approximate four-fold

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elevation in liver transaminases that was deemed a serious adverse event that was graded mild in severity; this event resolved during continued dosing. There were no other clinically significant adverse events, discontinuations or other clinically significant laboratory abnormalities. In addition, data showed an up to 98.2% knockdown of both mutant and wild-type forms of TTR, the disease-causing protein, with a mean maximum knockdown of 87.2% +/- 9.1%. As would be expected with the short treatment duration of five weeks, there were no significant changes observed in exploratory clinical measurements. All patients that completed dosing in our Phase 2 clinical trial are eligible to be enrolled in our open-label, Phase 2 OLE study, which was initiated in November 2014 and is designed to evaluate the tolerability and clinical activity of revusiran with long-term dosing for up to two years. In addition to data on mortality, hospitalization, general tolerability and measurement of serum TTR levels, the Phase 2 OLE study will assess the same clinical measures, every six months, included in the pilot Phase 2 trial noted aboveJanuary 2018, as well as additional measures of amyloid burden including technetium imaging of the heart and quantitation of amyloid in abdominal fat pad aspirates.Exclusive TTR License, are described below under the heading “Strategic Alliances.”

During 2014, we also initiated our DISCOVERY trial, a screening study examining the prevalence of TTR mutations in patients suspected of having cardiac amyloidosis. With this study, we aim to identify and facilitate the diagnosis of FAC.Givosiran — Acute Hepatic Porphyrias

The COMP of the EMA has designated revusiran as an orphan medicinal product for the treatment of FAC.

ALN-AT3 — Hemophilia and Rare Bleeding Disorders (RBD)

ALN-AT3Givosiran is an investigational, RNAi therapeutic targeting antithrombin, or AT, a genetically defined target, for the treatment of hemophilia and RBD. Hemophilias are hereditary disorders caused by genetic deficiencies of various blood clotting factors, resulting in recurrent bleeds into joints, muscles and other major internal organs. Hemophilia A, or HA, is defined by loss-of-function mutations in Factor VIII, and there are greater than 40,000 registered people in the United States and EU with HA. Hemophilia B, or HB, defined by loss-of-function mutations in Factor IX, affects greater than 9,500 registered people in the United States and EU. Other RBD are defined by congenital deficiencies of other blood coagulation factors, including Factors II, V, VII, X and XI. Based on our analysis of the available patient and market data, we estimate that there are approximately 1,000 people with RBD worldwide with a severe bleeding phenotype. Standard treatment for people living with hemophilia involves replacement of the missing clotting factor either as prophylaxis or on-demand therapy. However, as many as one-third of people with severe HA will develop an antibody to their replacement factor, a very serious complication. People with ‘inhibitors’ become refractory to standard replacement therapy. There remains a significant need for novel therapeutics to treat people living with hemophilia and RBD.

There exists a small subset of people living with hemophilia who have co-inherited a prothrombotic mutation, such as Factor V Leiden, antithrombin deficiency, protein C deficiency and prothrombin G20210A. People who have co-inherited these prothrombotic mutations are characterized as having a later onset of disease, lower risk of bleeding, and reduced requirements for Factor VIII or Factor IX treatment as part of their disease management. ALN-AT3 is a novel therapeutic approach aimed at re-balancing the coagulation cascade and normalizing hemostasis in severe HA and HB patients, including patients with inhibitors against their replacement factor. The program aims to reproduce the human genetic findings of a milder clinical disease in people with hemophilia who have co-inherited prothrombotic mutations.

We are evaluating ALN-AT3 in an ongoing Phase 1 study. Part A of the Phase 1 study, which is complete, was a randomized, single-blind, placebo-controlled, single-dose, dose-escalation study (n=4 per cohort; three-to-one randomization of ALN-AT3-to-placebo) in healthy volunteer subjects. This part of the study was completed after the first dose cohort that received a single subcutaneous dose of ALN-AT3 at 30 micrograms/kilogram (mcg/kg). Part B of the study, which is ongoing, is an open-label, multi-dose, dose-escalation study enrolling up to 18 subjects with moderate or severe HA or HB. The primary objective of this part of the study is to evaluate the safety and tolerability of multiple doses of subcutaneously administered ALN-AT3 in hemophilia subjects. Secondary objectives include assessment of clinical activity as determined by knockdown of circulating AT levels and increase in thrombin generation at pharmacologic doses of ALN-AT3.

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In January 2015, we announced updated results from our ongoing Phase 1 study of ALN-AT3. Specifically, new data were presented from the second dose cohort of hemophilia subjects (n=3), where ALN-AT3 was administered subcutaneously once weekly for three weeks at a low dose of 45 mcg/kg; all preliminary results are as of a data cut-off date of January 6, 2015. ALN-AT3 administration resulted in an up to 70% knockdown of AT. Based on the most advanced subject in the cohort, the nadir effect appears to occur at approximately day 28, and AT knockdown effects were found to be highly durable, lasting about 60 days. In addition, initial evidence for the potential correction of the hemophilia phenotype was observed in the severe HA subjects. Specifically, ALN-AT3 administration was found to be associated with statistically significant increase in thrombin generation of up to 334%. This level of thrombin generation increase is consistent with thrombin generation levels observed in mild hemophilia. In addition, ALN-AT3 administration was associated with improvements in whole blood clotting. Finally, as of the current data cut-off date of January 6, 2015, the most advanced subject in the study — who has a self-reported Annualized Bleeding Rate (ABR) of 10-12 bleeds per year, was found to be free of bleeding for up to 47 days in association with AT knockdown of over 50%. As of the current data cut-off,ALN-AT3 continues to be generally well tolerated in all subjects receiving study drug in the study (n=9), including subjects enrolled in the second dose cohort (n=3). The most common adverse event observed in hemophilia subjects was the occurrence of mild to moderate bleeds unrelated to study drug and consistent with an underlying hemophilia condition. All bleeds were successfully managed with replacement factor administration.

The ALN-AT3 Phase 1 study continues to enroll hemophilia subjects in additional dose cohorts, including the potential to explore a once-monthly subcutaneous dose regimen following a protocol amendment.

ALN-CC5 — Complement-Mediated Diseases

ALN-CC5 is an investigational RNAi therapeutic targeting the C5 component of the complement pathway for the treatment of complement-mediated diseases. The complement system plays a central role in immunity as a protective mechanism for host defense, but its dysregulation results in life-threatening complications in a broad range of human diseases including paroxysmal nocturnal hemoglobinuria, or PNH, atypical hemolytic-uremic syndrome, or aHUS, myasthenia gravis, neuromyelitis optica and membranous nephropathy, amongst others. Complement component C5, which is predominantly expressed in liver cells, is a genetically and clinically validated target. Loss of function human mutations are associated with an attenuated immune response against certain infections. Intravenous anti-C5 monoclonal antibody therapy (eculizumab) has demonstrated clinical activity and tolerability in a number of complement-mediated diseases. Eculizumab is approved for the treatment PNH and aHUS in the United States, Europe and other countries. A subcutaneously administered RNAi therapeutic that silences C5 represents a novel approach to the treatment of complement-mediated diseases, with a potentially competitive profile compared with intravenously administered anti-C5 monoclonal antibody therapy.

ALN-CC5 utilizes Alnylam’s ESC-GalNAc conjugate technology, which enables subcutaneous dosing with increased potency and durability and a wide therapeutic index. Our clinical trial application, or CTA, which we filed in November 2014, was approved by the U.K. Medicines and Healthcare products Regulatory Agency, or MHRA and we initiated our Phase 1/2 clinical trial with ALN-CC5 in January 2015. The Phase 1/2 study is designed in three parts: Parts A and B will be single ascending dose and multiple ascending dose studies in normal healthy human volunteers; Part C will be a study in patients with PNH.

Preclinical data presented in December 2014 shows an up to 99.2% knockdown of serum C5 and up to 96.2% inhibition of serum hemolytic activity in non-human primates, or NHPs, with continued bi-weekly or monthly subcutaneous dosing for over seven months. In addition, data showed an up to 96.9% inhibition of complement alternative pathway (CAP) activity (mean 95.1 ± 0.93%), and up to 96.2% inhibition of hemolysis (mean 88.0 ± 6.1%) with twice-monthly dosing. This level of C5 knockdown and inhibition of hemolytic activity exceeds the 80% threshold established by existing therapy and is expected to be associated with clinical benefit.

ALN-AS1 — Hepatic Porphyrias

ALN-AS1 is a subcutaneously administered, investigational RNAi therapeutic targeting aminolevulinate synthase-1, or ALAS-1,ALAS1, for the treatment of hepatic porphyrias. Porphyrias are a family of rare metabolic disorders caused by a genetic mutation in one of the eight enzymes responsible for heme biosynthesis. Hepatic

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porphyrias constitute a subset where the enzyme deficiency occurs within the liver, and includes acute intermittent porphyria, or AIP, hereditary coproporphyria and variegate porphyria. The initial focus of theALN-AS1 program is on AIP, the most common acute hepatic porphyria, whichporphyrias, or AHPs. It is duedesigned to a mutation in porphobilinogen deaminase, or PBGD. Exposuretarget and silence the ALAS1 mRNA, blocking the production of AIP patients to certain drugs, dieting or hormonal changes can trigger strong induction of ALAS-1,ALAS1 protein, the first,liver-expressed rate-limiting enzyme in the pathway, which can lead toheme biosynthesis pathway. Lowering of ALAS1 may reduce the accumulation of neurotoxic heme intermediates, upstreamALA and porphobilinogen, or PBG, that cause the clinical manifestations of the deficient PBGD enzyme that precipitateAHPs, including acute debilitating neurovisceral attacks as well as chronic disabling disease symptoms. Patients with AIP can suffer from a range of symptoms that can include acute and/or recurrent life-threatening attacks with severe abdominal pain, peripheral and autonomic neuropathy, neuropsychiatric manifestations, and possibly death if untreated or if there are delays in treatment. It is estimated that approximately 5,000 patients in the United States and Europe suffer AIPsporadic AHP attacks annually, and approximately 5001,000 patients are afflicted with recurrent, debilitating attacks.  The only availableThere are no approved therapies for prevention of acute attacks. Intravenous, or IV, hemin is currently approved for the treatment for AIP is the use of hematin, which is a preparation of heme derived from human blood. Hematin requires administration through a central intravenous lineacute AHP attacks, and is associatedsometimes used prophylactically off-label by some porphyria specialists to prevent attacks, despite its unclear efficacy, short duration of action and association with a number of complications including thrombophlebitis and iron overload.significant side effects. There is a clear unmet need for new therapies for AIP that could be both safernovel therapeutics with an enhanced efficacy and more effectivesafety profile and convenient than available therapies.durable lowering of ALA and PBG, in order to prevent attacks, diminish chronic symptoms in between attacks, and improve patients’ quality of life.

ALN-AS1 utilizes our ESC-GalNAc conjugate technology, which enables subcutaneous dosing with increased potency and durability and a wide therapeutic index, andGivosiran has the potential to be a therapyutilized for the chronic treatment of acuteAHPs. In September 2017, we aligned with the FDA on a pivotal Phase 3 trial design that includes an interim analysis based on reduction of urinary ALA as a surrogate endpoint reasonably likely to predict clinical benefit. This will enable a potential NDA filing at or around year-end 2018, pending FDA review of the program at the time of interim analysis and assuming positive results. The ENVISION Phase 3 pivotal study for givosiran was initiated in November 2017 and we expect to report interim analysis data in mid-2018.

ENVISION Trial Design:

The ENVISION Phase 3 trial is a randomized, double-blind, placebo-controlled, global, multicenter study in more than 20 countries to evaluate the efficacy and safety of givosiran in approximately 75 patients with a documented diagnosis of AHPs. Patients will be randomized on a 1:1 basis to receive 2.5 mg/kg of givosiran or placebo subcutaneously administered monthly, over a six-month treatment period. The primary endpoint is the annualized rate of porphyria attacks requiring hospitalization, urgent healthcare visit or IV hemin administration at home over the six-month treatment period. The planned interim analysis will evaluate reduction of a urinary biomarker, ALA, in 30 patients after three months of dosing, as a surrogate endpoint reasonably likely to predict clinical benefit. The interim analysis is also designed to conduct a blinded assessment of the porphyria attack rate for the purpose of a study sample size adjustment from approximately 75 patients to up to approximately 94 patients. Key secondary and exploratory endpoints will evaluate reductions in the cardinal symptoms of AHPs, such as pain, nausea and fatigue, as well as a prophylactic approachimpact on quality of life. All patients completing the six-month treatment period will be eligible to continue on an OLE study in which they will receive treatment with givosiran for the prevention of recurrent attacks. In pre-clinical studies, multi-dose administration of a GalNAc-siRNA targeting ALAS-1 ledup to rapid, dose-dependent knockdown of the ALAS-1 mRNA in NHPs, with an ED₅₀ of approximately 1.25 mg/kg. Further, in a rat model of AIP, ALN-AS1 administration at doses as low as 2.5 mg/kg resulted in a complete inhibition of phenobarbital-induced over-production of ALA and PBG, the toxic heme intermediates in AIP.30 months.

In December 2014, we filed a CTA with the Swedish Medical Products Agency, or MPA, to initiate a Phase 1 clinical trial with ALN-AS1. Per the filed CTA, theClinical Trial (Part C and OLE)

During 2017, we reported interim data from Part C of our Phase 1 clinical trial of ALN-AS1 will be performed firstgivosiran, which was conducted as a randomized, double-blind, placebo-controlled study in up to 24 patients with acute intermittent porphyria, or AIP, the most common AHP sub-type, who experienced recurrent porphyria attacks, along with data from the Phase 1 OLE study of givosiran.

As of the data transfer date of April 21, 2017, givosiran achieved potent silencing of the ALAS1 mRNA, which resulted in robust and durable lowering of ALA and PBG. Data from the OLE study demonstrated that longer-term treatment with givosiran was associated with consistent reductions in the annualized porphyria attack rate, with preliminary evidence suggesting the potential for further reductions in the attack rate with extended dosing. As of the data cutoff date, givosiran administration was generally well tolerated in recurrent attack AIP patients who are asymptomatic “high excreters,” or ASHE, patients with a mutation in the PBGD gene and elevated urinary ALA and PBG levels, but no recent symptomscohorts 1-3 in Part C of a porphyria attack. The Phase 1 clinical trial will then move to AIP patients who experience recurrent porphyria attacks. Following approval of the CTA, we expect to initiate the Phase 1 study and in mid-2015.

During 2014, we also initiatedcohorts 1 and 2 of the EXPLORE trialongoing OLE study, with our collaborators froma mean of 169 and 111 days on study, respectively, and up to 12 months on givosiran. As previously reported, one death occurred in a patient in cohort 3 in the American Porphyria Consortiumgivosiran arm due to hemorrhagic pancreatitis complicated by a pulmonary embolism and The European Porphyria Network,following a prospective observationalrecent hospitalization for bacteremia; the death was considered to be unlikely related to study of patients with hepatic porphyrias suffering from recurrent attacks. With this study, wedrug by the investigator and clinical investigators aim to learn more about the clinical course, management and disease burden of patients with hepatic porphyrias who suffer from recurrent attacks.

Additional Genetic Medicine Programsstudy's Safety Review Committee.

In addition toRegulatory Designations

Givosiran has been granted the programs described above, we are also advancing other early stage Genetic Medicine programs. These programs include: ALN-AAT, an investigational RNAi therapeutic targeting alpha-1 antitrypsin, or AAT,following regulatory designations for the treatment of AAT deficiency liver disease; ALN-GO1, an investigational RNAi therapeutic targeting glycolate oxidase, or GO, for the treatment of primary hyperoxaluria type 1, or PH1; ALN-TMP, an investigational RNAi therapeutic targeting transmembrane protease, serine 6, or TMPRSS6, for the treatment of beta-thalassemia and iron-overload disorders; and other yetAHPs:

During 2016, Sanofi Genzyme elected not to be disclosed programs. We intend to file an Investigational New Drug (IND) application, or IND equivalent, such as a CTA, for AAT in mid-2015 and to advance additional Genetic Medicine programs to support the filing of two or more INDs or IND equivalents in 2016.

Genzyme Alliance

In January 2014, we enteredopt into the 2014 Genzyme collaboration which is an exclusive relationship for the worldwide development and commercialization of RNAi therapeuticsgivosiran in the field of Genetic Medicines, which includes our current and future Genetic Medicine programs that reach human proof-of-principal study

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completion, or Human POP, by the end of 2019, subject to extension to the end of 2021 in various circumstances. We will retain product rights in North America and Western Europe, whileSanofi Genzyme will obtain exclusive rights to develop and commercialize collaboration products in the restTerritory, providing us with full global control of the world, referred to as the Genzyme Territory, together with certain broader co-development/co-promote or worldwide rightsprogram for certain products. Genzyme’s rights are structured as an opt-in that is triggered upon achievement of Human POP. We maintain development control for all programs prior to Genzyme’s opt-in and maintainfurther development and commercialization, control after Genzyme’s opt-in for all programs in our territory.

In addition to its regional rights for our current and future Genetic Medicine STAr programs in the Genzyme Territory, Genzyme has the right to either (i) co-develop and co-promote ALN-AT3 for the treatment of hemophilia and other RBD in our territory, with us maintaining development and commercialization control, or (ii) obtain a global license to ALN-AS1 for the treatment of hepatic porphyrias. Genzyme will exercise this selection right upon the completion of Human POP for both the ALN-AT3 and ALN-AS1 programs. Finally, Genzyme has the right for a global license to a single, future Genetic Medicine program that was not one of our defined Genetic Medicine programs as of the effective date of the 2014 Genzyme collaboration. We will retain global rights to any RNAi therapeutic Genetic Medicine program that does not reach Human POP by the end of 2019, subject to certain limited exceptions.

We are leading development and commercialization of patisiran in North America and Western Europe while Genzyme will develop and commercialize the product in the Genzyme Territory. In addition, we and Genzyme are co-developing and co-commercializing revusiran in North America and Western Europe, with Genzyme developing and commercializing the product in the Genzyme Territory.

if approved. The 2014 Sanofi Genzyme collaboration, as amended in January 2018, is described below under the heading “Strategic Alliances.”

Fitusiran — Hemophilia and Rare Bleeding Disorders

Fitusiran is a subcutaneously administered, investigational RNAi therapeutic targeting antithrombin, or AT, for the treatment of people with hemophilia A and B, with and without inhibitors.  Fitusiran also has the potential to be used for rare bleeding disorders, or RBD. Fitusiran is designed to lower levels of AT with the goal of promoting sufficient thrombin generation to prevent bleeding. AT acts by inactivating thrombin and other coagulation factors, and plays a key role in normal hemostasis by helping to limit the process of fibrin clot formation. Hemophilia is a hereditary bleeding disorder characterized by an underlying defect in the ability to generate adequate levels of thrombin needed for effective fibrin clot formation, thereby resulting in recurrent bleeds into joints, muscles, and major internal organs. Lowering AT in the hemophilia setting may promote the generation of sufficient levels of thrombin needed to form an effective fibrin clot and prevent bleeding. This rationale is supported by human genetic data suggesting that co-inheritance of thrombophilic mutations, including AT deficiency, may ameliorate bleeding in hemophilia. We believe this approach is a unique and innovative strategy for preventing bleeding in people with hemophilia.

There are approximately 200,000 people living with hemophilia A and hemophilia B worldwide. Standard treatment for people with hemophilia currently involves replacement of the deficient clotting factor either as prophylaxis or on-demand therapy, which can lead to a temporary restoration of thrombin generation capacity. However, with current factor replacement treatments people with hemophilia are at risk of developing neutralizing antibodies, or inhibitors, to their replacement factor, a very serious complication affecting as many as one third of people with severe hemophilia A and a smaller fraction of people with hemophilia B. People who develop inhibitors become refractory to replacement factor therapy and are twice as likely to be hospitalized for a bleeding episode.

During 2017, we initiated the ATLAS Phase 3 program to evaluate the safety and efficacy of fitusiran in people with hemophilia A and B, with and without inhibitors. Fitusiran is also currently being evaluated in an ongoing Phase 2 OLE study.  In September 2017, we reported a fatal thrombotic event in a patient with hemophilia A without inhibitors in the Phase 2 OLE study of fitusiran.  As a result, we elected to suspend dosing in all ongoing fitusiran studies pending review of the safety event and development of a risk mitigation strategy.  In early November 2017, we and the FDA reached alignment on clinical risk mitigation measures, including protocol-specified guidelines and additional investigator and patient education concerning reduced doses of replacement factor or bypassing agent to treat any breakthrough bleeds in fitusiran studies. Based on this, amended protocols were submitted to the regulatory authorities and in December 2017, the FDA lifted the clinical hold.  Dosing has resumed in the Phase 2 OLE study and we expect to begin dosing patients in the ATLAS Phase 3 program in early 2018.

Cardio-Metabolic Disease STArATLAS Phase 3 Clinical Program

Trial Design: ATLAS is a global, multicenter program designed to evaluate the safety and efficacy of fitusiran in three separate trials, including patients with hemophilia A and B with or without inhibitors.

Phase 2 OLE Clinical Study

In our Cardio-Metabolic Disease STAr,July 2017, we are advancing our pipelinereported interim results from the ongoing fitusiran Phase 2 OLE study which includes patients with hemophilia A and B, and includes 14 patients with inhibitors, including one with hemophilia B. As of investigational RNAi therapeutics toward genetically validated, liver-expressed disease targets for unmet needsa June 15, 2017 data transfer date, once-monthly subcutaneous administration of fitusiran achieved lowering of AT, increases in dyslipidemias, hypertension, NASHthrombin generation, and, type 2 diabetes. We believe that new discoveriesin a post-hoc exploratory analysis, reductions in the human geneticsmedian estimated ABR in patients with and without inhibitors. With respect to safety, three SAEs were considered possibly related to study drug, including one fatal cerebral venous sinus thrombosis, as noted above, that occurred after the data cutoff date.  The majority of cardio-metabolic disease, together with innovative clinical development strategiesAEs were mild or moderate in morbid sub-populations, create opportunitiesseverity.

Regulatory Designations

Fitusiran has been granted the following regulatory designations for new, potentially transformative medicines. Further, we believe the emerging profiletreatment of our ESC-GalNAc conjugates with once-monthlyhemophilia A and possibly once-quarterly, low-volume, subcutaneous dose administrationB:

As a result of the January 2018 amendment to the Sanofi Genzyme collaboration and a wide therapeutic index supports advancementthe AT3 License Terms, following the closing of new medicinesthe transaction, Sanofi Genzyme will have global rights to develop and commercialize fitusiran.  We expect to substantially complete the transition of the fitusiran program to Sanofi Genzyme by mid-2018.  The 2014 Sanofi Genzyme collaboration, as amended in this disease area. We intend to seek strategic collaboration opportunities for programs in our Cardio-Metabolic Disease STAr, while retaining significant product commercialization rights inJanuary 2018, as well as the United States and EU.

Our Cardio-Metabolic Disease development programsAT3 License Terms, are described in more detail below.below under the heading “Strategic Alliances.”

ALN-PCSInclisiran   — Hypercholesterolemia

ALN-PCSscInclisiran is a subcutaneously administered, investigational RNAi therapeutic targeting proprotein convertase subtilisin/kexin type 9, or PCSK9, for the treatment of hypercholesterolemia. PCSK9 is a protein involved in the regulation of low-density lipoprotein receptor, or LDL receptor, levels on hepatocytes and the metabolism of LDL cholesterol, or LDL-C, which is commonly referred to as “bad” cholesterol. PCSK9 is produced by the liver and circulates in the bloodstream. Both intracellular and extracellular PCSK9 reduce the liver’s capacity to absorb LDL-C by decreasing LDL receptor levels. Published studies indicate that, if PCSK9 activity could be reduced, the liver’s uptake of LDL-C should increase and blood cholesterol levels should decrease. In fact, published case reports have shown individuals with loss-of-function genetic mutations

Despite advances in PCSK9 have decreased blood cholesterol levels. In turn, these individuals have been shown to have a dramatically reduced risk of coronary arterytreatment, cardiovascular disease, or CAD, including myocardial infarction or heart attack. In addition, studies have shown that PCSK9 levels are increased by statin therapy, limiting their effect, suggesting that the introduction of a PCSK9 inhibitor to statin therapy may result in even further reductions in LDL-C levels. HypercholesterolemiaCVD, is a condition characterized by very high levels of cholesterol in the blood which is known to increase the risk of coronary artery disease, the leading cause of death worldwide, resulting in over 17 million deaths annually. Eighty percent of all CVD deaths are due to coronary heart disease, or CHD, or strokes. Elevated LDL-C is a major risk factor for the United States. Some formsdevelopment of hypercholesterolemia canCVD and has recently been described as causative. Lowering LDL-C has been shown to reduce the risk of cardiovascular death or heart attack, and within the range of effects achieved so far, the clinical risk reduction is linearly-proportional to absolute LDL-C reduction.

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beApproximately 100 million people worldwide are treated through dietary restrictions, lifestyle modifications (e.g., exercisewith lipid lowering therapies, predominantly statins, to reduce LDL-C and smoking cessation)the associated risk of death, nonfatal myocardial infarction and medicines such as statins.nonfatal stroke or associated events. However, a large proportionresidual risk for cardiovascular events remains and statins are associated with well-known limitations. First, not all subjects reach LDL-C levels associated with optimal protection against clinical events. Second, not all subjects tolerate statins or are able to take statins at sufficiently-intensive doses. Third, observational studies have demonstrated that >50 percent of patients do not adhere to statin therapy for more than six months. Despite statins alone or in combination with hypercholesterolemia, including genetic other lipid lowering medications, current therapies for the management of elevated LDL-C remain insufficient in some subjects. This is particularly true in patients with pre-existing CHD and/or diabetes or a history of familial hypercholesterolemia, patients, acute coronary syndrome patients, high-risk patient populations (e.g., patients with CAD, diabetes, symptomatic carotid artery disease)or FH, who are at the highest risk and other patients that are statin intolerant, are not achieving target LDL-C goals with statin therapy. Severe forms of hypercholesterolemia are estimated to affect more than 500,000 patients worldwide, and as a result, thererequire the most intensive management. There is a significantan unmet need for novel therapeutics to treat patients with hypercholesterolemia whose disease is inadequately managed by existing therapies.

In December 2014, we initiated a Phase 1 clinical trial withALN-PCSsc. The Phase 1 trial is being conducted in the U.K. as a randomized,single-blind,placebo-controlled, singleascending- andmulti-dose study. The study is designed to enroll up to 76 volunteer subjects with elevated baseline LDL-C (³ 100 mg/dL), with subjects randomized three-to-one, drug-to-placebo. The study will be performed in two phases: a single ascending dose, or SAD, phase and a multiple dose, or MD, phase. In the MD phase, subjects will receive two subcutaneous doses of either ALN-PCSsc or placebo administered four weeks apart. The MD phase will also include subjects both on and off statin co-medication. The primary objectiveadditional treatment options beyond currently-available treatments for lowering of the Phase 1 study isLDL-C level to evaluate the safety and tolerability of ALN-PCSsc. Secondary objectives include assessment of clinical activity as determined by knockdown of plasma PCSK9 levels and serum LDL-C levels, as well as pharmacokinetics of ALN-PCSsc.reduce cardiovascular risk.

ALN-PCSsc utilizes our proprietary ESC-GalNAc-siRNA conjugate delivery platform. Pre-clinical data in NHPs demonstrates that monthly subcutaneous administration of ALN-PCSsc resulted in PCSK9 knockdown of up to 92% and LDL-C lowering, in the absence of statin co-administration, of up to 77%; mean maximum knockdown of PCSK9 was 83.2% +/- 7.2%, and mean maximum LDL-C reduction was 59.0% +/- 13.3%. As a PCSK9 synthesis inhibitor, ALN-PCSsc showed rapid, durable and clamped knockdown of PCSK9 and reduction of LDL-C, which contrasts with the cyclical variation in LDL-C observed with monthly dose regimens of anti-PCSK9 monoclonal antibodies. In aggregate, these pre-clinical data are supportive of a once-monthly, and possibly once-quarterly, dosing regimen for ALN-PCSsc, which we believe could represent a highly competitive target product profile.

In February 2013, we and MDCO entered into a license and collaboration agreement pursuant to which we granted to MDCO an exclusive, worldwide license to develop, manufacture and commercialize RNAi therapeutics targeting PCSK9 for the treatment of hypercholesterolemia and other human diseases. Under the terms of the agreement, we will complete certain pre-clinical studiesMDCO assumed responsibility for the development and a Phase 1 clinical studycommercialization of ALN-PCSsc, and MDCO is responsible for leading and funding developmentinclisiran from Phase 2 forward as well as potential commercialization.forward. A description of our agreement with MDCO is included below under the heading “Strategic Alliances.”

In 2017, MDCO initiated the ORION Phase 3 program for inclisiran, a comprehensive set of clinical trials to assess LDL-C lowering and safety in a wide range of patients.  The Phase 3 program includes the four pivotal Phase 3 clinical trials described below and represents the largest clinical experience for an investigational RNAi therapeutic to date:

Additional Cardio-Metabolic Disease ProgramsORION-1 Phase 2 Clinical Trial

In additionDuring 2017, we and MDCO reported final results from ORION-1, a placebo-controlled, double-blind, randomized Phase 2 study of inclisiran in patients (N=501) with ASCVD or ASCVD-risk equivalents (e.g., diabetes and FH) and elevated LDL-C despite maximum tolerated doses of LDL-C lowering therapies.  The Phase 2 study, conducted by MDCO, compared the effect of different doses of inclisiran and evaluated the potential for an infrequent dosing regimen. The primary endpoint of the study was the percentage change in LDL-C from baseline at Day-180. Inclisiran demonstrated significant and sustained reductions in LDL-C of over 50 percent. For all dose groups, at all time points, differences in the primary (LDL-C) and secondary (PCSK9) endpoints between inclisiran and placebo were statistically significant (p < 0.0001). Inclisiran represents the largest safety experience for one of our investigational RNAi therapeutics to ALN-PCSsc, we are also advancing other early stage Cardio-Metabolic Disease programs. These programs include additional investigational programsdate.  Inclisiran was generally well tolerated and no material safety issue was observed, including no significant elevations of liver enzymes considered related to study medication and no neuropathy, change in renal function, thrombocytopenia or anti-drug antibodies.  

The results from the Phase 2 study of inclisiran were published in April 2017 in The New England Journal of Medicine.

Regulatory Designations

Inclisiran has been granted the following regulatory designation for the treatment of dyslipidemias, includingHoFH:

ALN-AC3Early Stage Clinical Development Programs

ALN-TTRsc02 —  TTR-Mediated (ATTR) Amyloidosis

ALN-TTRsc02 is a subcutaneously administered, investigational RNAi therapeutic targeting Apolipoprotein C3, or ApoC3,TTR for the treatment of hypertriglyceridemia and ALN-ANG targeting Angiopoetin-like 3, or ANGPTL3,ATTR amyloidosis, representing an extension of our program for ATTR amyloidosis, discussed in more detail above under the heading “Patisiran.”  We believe ALN-TTRsc02 has the potential to offer an attractive option for patients as a once-quarterly, low-volume, subcutaneously administered RNAi therapeutic for the treatment of hypertriglyceridemiaATTR amyloidosis.

We are evaluating ALN-TTRsc02 in a randomized, placebo-controlled, single ascending-dose Phase 1 study in healthy volunteers and mixed hyperlipidemia. In addition, we expect to advance ALN-TTRsc02 into a Phase 3 clinical trial in late 2018.

As a result of the 2018 amendment to the Sanofi Genzyme collaboration and the Exclusive TTR License, following the closing of the transaction, we will have global rights for the development and commercialization of patisiran, discussed above, together with ALN-TTRsc02 and all back-up products. The 2014 Sanofi Genzyme collaboration, as amended in January 2018, as well as the Exclusive TTR License, are developing ALN-AGT,described below under the heading “Strategic Alliances.”

Lumasiran (ALN-GO1) — Primary Hyperoxaluria 1

Lumasiran is an investigational RNAi therapeutic targeting angiotensinogen,glycolate oxidase, or AGT,GO, in development for the treatment of hypertensive disordersprimary hyperoxaluria type 1, or PH1.  PH1 is an autosomal recessive disorder of pregnancy including preeclampsia. Finally, weglyoxylate metabolism, resulting in excessive oxalate production. Excess oxalate in PH1 patients results in the deposition of calcium oxalate crystals in the kidneys and urinary tract and can lead to the formation of recurrent kidney stones or nephrocalcinosis. Renal damage is caused by a combination of tubular toxicity from oxalate, calcium oxalate deposition in the kidneys, and urinary obstruction by calcium oxalate stones. Compromised kidney function exacerbates the disease as the excess oxalate can no longer be effectively excreted, resulting in subsequent accumulation and crystallization in bones, eyes, skin, and heart, leading to severe illness and death. Lumasiran is designed to reduce the hepatic levels of the GO enzyme, thereby depleting the substrate necessary for oxalate production, which directly contributes to the pathophysiology of PH1. 

We are advancing a number of undisclosed pre-clinical programsevaluating lumasiran for the treatment of NASHpatients with PH1 in a randomized, single-blind, placebo-controlled Phase 1/2 clinical trial.

Sanofi Genzyme has the right to opt in to develop and type 2 diabetes. We intend to advance additional Cardio-Metabolic Disease programs to support the filing of at least one IND or IND equivalent in 2016.

Hepatic Infectious Disease STAr

In our Hepatic Infectious Disease STAr, we are advancing a pipeline of investigational RNAi therapeutics that address major global health challenges, including but not limited to HBV. We intend to seek strategic collaboration opportunities for programs in our Hepatic Infectious Disease STAr, while retaining significant product commercialization rightscommercialize lumasiran in the United StatesSanofi Genzyme Territory and EU.could elect to exercise its one right to a global license for lumasiran. The 2014 Sanofi Genzyme collaboration, as amended in January 2018, is described below under the heading “Strategic Alliances.”

Cemdisiran (ALN-CC5) —  Complement-Mediated Diseases

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Our Hepatic Infectious Disease development programs are described in more detail below.

ALN-HBV — Hepatitis B Virus (HBV)

HBVCemdisiran is the most common serious liver infection in the world. Worldwide, two billion people (one out of three people) have been infected with HBV and 400 million people have become chronically infected. An estimated one million people die each year from HBV and its complications worldwide; about 5,000 of those are in the United States. The clinical manifestations are severe. Worldwide, chronic infection with hepatitis causes 80% of all hepatocellular carcinoma, or HCC, and more than 500,000 people die each year from this form of cancer. About five percent of the population are chronic carriers of HBV, and nearly 25% of all carriers develop serious liver diseases such as chronic hepatitis, cirrhosis and HCC. Despite the use of nucleoside analog inhibitors of viral DNA synthesis and interferon therapies, the cure rate for chronic HBV infection is less than ten percent. Reduction in HBV surface antigen, or HBsAg, levels of over 0.5 log₁₀ is the single best predictor of immunologic cure. We believe an RNAi therapeutic targeting the HBV genome could have the potential to achieve a “functional cure” by effectively decreasing expression of HBsAg, in addition to inhibiting all steps of the HBV life cycle.

During 2014, we identified a Development Candidate for our ALN-HBV program. The ALN-HBV Development Candidate is an ESC-GalNAc-siRNA targeting the HBV genome. In a rodent model of HBV, a single subcutaneous dose at 3 mg/kg resulted in an up to 3.9 log₁₀ reduction in HBsAg levels (mean 1.8 log₁₀ reduction). We expect to file an IND or IND equivalent for this program in late 2015.

Our ALN-HBV program derives from our 2014 acquisition of the RNAi assets of Merck, including Sirna.

Additional Hepatic Infectious Disease Programs

In addition to ALN-HBV, we are also advancing other early stage Hepatic Infectious Disease programs. These programs include: ALN-HDV, an investigational RNAi therapeutic targeting the hepatitis delta virus, or HDV,C5 component of the complement pathway in development for the treatment of HDV infection; ALN-PDL,complement-mediated diseases. The complement system plays a central role in immunity as a protective mechanism for host defense, but its dysregulation results in life-threatening complications in a broad range of human diseases including paroxysmal nocturnal hemoglobinuria, or PNH, and aHUS, amongst others. Complement component C5, which is predominantly expressed in liver cells, is a genetically and clinically validated target; loss-of-function human mutations are associated with an investigationalattenuated immune response against certain infections and intravenous anti-C5 monoclonal antibody, or mAb, therapy has demonstrated clinical activity and tolerability in a number of complement-mediated diseases. A subcutaneously administered RNAi therapeutic targeting hepatocyte-expressed programmed death ligand 1, or PD-L1, an immune checkpoint inhibitor,that silences C5 represents a novel approach for the potential treatment of complement-mediated diseases.

We are evaluating cemdisiran for the treatment of chronic liver infections;patients with aHUS in a Phase 2 clinical trial initiated in September 2017.

During 2016, Sanofi Genzyme elected not to opt into the development and commercialization of cemdisiran in the Sanofi Genzyme Territory, providing us with full global control of the program for further development and commercialization, if approved. The 2014 Sanofi Genzyme collaboration, as amended in January 2018, is described below under the heading “Strategic Alliances.”

Additional Early Stage and Pre-clinical Programs

In addition to the programs listed above, we are also advancing other yetearlier-stage clinical pipeline programs and expect multiple data read-outs throughout 2018. We also plan to be disclosed programs.file one or more new clinical trial applications, or CTAs, in 2018, and to advance our infectious disease collaboration with Vir Biotechnology.

Our Collaboration and Licensing Strategy

Our business strategy is to develop and commercialize a broad pipeline of RNAi therapeutic products directed towards our three STArs: Genetic Medicines; Cardio-Metabolic Diseases; and Hepatic Infectious Diseases. As part of this strategy, we have entered into, and expect to enter into additional, collaboration and licensing agreements as a means of obtaining resources, capabilities and funding to advance our investigational RNAi therapeutic programs.

Our collaboration strategy is to form alliances that create significant value for ourselves and our collaborators in the advancement of RNAi therapeutics as a potential new class of innovative medicines. Specifically, with respect to our Genetic Medicine pipeline, we formed a broad strategic alliance with Sanofi Genzyme in 2014 pursuant to which we retain development and commercial rights for our current and future Genetic Medicine products in North Americathe United States, Canada and Western Europe, and Sanofi Genzyme will develop and commercialize our current and future Genetic Medicine products principallyfor which it elects to opt-in, in territories outsidethe rest of North America and Western Europe,the world, subject to certain broader rights. In January 2018, we and Sanofi Genzyme amended our 2014 collaboration to provide that we would develop and commercialize patisiran globally and Sanofi Genzyme would develop and commercialize fitusiran globally. With respect to our Cardio-Metabolic and Hepatic Infectious Disease pipelines,pipeline, we intend to seek future strategic alliances for these programs, while retaining significantunder which we may retain certain product commercialization rights in the United States and EU. We currently have a global alliance with MDCO for the development and commercialization ofrights, or we may structure as global alliances, as we did in our ALN-PCSsc program.

We also seekcollaboration with MDCO to form or advance new ventures and opportunitiesinclisiran. With respect to our Hepatic Infectious Disease pipeline, in areas outside our primary focus on RNAi therapeutics. In 2007,October 2017, we and Isis formed Regulus to capitalize on our technology and intellectual property in the field of microRNA therapeutics. Currently, we own approximately 12% of Regulus’ outstanding common stock.

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To generate revenues from our intellectual property rights, we also grant licenses to biotechnology companies under our InterfeRx programannounced an exclusive licensing agreement with Vir Biotechnology for the development and commercialization of RNAi therapeutics for specified targets in which we have no direct strategic interest. infectious diseases, including chronic hepatitis B virus infection.

We also have entered into license key aspects of ouragreements to obtain rights to intellectual property to companies active in the research products and services market, which includes the manufacture and salefield of reagents. We expect our InterfeRx and research product licenses to generate modest revenues that we can re-invest in the development of our proprietary RNAi therapeutics pipeline. As of January 31, 2015, we had granted such licenses, on both an exclusive and non-exclusive basis, to approximately 20 companies.

SinceRNAi. In addition, because delivery of RNAi therapeutics has historically been an important objective of our research activities, we have also evaluated potentialentered into various collaboration and licensing arrangements with other companies and academic institutions to gain access to delivery technologies. For example, we entered into agreements with Tekmira Pharmaceuticals Corporation, or TPC, Protiva Biotherapeutics, Inc., a wholly owned subsidiary of TPC, and together with TPC, referred to as Tekmira, The University of British Columbia, or UBC, and Acuitas Therapeutics Inc. (formerly AlCana Technologies, Inc.), or Acuitas, among others, related totechnologies, including various LNP delivery technologies.

We have also entered into license agreements with Isis, Max Planck Innovation GmbH (formerly known as Garching Innovation GmbH), or Max Planck Innovation, Tekmira, Cancer Research Technology Limited, or CRT, and Whitehead Institute for Biomedical Research, or Whitehead, as well as a number of other entities, to obtain rights to intellectual property in the field of RNAi. Finally, we have sought, and may seek in the future, funding for the development of our proprietary RNAi therapeutics pipeline from the government and foundations.

Strategic Alliances

We have formed, and intend to continue to form, strategic alliances to gain access to the financial, technical, clinical and commercial resources necessary to develop and market RNAi therapeutics. We expect these alliances to provide us with financial support in the form of upfront cash payments, license fees, equity investments, research, development, and developmentsales and marketing funding, milestone payments and/or royalties or profit sharing based on sales of RNAi therapeutics. Below is a brief description of our key strategic alliance and license agreements.

Product Alliances.

Sanofi Genzyme.Genzyme.    In January 2014, we entered into a global, strategic collaboration with Sanofi Genzyme to discover, develop and commercialize RNAi therapeutics as Genetic Medicines to treat orphan diseases.  The 2014 Genzyme collaboration supersededOn January 6, 2018, we and replaced the previous collaboration between us andSanofi Genzyme entered into in October 2012an amendment to develop and commercialize RNAi therapeutics targeting TTR for the treatment of ATTR, including patisiran and revusiran, in Japan and the Asia-Pacific region.

The 2014 Sanofi Genzyme collaboration, which is structured as an exclusive relationship for the worldwide development and commercialization of RNAi therapeutics in the field of Genetic Medicines, which includesMedicines. In connection and simultaneously with entering into the 2018 amendment to the 2014 Sanofi Genzyme collaboration, we and Sanofi Genzyme also entered into the Exclusive TTR License with respect to all TTR products, including patisiran, ALN-TTRsc02 and any back-up products, and the AT3 License Terms with respect to fitusiran and any back-up products.  

Under the 2014 Sanofi Genzyme collaboration, Sanofi Genzyme has certain rights to our current and future Genetic Medicine programs that reach Human POP by the end of 2019, subject to extension to the end of 2021 in various circumstances.  We will retain product rights in North America and Western Europe, referred to asUnder the Alnylam Territory, while2014 Sanofi Genzyme will obtain exclusive rights to develop and commercialize collaboration, products in the Genzyme Territory, together with certain broader co-development/co-promote or worldwide rights for certain products. Genzyme’s rights, described in detail below, are structured as an opt-in that is triggered upon achievement of Human POP. We maintain development control for all programs prior to Genzyme’s opt-in and maintainwe were leading development and commercialization control after Genzyme’s opt-in for all programs in the Alnylam Territory.

Specifically, in addition to its regional rights for our current and future Genetic Medicine programs in the Genzyme Territory, Genzyme has the right to either (i) co-develop and co-promote ALN-AT3 for the treatment of hemophilia and other RBD in the Alnylam Territory, with us maintaining development and commercialization control, or (ii) obtain a global license to ALN-AS1 for the treatment of hepatic porphyrias. Genzyme may

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exercise this selection right upon the completion of Human POP for both the ALN-AT3 and ALN-AS1 programs. Finally, Genzyme has the right for a global license to a single, future Genetic Medicine program that was not one of our defined Genetic Medicine programs as of the effective date of the 2014 Genzyme collaboration. We will retain global rights to any RNAi therapeutic Genetic Medicine program that does not reach Human POP by the end of 2019, subject to certain limited exceptions. We retain full rights to all current and future RNAi therapeutic programs outside of the field of Genetic Medicines, including the right to form new collaborations.

Under the 2014 Genzyme collaboration, Genzyme’s specific license rights include the following:

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Due toJanuary 2018, as well as the uncertainty of pharmaceutical developmentExclusive TTR License and the high historical failure rates generally associated with drug development, we may not receive any additional milestone payments or any royalty payments from Genzyme under the 2014 Genzyme collaboration.

Under the master agreement, the parties will collaborate in the development of option products, with us leading development for all programs prior to Genzyme’s opt-in and also leading development and commercialization for all programs in the Alnylam Territory after Genzyme’s opt-in. If Genzyme does not exercise its option to license rights to a particular program, we will retain the exclusive right to develop and commercialize such program throughout the world,AT3 License Terms, including the rightongoing or expected financial and accounting impact on our business, please read Note 3, Significant Agreements, to sublicense to third parties.

The 2014 Genzyme collaboration is governed by an alliance joint steering committee that is comprised of an equal number of representatives from each party. There will also be additional committees to manage various aspects of each regional, co-developed/co-promotedour consolidated financial statements included in Part II, Item 8, “Financial Statements and global program. We and Genzyme intend to enter into supply agreements to provide for supply of collaboration products to Genzyme for clinical studies, and, at Genzyme’s request, commercial sales. Genzyme also has certain rights to manufacture collaboration products. Additionally, Genzyme has certain limited opt-out rights, as specified in the master agreement, upon which products revert fully back to us with no further obligations to Genzyme.

The master agreement (including the license terms appended thereto) contains certain termination provisions, including for material breach by the other party. Unless terminated earlier pursuant to its terms, the master agreement will terminate upon the last to expire of any of the option periods under the master agreement or the license terms appended thereto.

In consideration for the rights granted to Genzyme under the master agreement and pursuant to the terms of a stock purchase agreement dated January 11, 2014, upon the closing of the equity transaction in February 2014, we sold to Genzyme 8,766,338 shares of our common stock and Genzyme paid $700.0 million in aggregate cash consideration to us. As a condition to the closing of the equity transaction, Genzyme entered into an investor agreement with us. Under the investor agreement, until the earlier of the fifth anniversary of the expiration or earlier termination of the 2014 Genzyme collaboration and the date on which Genzyme and its affiliates cease to beneficially own at least 5% of our outstanding common stock, Genzyme and its affiliates are bound by certain “standstill” provisions. The standstill provisions include agreements not to acquire more than 30% of our outstanding common stock, call stockholder meetings, nominate directors other than those approved by our board of directors, subject to certain limited exceptions, or propose or support a proposal to acquire us. Further, Genzyme has agreed to vote, and cause its affiliates to vote, all shares of our voting securities they are entitled to vote, up to a maximum of 20% of our outstanding common stock, in a manner either as recommended by our board of directors or proportionally with the votes cast by our other stockholders, except with respect to certain change of control transactions or our liquidation or dissolution. Until Genzyme owns less than 7.5% of our outstanding common stock, subject to Genzyme’s limited right to maintain its ownership percentage as described below, if we issue common stock or securities convertible into or exercisable for common stock to a third party that holds at least 30% of our outstanding common stock or, in connection with a collaboration or license transaction, to a third party that will initially hold at least the percentage of our outstanding common stock represented by the shares purchased by Genzyme at the closing of the equity transaction, we will offer Genzyme an opportunity to amend the standstill and voting provisions in the investor agreement to be consistent with the terms provided to such third party.

Under the investor agreement, Genzyme has also agreed not to dispose of any shares of common stock beneficially owned by it immediately after the closing of the stock purchase until the earlier of (i) December 31, 2019 (subject to extension by up to two years if Genzyme’s option to select additional compounds under the master agreement is extended beyond December 31, 2019) and (ii) six months after the expiration or earlier valid termination of the collaboration, in each case subject to earlier termination in the event certain clinical activities under the collaboration fail to occur. Following the expirationSupplementary Data,” of this lock-up period, Genzyme will be permitted to sell such shares of common stock subject to certain limitations, including volume and manner of sale restrictions. Notwithstanding the foregoing, following the two-year anniversary of the closing of the stock purchase, in the event that the market price per share of our common stock is at least 100% higher than the

us a percentage of specified fees from certain sublicense agreements Monsanto may enter into that include access to our intellectual property, as well as low single-digit royalty payments on worldwide, net sales by Monsanto, its affiliates and sublicensees of certain licensed products, as defined in  For more information regarding the Monsanto agreement, if any. Dueincluding its ongoing financial and accounting impact on our business, please read Note 3, Significant Agreements, to the uncertaintyour consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of the application of RNAi technology in the field of agriculture, we may not receive any license fees or royalty payments from Monsanto.this annual report on Form 10-K.

The term of the Monsanto agreement generally ends upon the expiration of the last-to-expire patent licensed under the agreement. We estimate that our fundamental RNAi patents licensed under the Monsanto agreement will expire both in and outside the United States generally between 2016 and 2025, subject to any potential patent term extensions and/or supplemental protection certificates extending such term extensions in countries where such extensions may become available. Monsanto may terminate the Monsanto agreement in its entirety upon 30-days’ prior written notice to us, provided, however, that Monsanto is required to continue to make royalty payments to us if any royalties were payable on net sales of a licensed product during the previous 24 months. The Monsanto agreement may also be terminated by either party in the event the other party fails to cure a material breach under the Monsanto agreement.

Under the terms of the Monsanto agreement, in the event that during the exclusivity period we cease to own or otherwise exclusively control certain licensed patent rights in the agriculture field, for any reason other than Monsanto’s breach of the Monsanto agreement or its negligence or willful misconduct, resulting in the loss of exclusivity with respect to Monsanto’s rights to such patent rights, and such loss of exclusivity has a material adverse effect on the licensed products, then we would be required to pay Monsanto up to $5.0 million as liquidated damages, and Monsanto’s royalty obligations to us under the Monsanto agreement would be reduced or, under certain circumstances, terminated. We have the right to cure any such loss of patent rights under the Monsanto agreement.

Takeda Pharmaceutical Company Limited.Takeda.    In May 2008, we entered into a license and collaboration agreement with Takeda Pharmaceutical Company Limited, or Takeda, to pursue the development and commercialization of RNAi therapeutics. Under the Takeda agreement, we granted to Takeda a non-exclusive, worldwide, royalty-bearing license to our intellectual property, including delivery-related intellectual property, controlled by us as of the date of the Takeda agreement or during the five years thereafter, to develop, manufacture, use and commercialize RNAi therapeutics, subject to our existing contractual obligations to third parties. The license initially is limited to the fields of oncology and metabolic disease and may be expanded at Takeda’s option to include other therapeutic areas, subject to specified conditions.

Takeda paid us an upfront payment of $100.0 million and an additional $50.0 million upon achievement of specified technology transfer milestones. In addition, for each RNAi therapeutic product developed by Takeda, its affiliates and sublicensees, we are entitled to receive specified development, regulatory and commercialization milestone payments, totaling up to $171.0 million per product, together with a double-digit percentage royalty payment based on worldwide annual net sales, if any. The potential future milestone payments per product include up to $26.0 million for the achievement of specified development milestones, up to $40.0 million for the achievement of specified regulatory milestones and up to $105.0 million for the achievement of specified commercialization milestones. Due to the uncertainty of pharmaceutical development and the high historical failure rates generally associated with drug development, we may not receive any additional milestone payments or any royalty payments from Takeda.

The collaboration is governed by a joint technology transfer committee, a joint research collaboration committee and a joint delivery collaboration committee, each of which is comprised of an equal number of representatives from each party. The term of  For more information regarding the Takeda agreement, generally ends upon the later of (i) the expiration ofincluding its ongoing financial and accounting impact on our last-to-expire patent covering a licensed product and (ii) the last-to-expire term of a profit sharing agreement in the event we elect to enter into such an agreement. We estimate that our fundamental RNAi patents covered under the Takeda agreement will expire both in and outside the United States generally between 2016 and 2025, subject to any potential patent term extensions and/or supplemental protection certificates extending such term extensions in countries where such extensions may become available. The Takeda agreement may be terminated by either party in the event the other party fails to cure a material breach under the agreement. In addition, Takeda may terminate the agreement on a licensed product-by-licensed product or country-by-country basis upon 180-days’ prior written notice to us, provided, however, that Takeda is required to continue to make royalty payments to us for the duration of the royalty term with respect to a licensed product.

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Roche/Arrowhead.    In July 2007, we and, for limited purposes, Alnylam Europe AG, or Alnylam Europe, entered into a license and collaboration agreement with Roche. Under the license and collaboration agreement, which became effective in August 2007, we granted Roche a non-exclusive licensebusiness, please read Note 3, Significant Agreements, to our intellectual property, including delivery-related intellectual property existing asconsolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of the date of the license and collaboration agreement, to develop and commercialize therapeutic products that function through RNAi, subject to our existing contractual obligations to third parties. In October 2011, Arrowhead acquired certain RNA therapeutics assets from Roche, including our license and collaboration agreement, and now owns all of the rights and obligations of Roche under the license and collaboration agreement. The license is initially limited to four therapeutic areas.this annual report on Form 10-K.

Roche paid us $273.5 million in upfront cash payments. In addition, for each RNAi therapeutic product developed by Arrowhead, its affiliates or sublicensees under the collaboration agreement, we are entitled to receive milestone payments upon achievement of specified development, regulatory and commercialization events, totaling up to an aggregate of $100.0 million per therapeutic target, together with a single-digit percentage royalty payment based on worldwide annual net sales, if any. The potential future milestone payments for each therapeutic target include up to $17.5 million for the achievement of specified development milestones, up to $62.5 million for the achievement of specified regulatory milestones and up to $20.0 million for the achievement of specified commercialization milestones. During 2014, we received a $1.0 million milestone payment from Arrowhead upon the achievement of a specified pre-clinical event for a licensed product. Due to the uncertainty of pharmaceutical development and the high historical failure rates generally associated with drug development, we may not receive any additional milestone payments or any royalty payments from Arrowhead.

The term of the license and collaboration agreement generally ends upon the later of ten years from the first commercial sale of a licensed product and the expiration of the last-to-expire patent covering a licensed product. We estimate that our fundamental RNAi patents covered under the license and collaboration agreement will expire both in and outside the United States generally between 2016 and 2025, subject to any potential patent term extensions and/or supplemental protection certificates extending such term extensions in countries where such extensions may become available. Arrowhead may terminate the license and collaboration agreement, on a licensed product-by-licensed product, licensed patent-by-licensed patent, and country-by-country basis, upon 180-days’ prior written notice to us, but is required to continue to make milestone and royalty payments to us if any royalties were payable on net sales of a terminated licensed product during the previous 12 months. The license and collaboration agreement may also be terminated by either party in the event the other party fails to cure a material breach under the license and collaboration agreement.

Other Strategic License Agreements.

Ionis Pharmaceuticals, Inc. (formerly Isis Pharmaceuticals, Inc.).Isis.    In January 2015, we and IsisIonis Pharmaceuticals, Inc., or Ionis, entered into a second amended and restated strategic collaboration and license agreement.agreement, which we further amended in July 2015. The 2015 IsisIonis agreement provides for certain new exclusive target cross-licenses of intellectual property on foureight disease targets, providing each company with exclusive RNA therapeutic license rights for twofour programs, and extends the parties’ existing non-exclusive technology cross-license, which was originally entered into in 2004 and was amended and restated in 2009, through April 2019.

Pursuant to the 2015 Isis agreement, Isis granted to us an exclusive, low single-digit royalty-bearing license to its chemistry, motif, mechanism and target-specific intellectual property for oligonucleotide therapeutics against two targets: antithrombin and aminolevulinic acid synthase-1. In exchange, we granted to Isis an exclusive, low single-digit royalty-bearing license to our chemistry, motif, mechanism and target-specific intellectual property for oligonucleotide therapeutics against two targets: Factor XI and apolipoprotein (a).

In addition, under the 2015 Isis agreement, the parties agreed to extend the existing non-exclusive technology cross-license through April 2019. Specifically, Isis granted us a low single-digit royalty-bearing, non-exclusive license to new platform technology arising from May 2014 through April 2019 for double-stranded RNAi therapeutics. In turn, we granted Isis a low single-digit royalty-bearing, non-exclusive license to new platform technology arising from May 2014 through April 2019 for single-stranded antisense therapeutics. This broad, non-exclusive cross-license includes chemistry, motif and mechanism patents, but excludes patent claims on formulations, manufacturing and specific targets.

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Under the original 2004 agreement, IsisIonis licensed to us its patent estate related to antisense motifs and mechanisms and oligonucleotide chemistry for double-stranded RNAi products in exchange for a previously disclosed technology access fee, participation in fees for our partnering programs and future milestone and royalty payments from us for programs that incorporate Isis’ intellectual property. We have the right to use Isis’ intellectual property in our development programs or in collaborations and Isis agreed not to grant licenses under these patents to any other organization for the discovery, development and commercialization of double-stranded RNA products designed to work through an RNAi mechanism, except in the context of a collaboration in which Isis plays an active role.

products.  In turn, under the original 2004 agreement, we non-exclusively licensed to IsisIonis our patent estate relating to antisense motifs and mechanisms and oligonucleotide chemistry to research, develop and commercialize single-stranded antisense therapeutics, single stranded RNAi therapeutics and to research double-stranded RNAi compounds. IsisIonis also received a license to develop and commercialize double-stranded RNAi drugs targeting a limited number of therapeutic targets on a non-exclusive basis. We granted these licenses for RNAi therapeutics in exchange for option fees, and future milestone and royalty payments from Isis for RNAi programs that incorporate certain of our intellectual property.

In August 2012, we and Isis amended the agreement to provide certain terms for the discovery, development and commercialization of double-stranded RNA products by us or our sublicensees in the field of agriculture.

As set forth inFor more information regarding the 2015 IsisIonis agreement, under the original 2004 agreement, we agreedincluding its ongoing financial and accounting impact on our business, please read Note 3, Significant Agreements, to pay Isis milestone payments, totaling up to approximately $3.4 million, upon the occurrenceour consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of specified development and regulatory events, and low single-digit royaltiesthis annual report on sales, if any, for each product that we or a collaborator develop using Isis intellectual property. In addition, we agreed to pay to Isis a percentage of specified fees from strategic collaborations we may enter into that include access to Isis’ intellectual property.

Isis has the right to elect up to ten non-exclusive target licenses under the agreement and has the right to purchase one additional non-exclusive target per year during the term of the collaboration. Isis agreed to pay us, per therapeutic target, a license fee of $0.5 million, milestone payments for double-stranded RNAi products totaling approximately $3.4 million, payable upon the occurrence of specified development and regulatory events, and low single-digit royalties on sales, if any, for each double-stranded RNAi or single-stranded RNAi product developed by Isis or a collaborator that utilizes our intellectual property. Due to the uncertainty of pharmaceutical development and the high historical failure rates generally associated with drug development, we may not receive any milestone or royalty payments from Isis.

The term of 2015 Isis agreement generally ends upon the expiration of the last-to-expire patent licensed thereunder, whether such patent is a patent licensed by us to Isis, or vice versa. Either party may terminate the 2015 Isis agreement on 90 days’ prior written notice if the other party materially breaches the agreement and fails to cure the breach within the 90-day notice period and no substantial steps have otherwise been taken to cure the breach, provided, however, that neither party may terminate licenses granted to the other party to the extent necessary to develop or sell products that have at least reached investigational new drug-enabling studies (except for a party’s uncured failure of its payment obligations). Either party may also terminate the agreement in the event the other party undergoes specified bankruptcy events.

Novartis.    In the second half of 2005, we entered into a series of transactions with Novartis, which included a stock purchase agreement, an investor rights agreement and a research collaboration and license agreement. In October 2010, the research program under the collaboration and license agreement was substantially completed in accordance with the terms of such agreement, subject to certain surviving rights and obligations of the parties. Novartis made an upfront payment of $10.0 million to us in October 2005, partly to reimburse prior costs incurred by us to developin vivoRNAi technology. We also received research funding and development milestone payments from Novartis.Form 10-K.

In September 2010, Novartis exercised its right under the collaboration and license agreement to select 31 designated gene targets, for which Novartis has exclusive rights to discover, develop and commercialize RNAi therapeutic products using our intellectual property and technology, including delivery-related intellectual

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property and related technology. Novartis’ right of first offer with respect to an exclusive license for additional targets has terminated. Under the terms of the collaboration and license agreement, for any RNAi therapeutic products Novartis develops against its selected targets, we are entitled to receive milestone payments upon achievement of certain specified development and annual net sales events, up to an aggregate of $75.0 million per therapeutic product, as well as royalties on annual net sales of any such product. Due to the uncertainty of pharmaceutical development and the high historical failure rates generally associated with drug development, we may not receive any additional milestone payments or any royalty payments from Novartis.

During 2014, Novartis publically indicated that they no longer intend to invest in the development of certain RNAi therapeutics and intend to divest certain of their RNAi assets. Novartis has the right to assign our collaboration and license agreement to athird-party that acquires substantially all of its assets relating to RNAi.

Intellectual Property Licenses

In December 2002, we entered into a co-exclusive license with Max Planck Innovation GmbH (formerly known as Garching Innovation GmbH), or Max Planck Innovation, for the worldwide rights to use and sublicense certain patented technology to develop and commercialize therapeutic products and related applications. We also obtained the rights to use, without the right to sublicense, the technology for all diagnostic uses other than for the purposes of therapeutic monitoring. We were also given the right to acquire the remaining 50%50 percent exclusive rights, which right we exercised upon our acquisition of Ribopharma AG in July 2003. In June 2005, we entered into an amendment to our agreement with Max Planck Innovation that secured our exclusivity to use and sublicense certain patented technology to develop and commercialize therapeutic products and related applications.

We are not obligated to pay any development or sales milestone payments to Max Planck Innovation, however, we will be required to pay Max Planck Innovation future single-digit royalties on net sales of all therapeutic and prophylactic products developed with the technology, if any.

Our agreements with Max Planck Innovation generally remain in effect until the expiration of the last-to-expire patent licensed thereunder. We estimate that the principal issued patents covered under the Max Planck Innovation agreements will expire both in and outside the United States during 2021, subject to any potential patent term extensions, restoration and/or supplemental protection certificates extending such term extensions in countries where such extensions may become available. We may terminate the agreements without cause with six months’ prior notice to Max Planck Innovation, and Max Planck Innovation may terminate the agreements in the event that we materially breach our obligations thereunder. Max Planck Innovation also has the right to terminate the agreements in the event that we, independently or through a third party, attack the validity of any of the licensed patents.

Delivery-Related License Agreements

Arbutus.Tekmira.    In November 2012, we, TPCArbutus Biopharma Corporation, or ABC (formerly Tekmira Pharmaceuticals Corporation), and Protiva Biotherapeutics, Inc., or Protiva, a wholly owned subsidiary of ABC, and together with ABC, referred to as Arbutus, agreed to restructure our existing contractual relationship. In connection with this restructuring, the parties entered into a cross-license agreement and agreed to terminate certainthat superseded the prior agreements, including: the May 2008 amended and restated license and collaboration between us and TPC, the May 2008 amended and restated cross-license agreement between us and Protiva, and the January 2009 manufacturing agreement between us and TPC.agreements among us.

Under the 2012 cross-license agreement, the parties consolidated certain intellectual property related to LNP technology for the systemic delivery of RNAi therapeutics. Specifically, certain patents and patent applications, including the MC3 lipid family used with patisiran, were assigned by us to TPC.ABC. We retain rights to use this intellectual property for the research, development and commercialization of RNAi therapeutic products, including the rights to sublicense this intellectual property on a product-by-product basis. TekmiraArbutus has also granted us a worldwide license to its LNP technology for the research, development and commercialization of LNP-based RNAi therapeutics, which license shall be exclusive for up to eight targets designated by us, and otherwise shall be non-exclusive. We have the right to sublicense on a product-by-product basis.

In addition, we elected to buy out our manufacturing obligations to TPCABC with respect to our LNP-based pipeline programs. Pursuant to the terms of the 2012 cross-license agreement, weWe made a one-time payment of

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$30.0 $30.0 million to TPCABC for the termination of, and our release from, all of our obligations under the manufacturing agreement, including without limitation the obligations to obtain materials and/or services from TPC.agreement. We also have the right to manufacture and have manufactured our LNP-based RNAi therapeutics, which right may be sublicensed to our collaborators.

Further, as part of this restructuring, we elected to buy-down certain future potential milestone and royalty payments due to Tekmira for certain of our RNAi therapeutics, formulated using LNP technology. Specifically, pursuant to the 2012 cross-license agreement, we made a one-time payment of $35.0 million to TPC,ABC, which amount constitutedincluded a license termination payment, for the termination of the 2008 license agreements with TPC and Protiva and the parties’ rights and obligations thereunder, as well as the buy-down of certain milestone payments and the significant reduction of royalty rates for ALN-VSP, ALN-PCS02 and patisiran. As a result of this buy-down, future royalty rates for thesecertain LNP-based products, are now further reduced from the low single-digit royalties due on other products, as described below.including patisiran. In addition, we agreed to pay TPCABC an aggregate of $10.0 million in contingent milestone payments related to advancement of ALN-VSP and patisiran, which representrepresenting the only potential milestones due to Tekmiraremaining milestone obligations for ALN-VSP, ALN-PCS02 and patisiran.these products. In December 2013, we paid to TPCABC $5.0 million in connection with the initiation of our APOLLO Phase 3 clinical trial for patisiran, fulfilling one of these milestone obligations. With respect to the second $5.0 million milestone, in August 2013, we initiated binding arbitration proceedings to resolve a disagreement with TPCABC regarding the achievement by TPCABC of this milestone under our cross-license agreement relating to the manufacture of ALN-VSP clinical trial material for use in China. We currently expect that the Tekmira arbitration hearing will be heldprevailed in the second quarter of 2015.

Consistent with the prior license agreements, under the 2012 cross-license agreement, we are obligatedarbitration proceedings in March 2016 and were not required to pay TPC up to an aggregate of $16.0 million inthe second milestone payments for any future RNAi therapeutic formulated using Tekmira LNP technology, excluding ALN-VSP, ALN-PCS02 and patisiran, together with low single-digit royalty payments on annual product sales, if any.at that time.

Under the 2012 cross-license Agreement, Tekmira maintains the threeagreement, Arbutus has one exclusive and five non-exclusive licenses previously granted by us under the prior license agreements to research, develop and commercialize RNAi therapeutics directed to up to eightsix gene targets.  In addition, we granted Tekmira a non-exclusive license forAs of November 12, 2017, Arbutus’ right to select up to two additional geneexclusive targets on the same terms and conditions as the prior non-exclusive licenses. Tekmira also acquired from Acuitas its existing options for threeup to five additional non-exclusive licenses, which were included under the 2012 cross-license agreement. Tekmiratargets expired. Arbutus may sublicense theseits rights on a product-by-product basis. We waived our right under the prior license agreements to opt-in to the Tekmira research program directed to polo-like kinase 1, or PLK1. Under the 2012 cross-license agreement, we are eligible to receive from TekmiraArbutus up to an aggregate of $8.5 million in milestone payments for RNAi therapeutics directed to nineeach of four of the targets for which we have granted licenses to Tekmira,Arbutus, together with single-digit royalties on annual product sales, if any, of RNAi therapeutic products directed to all thirteensix of the targets for which we have granted licenses to Tekmira.Arbutus. Due to the uncertainty of pharmaceutical development and the high historical failure rates generally associated with drug development, we may not receive any additional milestone payments or any royalty payments from Tekmira.Arbutus.

The term of the 2012 cross-license agreement generally ends upon the expiration of the last-to-expire royalty term. Royalties are payable on a product-by-product and country-by-country basis commencing on the first commercial sale of a product in a country and continuing during any period in which (a) in the case of us, a valid claim within the TekmiraArbutus Royalty-Bearing Patents (as defined in the 2012 cross-license agreement) covers our applicable product in such country of sale, or (b) in the case of TekmiraArbutus products, a valid claim within our patents covers the applicable TekmiraArbutus product in such country of sale. We estimate that our fundamental RNAi patents covered under the 2012 cross-license agreement will expire both in and outside the United States generally between 2019 and 2021, and that the TekmiraArbutus LNP patents covered under the 2012 cross-license agreement will expire both in and outside the United States generally between 2020 and 2030, subject in each case to any potential patent term extensions and/or supplemental protection certificates extending such term extensions in countries where such extensions may become available. Either party may terminate a license it granted to the other in the event that the other party fails to cure a material breach of its obligations relating to that license. Furthermore, either party may terminate the 2012 cross-license agreement in the event the other

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party fails to cure a material breach of an obligation under the agreement. In addition, either party may terminate the 2012 cross-license agreement upon patent-related challenges by the other party.

UBC and Acuitas.In July 2009, we entered into a research agreement with The University of British Columbia, or UBC, and Acuitas Therapeutics Inc., or Acuitas (formerly AlCana Technologies, Inc.), that was focused on the discovery of novel lipids, such as the MC3 lipid, which is employed in patisiran. Pursuant to the terms of the research agreement, we funded collaborative research through July 2012, which was conducted by our scientists, together with scientists at UBC and Acuitas. Under the research agreement, UBC and Acuitas are eligible to receive up to an aggregate of $1.3 million in milestone payments from us for each licensed product (as defined in the research agreement) directed to a particular target (as defined in the research agreement), together with single-digit royalty payments on annual product sales, if any.

Concurrent with the execution of the research agreement, we also entered into a supplemental agreement with TPC,ABC, Protiva, UBC and Acuitas, which contains additional terms regarding the intellectual property rights arising out of the research agreement. In connection with 2012 cross-license agreement with TekmiraArbutus described above, we and TekmiraArbutus agreed to supersede the rights and obligations under the supplemental agreement as between ourselves, with the rights and obligations set forth in the 2012 cross-license agreement.

microRNA Therapeutics

Regulus.    In September 2007, we and Isis established Regulus, a company focused on the discovery, development and commercialization of microRNA therapeutics. Regulus leverages our and Isis’ technologies, know-how and intellectual property relating to microRNA therapeutics.

Regulus, which initially was established as a limited liability company, converted to a C corporation as of January 2, 2009 and changed its name to Regulus Therapeutics Inc. In consideration for our and Isis’ initial interests in Regulus, we and Isis each granted Regulus exclusive licenses to our intellectual property for certain microRNA therapeutics as well as certain patents in the microRNA field. Regulus operates as an independent company with a separate board of directors, scientific advisory board and management team. In October 2012, Regulus completed an underwritten initial public offering. Currently, we own approximately 12% of Regulus’ outstanding common stock.

Regulus is exploring therapeutic opportunities that arise from microRNA dysregulation. Since microRNAs are believed to regulate broad networks of genes and biological pathways, microRNA therapeutics define a new and potentially high-impact strategy to target multiple nodes on disease pathways. microRNAs are small non-coding RNAs that regulate the expression of other genes. More than 500 microRNAs have been identified to date in humans, each of which is believed to interact with a specific set of genes that control key aspects of cell biology. Since microRNAs may act as master regulators of the genome and are often found to be dysregulated in disease, microRNAs potentially represent an exciting new platform for drug discovery and development. Regulus is advancing microRNA therapeutics in several areas including oncology, fibrosis, hepatitis C virus and metabolic diseases.

Regulus has entered into a number of strategic alliances with leading pharmaceutical companies, including Sanofi, Biogen Idec and AstraZeneca PLC. Each of Alnylam and Isis is entitled to receive specified sublicense income in connection with certain collaborative agreements entered into by Regulus, as well as royalties on net sales, if any, of certain products developed by Regulus or its collaborators, in each case subject to the terms and conditions of the license and collaboration agreement among Regulus, Isis and Alnylam.

Patents and Proprietary Rights

We have devoted considerable effort and resources to establish what we believe to be a strong intellectual property position relevant to RNAi therapeutic products and delivery technologies. In this regard, we have amassed a portfolio of patents, patent applications and other intellectual property covering:

We believe that no other company possesses a portfolio of such broad and exclusive rights to the patents and patent applications required for the commercialization of RNAi therapeutics. Our intellectual property estate for RNAi therapeutics includes over 2,0003,800 active cases and over 1,1001,700 granted or issued patents, of which over 400600 are issued or granted in the United States, the EU, including by the European Patent Office, or EPO, and Japan. Given the importance of our intellectual property portfolio to our business operations, we intend to vigorously enforce our rights and defend against challenges that have arisen or may arise in this area.

Intellectual Property Related to Fundamental Aspects and Uses of siRNA and RNAi-related Mechanisms

In this category, we include United States and certain foreign patents and patent applications that claim key aspects of siRNA architecture and RNAi-related mechanisms. Specifically included are patents and patent applications covering targeted cleavage of mRNA directed by RNA-like oligonucleotides and double-stranded RNAs of particular lengths and particular structural features, such as blunt and/or overhanging ends, as well as various types and patterns of chemical modifications. Our strategy has been to secure exclusive rights where possible and appropriate to key patents and patent applications that we believe cover fundamental aspects of RNAi.

The following table lists patents and/or patent applications to which we have secured rights that we regard as being fundamental for the use of siRNAs as therapeutics.

We believe that we have a strong portfolio of broad rights to fundamental RNAi patents and patent applications. Many of these rights are exclusive, which we believe prevents potential competitors from commercializing products in the field of RNAi without taking a license from us. In securing these rights, we have focused on obtaining the strongest rights for those intellectual property assets we believe will be most important in providing competitive advantage with respect to RNAi therapeutic products.

We believe that the Crooke patent series, issued in several countries around the world, covers the use of modified oligonucleotides to achieve enzyme-mediated cleavage of a target mRNA. We have obtained rights to the Crooke patents for use with double-stranded RNA products, through a license agreement with Isis.Ionis. Under the terms of our agreement, IsisIonis agreed not to grant licenses under these patents to any other organization for double-stranded RNA products designed to work through an RNAi mechanism, except in the context of a collaboration in which IsisIonis plays an active role. Our agreement with IsisIonis was amended and restated in January 2015 to, among other things, extend the license for an additional five years, through April 2019.

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Through our acquisition of Ribopharma AG, now known as Alnylam Europe AG, we own the entire Kreutzer-Limmer patent portfolio, which includes pending applications in the United States and many countries worldwide.

The Glover patent series has resulted in several patent grants, including in Europe (EP 1230375). We have an exclusive license to the Glover patent for therapeutic uses from Cancer Research Technology Limited, or CRT.

The Tuschl patent applications filedowned by Whitehead Institute for Biomedical Research, or Whitehead, the Massachusetts Institute of Technology, or MIT, UMass and Max Planck Gesellschaft zur Foerderung der Wissenschaften e.V. on the invention by Dr. Tuschl and his colleagues, which we call the Tuschl I patent series, cover compositions and methods important for RNAi discovery. We are the exclusive licensee of the ownership interests of the Max Planck Gesellschaft zur Foerderung der Wissenschaften e.V., MIT and Whitehead in the Tuschl I patent series for RNAi therapeutics. The Tuschl patent applications filedowned by Max Planck Gesellschaft zur Foerderung der Wissenschaften e.V., Whitehead, MIT and UMass on the invention by Dr. Tuschl and his colleagues, which we call the Tuschl II patent series, cover what we believe are key structural features of siRNAs. Specifically, the Tuschl II patents and patent applications include claims directed to synthetic siRNAs and the use of chemical modifications to stabilize siRNAs. We have obtained an exclusive license to claims in the Tuschl II patent series uniquely covering the use of RNAi for therapeutic purposes. Collectively, the Tuschl I and II patent families cover a wide range of double-stranded RNA molecules between 19-52 nucleotides in length, including those unmodified and those comprising chemical modifications. Examples of those chemical modifications encompassed by the Tuschl claims include those modifications made in the ribose ring, e.g., at the 2’ position such as 2’-OMe, 2’-F or modifications such as those found in locked and unlocked (acyclic) nucleotides.

The Fire and Mello patent owned by the Carnegie Institution of Washington covers the use of double-stranded RNAs to induce RNAi. The Carnegie Institution has made this patent broadly available for licensing and we, like many companies, have taken a non-exclusive license to the patent for therapeutic purposes. We believe, however, that the claims of the Fire and Mello patent do not cover the structural features of double-stranded RNAs that are important for the biological activity of siRNAs in mammalian cells. We believe that these specific features are the subjects of the Crooke, Kreutzer-Limmer, Glover and Tuschl II patents and patent applications for which we have secured exclusive rights.

The other pending patent applications listed in the table above either provide further coverage for structural features of siRNAs or relate to the use of siRNAs in mammalian cells. For some of these, we have exclusive rights, and for others, we have non-exclusive rights. In addition, in December 2008, we acquired the intellectual property assets of Nucleonics, Inc., a privately held biotechnology company. This acquisition included over 100 active patent filings, including 15 patents that have been granted worldwide, of which five have been granted in the United States and Europe. With this acquisition, we obtained patents and patent applications with early priority dates, notably the “Li & Kirby,” “Pachuk I” and “Giordano” patent families, that cover broad structural features of RNAi therapeutics, thus extending the breadth of our fundamental intellectual property.

Intellectual Property Related to Chemical Modifications

Our amended and restated collaboration and license agreement with Isis providesIonis provided us with rights to practice the inventions covered by over 200 issued patents worldwide, as well as rights based on future chemistry patent applications through April 2014 for use with double-stranded RNA products. In January 2015, we entered into a second amended and restated agreement with IsisIonis to extend our rights to future chemistry applications through April 2019. These patents will expire both in and outside the United States generally between 2015 and 2035, subject to any potential patent term extensions and/or supplemental protection certificates extending such term extensions in countries where such extensions may become available. These inventions cover chemical modifications we may wish to incorporate into double-stranded RNA therapeutic products designed to work through an RNAi mechanism. Under the terms of our agreement, IsisIonis agreed not to grant licenses under these patents to any other organization for double-stranded RNA products designed to work through an RNAi mechanism, except in the context of a collaboration in which IsisIonis plays an active role.

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In addition to licensing these intellectual property rights from Isis,Ionis, we are also working to develop our own proprietary chemical modifications that may be incorporated into siRNAs to endow them with drug-like properties. We have filed a large number of patent applications relating to these novel and proprietary chemical modifications.

With the combination of the technology we have licensed from Isis,Ionis, various patents in the Tuschl II patent series and our own patent application filings, we possess issued claims that cover methods of making siRNAs that incorporate any of various chemical modifications, including the use of phosphorothioates, 2’-O-methyl and/or 2’-fluoro modifications and modifications such as those found in locked and unlocked (acyclic) nucleotides. These modifications are believed to be important for achieving “drug-like” properties for RNAi therapeutics. We hold exclusive worldwide rights to these claims for RNAi therapeutics.

In addition to the above, in March 2014, we acquired the RNAi assets from Merck, which included intellectual property developed at Sirna and Merck. The acquired patent portfolio includes the “McSwiggen” patent families with issued and pending claims covering highly chemically modified oligonucleotide compositions, both single- and double-stranded and independent of 5’ and 3’ architecture. A total of tenSeveral patents have granted in the United States with claims directed to various combinations of chemical modifications to double-stranded RNA of between 18 and 24 nucleotides. Notably, U.S. 8,273,866 was granted in September 2012 with significant patent term adjustment extending the expiration of this patent to mid-2028. EP423406 was granted in September 2010 with claims directed to double-stranded RNA of between 18 and 24 nucleotides with ten or more chemical modifications on the pyrimidine residues of the sense and/or antisense strand. As indicated in the chart above, four additional EP patents have granted with claims to various combinations of chemically modified compositions comprising double-stranded RNA of between 18 and 24 nucleotides and methods of making and using such combinations. In November 2015, U.S. 9,181,551 granted with claims directed to highly modified double-stranded RNA molecules comprising a ligand, with dependent claims wherein the ligand is chosen from a ligand for a cellular receptor, a protein localization sequence, an antibody, a nucleic acid aptamer, a vitamin, a co-factor, a phospholipid, a cholesterol, a polyamine, a galactose, a galactosamine, a folate, an N-acetyl-galactosamine (wherein the N-acetylgalactosamine is a mono-antennary, bi-antennary or a tri-antennary galactosamine). Additional dependent claims are directed to highly modified double-stranded RNA with modified nucleotides, including but not limited to unlocked (acyclic) and locked nucleotides. In addition, in August 2017 the United States Patent and Trademark Office, or USPTO, granted U.S. Patent No. 9,732,344 with claims directed to single-stranded antisense polynucleotide molecules of 18-20 nucleotides, comprising 10 or more phosphorothioates and 10 or more modified pyrimidine molecules.  

Intellectual Property Related to the Delivery of siRNAs to Cells

We also pursue internal research and collaborative approaches regarding the delivery of siRNAs to mammalian cells. These approaches include exploring technology that may allow delivery of siRNAs to cells through the use of cholesterol and carbohydrate conjugation, cationic lipids, peptide and antibody-based targeting, and polymer conjugations. Our collaborative efforts have included working with academic and corporate third parties to examine specific embodiments of these various approaches to delivery of siRNAs to appropriate cell tissue, and in-licensing and/or acquiring the most promising technology.

In September 2014, the United States Patent and Trademark Office, or USPTO granted U.S. Patent No. 8,828,956 with claims directed to compositions including those comprising a modified RNA agent linked to a biantennary or triantennary ligand. Specifically, the granted patent includes claims that broadly cover single-strandedsingle- or double-stranded, chemically modified RNA therapeuticstherapeutic molecules conjugated with a GalNAc ligand independent of length, sequence or disease target.

The acquisition of Sirna also accelerated our overall efforts to develop and commercialize siRNA delivery technologies, including GalNAc-siRNA and GalNAc-single stranded polynucleotide conjugate technology. As part of the Sirna acquisition, we obtained several patent families directed to various conjugate technologies including “tetra-GalNAc” compositions and methods. The tetra-GalNAc cases are pending worldwide and will expire May 1, 2033. Also included were patent families directed to novel lipid compositions and formulations that are pending worldwide and set to expire May 31, 2031.

In addition to the Sirna delivery technology, we have a license from UBC and TekmiraArbutus in the field of RNAi therapeutics to intellectual property covering cationic liposomes and their use to deliver nucleic acid to cells. The issued United States patents and foreign counterparts, including the Semple (U.S. Patent No 6,858,225) and Wheeler (U.S. Patent No. 6,815,432) patents, cover compositions, methods of making and methods of using cationic liposomes to deliver agents, such as nucleic acid molecules, to cells. These patents will expire both in and outside the United States on October 30, 2017 and June 7, 2015, respectively, subject to any potential patent term extensions and/or supplemental protection certificates extending such term extensions in countries where such extensions may become available.

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In addition, in April 2012, the USPTO granted U.S. Patent No. 8,158,601, covering composition of matter and formulations of the MC3 lipid, as well as methods of using these compositions and formulations. MC3 is being utilized in our patisiran development program. We assigned this patent, amongst other patents and patent applications relating to lipids and LNP technology, to TekmiraArbutus in connection with our November 2012 restructuring and cross-license agreement. We retain rights to use this intellectual property for the research, development and commercialization of RNAi therapeutic products, including the rights to sublicense this intellectual property on a product-by-product basis. A description of our 2012 restructuring and cross-license agreement with TekmiraArbutus is set forth above under “Strategic Alliances — Other Strategic License Agreements — Delivery-Related Licenses and CollaborationsLicense Agreements — Tekmira.Arbutus.”

Intellectual Property Related to siRNAs Directed to Specific Targets

We have filed a number of patent applications claiming specific siRNAs directed to various gene targets that correlate to specific diseases. While there may be a significant number of competing applications filed by other organizations claiming siRNAs to treat the same gene target, we were among the first companies to focus and file on RNAi therapeutics, and thus, we believe that a number of our patent applications may predate competing applications that others may have filed. Reflecting this, in August 2005, the EPO granted a broad patent, which we call the Kreutzer-Limmer II patent, with 103 allowed claims on therapeutic compositions, methods and uses comprising siRNAs that are complementary to mRNA sequences in over 125 disease target genes. In July 2009, the EPO ruled in our favor in an opposition proceeding related to the Kreutzer-Limmer II patent. The decision had been appealed by Sirna and was subsequently withdrawn upon our acquisition of Sirna. No further appeal before the EPO is available. The Kreutzer-Limmer II patent will expire on January 9, 2022, subject to any potential patent term extensions and/or supplemental protection certificates extending such term extensions in countries where such extensions may become available. Some of these claimed gene targets are being pursued by our development and pre-clinical programs, such as those expressed by viral pathogens including RSVrespiratory syncytial virus and influenza virus. In addition, the claimed targets include oncogenes, cytokines, cell adhesion receptors, angiogenesis targets, apoptosis and cell cycle targets, and additional viral disease targets, such as hepatitis C virus and HIV. The Kreutzer-Limmer II patent series is pending in the United States and many foreign countries. Granted U.S. patent 8,618,277 obtained in the Sirna acquisition and set to expire on February 20, 2023, contains claims directed to a highly chemically modified double-stranded siRNA of between 18-24 nucleotides specifically targeting the hepatitis B virus in a sequence independent manner. Moreover, a patent in the Tuschl II patent series, U.S. Patent No. 7,078,196, claims methods of preparing siRNAs that mediate cleavage of an mRNA in mammalian cells and, therefore, covers methods of making siRNAs directed toward any and all target genes. We hold exclusive worldwide rights to these claims for RNAi therapeutics.

In 2016, we were granted U.S. Patent Nos. 9,370,581, 9,370,582 and 9,352,048 containing claims that broadly cover single- or double-stranded RNA therapeutic molecules conjugated with any biantennary or triantennary ligand (including but not limited to GalNAc) independent of length, specifically inhibiting TTR, PCSK9 or hepatitis b virus, respectively, wherein the HBV-specific RNA molecule is fully chemically modified.

In August 2017, we were granted U.S. Patent No. 9,738,899 with claims directed to single-stranded antisense polynucleotide molecules, capable of inhibiting expression of the human transthyretin gene, of 18-20 nucleotides, comprising 10 or more phosphorothioates and 10 or more modified pyrimidine molecules, 2’-deoxy,-O-Methyl, -Fluoro, -methoxyethoxy (MOE), pyrimidines, LNA-pyrimidines or a combination, with or without conjugation to a galactosamine or cholesterol.

Intellectual Property Related to Our Development Candidates

As our development pipeline matures, we have made and plan to continue to make patent filings that claim all aspects of our development candidates, including dose, method of administration and manufacture.

Intellectual Property Challenges

As the field of RNAi therapeutics is maturing, patent applications are being fully processed by national patent offices around the world. There is uncertainty about which patents will issue, and, if they do, as to when, to whom and with what claims. It is likely that there will be significant litigation and other proceedings, such as interference, reexamination,inter partes review, post grantpost-grant review

and opposition proceedings, in various patent offices relating to patent rights in the RNAi field. On September 16, 2012, the America Invents Act went into effect and provided for expanded patent challenge, i.e.,inter partes review and post-grant review. These provide additional opportunities for third parties to challenge our patents. For example, as noted in the table above, various third parties have initiated oppositions to patents in our Kreutzer-Limmer and Tuschl II series in the EPO, as well as in other jurisdictions. We expect that additional oppositions will be filed in the EPO and elsewhere, and other challenges will be raised relating to other patents and patent applications in our portfolio. In many cases, the possibility of appeal exists for either us or our opponents, and it may be years before final,

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unappealable rulings are made with respect to these patents in certain jurisdictions. Given the importance of our intellectual property portfolio to our business operations, we intend to vigorously enforce our rights and defend against challenges that have arisen or may arise in this area. A description of ongoing legal matters relating to certain aspects of our intellectual property portfolio is set forth in Part I, Item 3, “Legal Proceedings,” of this annual report on Form 10-K.

Competition

The pharmaceutical marketplace is extremely competitive, with hundreds of companies competing to discover, develop and market new drugs. We face a broad spectrum of current and potential competitors, ranging from very large, global pharmaceutical companies with significant resources, to other biotechnology companies with resources and expertise comparable to our own, to smaller biotechnology companies with fewer resources and expertise than we have. We believe that for most or all of our drug development programs, there will be one or more competing programs under development at other companies. In many cases, the companies with competing programs will have access to greater resources and expertise than we do and may be more advanced in those programs.

Competition for Our Business in General

The competition we face can be grouped into three broad categories:

We are aware of several other companies that are working to develop RNAi therapeutic products. Some of these companies are seeking, as we are, to develop chemically synthesized siRNAs as drugs. Others are following a gene therapy approach, with the goal of treating patients not with synthetic siRNAs but with synthetic, exogenously-introduced genes designed to produce siRNA-like molecules within cells.

Companies working on chemically synthesized siRNAs include Takeda, Kyowa Hakko Kirin, Marina Biotech, Inc., or Marina, Arrowhead Pharmaceuticals, Inc., or Arrowhead, and its subsidiary, Calando Pharmaceuticals, Inc., or Calando, Quark Pharmaceuticals, Inc., or Quark, Silence Therapeutics plc, Tekmira,or Silence, Arbutus, Sylentis, S.A.U., or Sylentis, Dicerna Pharmaceuticals, Inc., or Dicerna, WAVE Life Sciences Ltd., or WAVE, and Arcturus Therapeutics.Therapeutics, Inc., or Arcturus. Many of these companies have licensed our intellectual property. Benitec Biopharma Ltd., or Benitec, is working on gene therapy approaches to RNAi therapeutics. Companies working on microRNA therapeutics include Regulus Therapeutics, Inc., or Regulus, Rosetta Genomics Ltd., F. Hoffmann-La Roche Ltd, or Roche, through its acquisition in 2014 of Santaris Pharma A/S, miRagen Therapeutics, Inc., Mirna Therapeutics, Inc. and Asuragen, Inc.

Antisense technology uses short, single-stranded, DNA-like molecules to block mRNAs encoding specific proteins. While we believe that RNAi drugs may potentially have significant advantages over antisense oligonucleotides, or ASOs, including greater potency and specificity, others are developing ASO drugs that are currently at a more advanced stage of development than RNAi drugs. For example, IsisIonis has developed theseveral ASO drugs fomivirsen, which was approved by the FDAthat have received regulatory approval. Ionis is also developing antisense drugs using ligand-conjugated GalNAc technology licensed from us, and these drugs have been shown to have increased potency at lower doses in 1998 for the treatment of cytomegalovirus retinitis, but is no longer available in the United States,clinical and mipomersen, which was approved by the FDA for the treatment of patientspre-clinical studies, compared with homozygous familial hypercholesterolemia, or HoFH.antisense drugs that do not use such licensed GalNAc technology.  In addition, a number of other companies have ASO-based product candidates in various stages of pre-clinical and clinical development, including Roche, Celgene Corporation, Akcea Therapeutics, Inc., or Akcea, Antisense Therapeutics, Ltd., WAVE and Sarepta Therapeutics, Inc. Because of their later stage of development, ASOs, rather than siRNAs, may become the preferred technology for drugs that target mRNAs in order to turn off the activity of specific genes.

The competitive landscape continues to expand and we expect that additional companies will initiate programs focused on the development of RNAi therapeutic products using the approaches described above as

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well as potentially new approaches that may result in the more rapid development of RNAi therapeutics or more effective technologies for RNAi drug development or delivery.

Competing Drugs for Our Investigational RNAi Therapeutics in Late Stage Clinical Development

Hereditary ATTR Amyloidosis.TTR-Mediated Amyloidosis (ATTR).    Until recently, organ transplantation was the only treatment option for patients with ATTR. Liver or combined heart/liver transplantations were the only available treatment options for FAP.hATTR amyloidosis. Only a subset of FAP patients with early stage disease qualify for this costly and invasive procedure, which carries significant morbidity and evenmortality. Even following liver transplantation, the disease continues to progress for many patients, presumably due to normalongoing deposition of wild-type TTR being deposited into preexisting fibrils. Moreover,protein. Currently there is a shortageonly one approved drug for ATTR amyloidosis, as well as several investigational drugs in varying stages of donors to provide healthy livers for transplantation. In November 2011, Pfizer received marketing approval fromclinical development. We believe that the EC for tafamidis for the treatment of transthyretin amyloidosis in adult patientsfollowing approved drugs and if approved, drug candidates, could compete with stage 1 symptomatic polyneuropathy to delay peripheral neurologic impairment. Tafamidis is intended to stabilize wild-type and variant TTR, to prevent dissociation of the TTR protein and thereby inhibit the formation of TTR oligomers and amyloid fibrils.patisiran:

Acute Hepatic Porphyrias.The only currently availableapproved treatments for FACacute attacks are aimed at reliefpreparations of symptoms, such as diuretics, or water pills, to treat the swelling of the ankles, one of the symptoms of FAC. For patients with advanced cardiomyopathy (FAC and SSA) heart transplant is a therapeutic option. Again, the scarcity of organs for transplantation, and the mortality, morbidity and cost associated with this procedure render it a realistic option for only a very small number of patients. In December 2013, Pfizer initiated a Phase 3 clinical trial of tafamidis in patients with TTR amyloidosis cardiomyopathy. The study is expected to enroll up to 400 patients and study two dose levels, with a 30-month treatment duration for each patient.

Several drugs are in clinical development for the treatment of ATTR. Researchers at Boston University, in collaboration with the National Institute of Neurological Disorders and Stroke, conducted a Phase 2/3 clinical trial for diflunisal for the treatment of FAP. Diflunisal is a commercially available non-steroidal anti-inflammatory agent that has been found to stabilize TTRin vitro. This clinical trial concluded that the use of diflunisal compared with placebo for two years reduced the rate of progression of neurological impairment and preserved quality of life. As published, the discontinuation rate was high in this clinical trial in both treatment arms (approximately 50% overall) and the majority of patients continued to deteriorate, including patients on diflunisal. Furthermore, the safety profile of this drug and its known adverse effects, particularly on the kidney and heart, could likely limit the potential use of it in this disease.

In addition, Isis, together with its partner GlaxoSmithKline, is developing ISIS-TTR_Rx, an ASO designed to treat patients with FAP. Isis has completed a Phase 1 clinical trial evaluating the safety and activity of six subcutaneous doses of ISIS-TTR_Rx over four weeks in healthy volunteers. Isis reported that in this clinical trial, ISIS-TTR_Rx produced significant reductions of approximately 80% in TTR protein at the highest dose studied. This study reported that ISIS-TTR_Rx was generally well tolerated with no significant adverse events. The occurrence of injection site reactions and flu-like symptoms were reported in patients taking ISIS-TTR_Rx. Isis announced that ISIS-TTR_Rx was granted fast track designation by the FDA for the treatment of patients with FAP. Isis initiated a Phase 2/3 clinical trial in early 2013 that is expected to enroll up to 195 patients, with a treatment duration of 15 months for each patient.

Hemophilia.heme derived from human blood. The global market for treatments of hemophilia and bleeding disorders is valued at more than $9.0 billion. Products on the market include: Factor VIII replacement products marketed by Baxter Healthcare Corporation, Bayer Healthcare Pharmaceuticals, Pfizer and CSL Behring; Factor IX replacement products marketed by Pfizer (Wyeth), Baxter and CSL Behring; a Factor VIIa replacement product marketed by Novo Nordisk; and concentrated products for fibrinogen, FII, FX and FXI deficiencies. In 2014, long-acting factor VIII replacement and factor IX replacement products from Biogen Idec were approved by the FDA. Also in 2014, recombinant porcine Factor VIII was approved by the FDA for the treatment of acquired HA.

A number of products are currently in development for the treatment of hemophilia. Additional long-acting factor therapies will be on the market in the near future, and may extend the time between intravenous doses. For example, Novo Nordisk is developing two long-acting recombinant derivatives for the treatment of HB, both of which are in Phase 3 clinical trials. Baxter is also developing long-acting recombinant factor replacement

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products for the treatment of HB. Bayer is also developing a long-acting recombinant product and Pfizer is developing a recombinant Factor VIIa variant that is in a Phase 1 clinical trial in adults with HA or HB.

A particular segment of people with hemophilia develop neutralizing antibodies to the factors; these are called people with inhibitors. They cannot be given replacement factors VIII or IX since the inhibitor, an antibody, will lead to immediate clearance of any Factor VIII or Factor IX that is administered. Generally speaking, these individuals are monitored for signs of a bleed and then are given recombinant Factor VIIa or FEIBA. FEIBA is an anti-inhibitor coagulant complex from Baxter. It is approved in both the United States and the EU for the treatment of acute bleeds and for prophylactic treatment.

Molecules currently in development may offer new treatments for HA and HB subjects with and without inhibitors. Chugai and Roche are developing a bi-specific antibody (ACE-910) which binds to factors IXa and X and mimics the Factor VIII cofactor function in HA subjects. This product has completed a Phase 1 clinical trial and has been shown to reduce the incidence of bleeding events in people with hemophilia with and without inhibitors. Novo Nordisk is developing Anti-TFPI (NN7415), a monoclonal antibody against a tissue factor pathway inhibitor, for the treatment of HA and HB, currently in Phase 1 clinical trials. Baxter is developing a peptide which also targets a tissue factor pathway inhibitor for the treatment of HA and HB.

A number of companies are actively developing gene therapy products which use a virus to deliver a functional segment of a particular gene into the cells of the subject with hemophilia. In 2013, Biomarin licensed technology from University College London and St. Jude Children’s Research Hospital to develop gene therapy products for the treatment of HA. In 2014, Baxter acquired Chatham Therapeutics, which was developing a gene therapy product for the treatment of HB. In 2014, Bayer partnered with Dimension Therapeutics, or Dimension, to develop a gene therapy product for the treatment of HA. Dimension is also developing a gene therapy product for the treatment of HB.

Complement-Mediated Diseases.    The global market for drugs that specifically target complement-mediated diseases is significant. The only product in this market is eculizumab, a monoclonal antibody developed by Alexion Pharmaceuticals that inhibits the cleavage of the protein complement component 5 (C5) into its components C5a and C5b. In 2007, eculizumab was approved by the FDA and the EC to treat PNH, a hemolytic anemia caused by a deficiency of proteins on the red blood cell membrane that protect the cells from destruction by the complement system. In 2011, eculizumab was approved by the FDA and EC to treat aHUS, a systemic disease cause by chronic uncontrolled activation of the complement system. Eculizumab is also currently being studied in a number of other diseases that are believed to be complement-mediated including: neuromyelitis optica, myasthenia gravis, antibody-mediated rejection and delayed graft function.

A number of products are in development for the treatment of complement-mediated diseases. Swedish Orphan Biovitrium (SOBI) is developing SOBI002, an antibody to inhibit C5. In 2014, the Phase 1 trial for SOBI002 was placed on hold when adverse effects were observed in the study. Shire is conducting Phase 1 trials of a plasma-derived C1 esterase inhibitor for the treatment of PNH and acute neuromyelitis optica that is currently approved for the prevention of hereditary angioedema attacks. Apellis Pharmaceuticals is developing APL-2, a subcutaneously administered analogue of compstatin which inhibits Complement Component C3 (C3). A Phase 1 trial for APL-2 began in October 2014.

Hepatic Porphyrias.    The global market for hepatic porphyrias is less than $150.0 million. This marketAHP is made up of intravenous hemin in the United States and intravenous heme arginate in the EC.EU. Both products are currently manufactured by Recordati S.p.A. Both molecules are human-derived blood products which haveDespite the lack of randomized studies demonstrating clinical efficacy, heme has been shown in case studies to reducehasten recovery from attacks and has been marketed since 1999 in the duration of porphyria attacks.

Several other products are in developmentEU for the treatment of AIP. Theacute attacks of AIP, hereditary coproporphyria and variegate porphyria.

In addition to heme, the AIPGENE consortium, a European collaboration whichthat included industry sponsors UniQureuniQure and Digna Biotech, iswas developing AMT-021, a gene therapy product for the treatment of AIP. In 2014,AIP, but this development program is currently on hold.  We are aware of other companies that have pre-clinical development programs for the consortium released one-year follow-up data on thetreatment of AHPs.    

Hemophilia.AMT-021 which confirmed the safety   The global market for treatments of hemophilia and the successful transduction of the virus. No datableeding disorders is valued at more than $10.0 billion. Products on the observations relatedmarket include: Factor VIII replacement products; Factor IX replacement products; and more recently, factor replacement products with extended half-lives. For the treatment of persons with inhibitors, there is an approved Factor VIIa replacement product and an activated prothrombin complex concentrate.  In addition, new, innovative molecules are currently in development which may offer new treatments for people with hemophilia A and B, with and without inhibitors, including one such molecule that was recently approved for use in persons with hemophilia A with inhibitors in the United States. A number of companies are also actively developing gene therapy products that use virus-like particles to protein expression have been publically disclosed.deliver a functional section of a particular gene into the liver cells of a person with hemophilia.

We believe that the following approved drugs and, if approved, drug candidates, could compete with fitusiran, along with additional approved drugs and drug candidates:

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Hypercholesterolemia.Hypercholesterolemia.     The current standard of care for patients with hypercholesterolemia includes the use of several agents.dietary changes, lifestyle modification and the use of pharmacologic therapy. Front line therapy consists of HMG CoAHMG-CoA reductase inhibitors, commonly known as statins, which block production of cholesterol by the liver and increase clearance of LDL-C from the bloodstream. These include atorvastatin, simvastatin, rosuvastatin and pravastatin. A different class of compounds, which includes ezetimibe and ezetimibe/simvastatin, function by blocking cholesterol uptake from the diet and are utilized on their own or in combination with statins. Aegerion Pharmaceuticals, Inc. is developing lomitapide, an microsomal triglyceride protein, or MTP, inhibitorSeveral anti-PCSK9 antibodies have also been approved for the treatment of dyslipidemia. In December 2012, the FDA approved lomitapide for use in patients with HoFH and in July 2013 lomitapide was approved for HoFHhypercholesterolemia in the EU.

In addition, mipomersen isUnited States and Europe. Other PCSK9-targeted approaches are in development at a lipid-lowering weekly injectable drug targeting apolipoprotein B-100 being developed by Isis in collaboration with Genzyme. In July 2011, Genzyme submitted a marketing authorization application for mipomersen in Europe. In December 2012, the CHMP recommended against approvalnumber of the drug in Europe for familial hypercholesterolemia. In January 2013, the FDA approved mipomersen for the treatment of patients with HoFH.

With regard to future therapies in clinical development, several anti-PCSK9 antibodies have advanced into clinical development, including alirocumab, which is being developed by Regeneron Pharmaceuticals, Inc., in collaboration with Sanofi. Data reported from a Phase 3 clinical trial evaluating alirocumab in 2,341 patients with heterozygous familial hypercholesterolemia or coronary heart disease demonstrated mean reductions in LDL-C from baseline of 61% and showed a statistically significant reduction in a post-hoc analysis of adjudicated major CV events. Numerous other Phase 3 clinical studies demonstrated similar results. In 2012, Regeneron announced the launch of ODYSSEY OUTCOMES, an 18,000 patient Phase 3 clinical trial designed to test the efficacy and safety of REGN727 added to maximal doses of statins in reducing cardiovascular morbidity and mortality in patients with recent acute coronary syndrome, a population at high risk of cardiovascular events despite best contemporary therapy. Regeneron filed an NDA for alirocumab with the FDA in 2014.

Amgen Inc. has also advanced evolocumab, an anti-PCSK9 antibody, through late-stage clinical development. Data reported from the 52-week Phase 3 DESCARTES trial in 905 patients showed that evolocumab reduced LDL-C by 57%. Numerous other phase 3 studies demonstrated similar results. In August 2014, Amgen filed an NDA with the FDA for evolocumab. In September 2014, Amgen filed a marketing application with the EC.companies.

We are also aware of ongoing programs at Pfizerbelieve that the following approved drugs and other companies to develop anti-PCSK9 molecules, and we are aware of several additional similar compounds in advanced pre-clinical development.if approved, drug candidates, could compete with inclisiran:

In addition, Esperion Therapeutics is developing bempedoic acid (ETC-1002), a small molecule drug which is both an ATP citrate lyase inhibitor and an activator of AMP kinase. In a Phase 2 trial in patients with hypercholesterolemia with or without statin intolerance, patients taking ETC-1002 had a 30% reduction inLDL-C compared with baseline. ETC-1002 is in Phase 2b clinical trials.Other Competition

Other Competition

Finally, for many of the diseases that are the subject of our RNAi therapeuticsearly stage clinical, pre-clinical development and discovery RNAi therapeutic programs, there are already drugs on the market or in development. For example, with respect toALN-HBV, oral nucleoside/nucleotide analogues have demonstrated the ability to potently inhibit HBV replication and suppress levels of HBV DNA in patients with HBV and are approved for the treatment of these patients in the United States, Europe and other countries. In addition, a large number of novel agents, including agents using chemically synthesized siRNA, are currently in development for the treatment of patients with HBV. However, notwithstanding the availability of existing drugs or drug candidates, we believe there currently exists sufficient unmet medical need to warrant the advancement of our investigational RNAi therapeutic programs.

Regulatory Matters

U.S. Regulatory Considerations

The research, testing, manufacture and marketing of drug products and their delivery systems are extensively regulated in the United States and the rest of the world. In the United States, drugs are subject to

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rigorous regulation by the FDA. The Federal Food, Drug, and Cosmetic Act, or FDCA, and other federal and state statutes and regulations govern, among other things, the research, development, testing, approval, manufacture, storage, record keeping, reporting, packaging, labeling, promotion and advertising, marketing and distribution of pharmaceuticaldrug products. Failure to comply with the applicable regulatory requirements may subject a company to a variety of administrative or judicially-imposed sanctions and the inability to obtain or maintain required approvals to test or market drug products. These sanctions could include, among other things, warning letters, product recalls, product seizures, total or partial suspension of production or distribution, clinical holds, injunctions, fines, civil penalties or criminal prosecution.

The steps ordinarily required before a new pharmaceuticaldrug product may be marketed in the United States include nonclinical laboratory tests, animal tests and formulation studies, the submission to the FDA of an investigational new drug, or IND, application, which must become effective prior to commencement of clinical testing, approval by an institutional review board, or IRB, at each clinical site before each trial may be initiated, completion of adequate and well-controlled clinical trials to establish that the drug product is safe and effective for the indication for which FDA approval is sought, submission to the FDA of an NDA review and recommendation by an advisory committee of independent experts (particularly for new chemical entities), satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the product is produced to assess compliance with current good manufacturing practice, or cGMP, requirements, satisfactory completion of an FDA inspection of the major investigational sites to ensure data integrity and assess compliance with good clinical practice, or GCP, requirements and FDA review and approval of the NDA. Satisfaction of FDA pre-market approval requirements typically takes several years, but may vary substantially depending upon the complexity of the product and the nature of the disease. Government regulation may delay or prevent marketing of potential products for a considerable period of time and impose costly procedures on a company’s activities. Success in early stage clinical trials does not necessarily assure success in later stage clinical trials. Data obtained from clinical activities, including but not limited to the data derived from our clinical trials for patisiran, revusiran, ALN-AT3fitusiran, givosiran and ALN-PCSsc, isinclisiran, are not always conclusive and may be subject to alternative interpretations that could delay, limit or even prevent regulatory approval. Even if a product receives regulatory approval, later discovery of previously unknown problems with a product, including new safety risks, may result in restrictions on the product or even complete withdrawal of the product from the market.

Nonclinical Tests and Clinical Trials.

Nonclinical tests include laboratory evaluation of product chemistry and formulation, as well as animal testing to assess the potential safety and efficacy of the product. The conduct of the nonclinical tests and formulation of compounds for testing must comply with federal regulations and requirements. The results of nonclinical testing are submitted to the FDA as part of an IND, together with chemistry, manufacturing and controls, or CMC, information, analytical and stability data, a proposed clinical trial protocol and other information.

A 30-day waiting period after the filing of  Clinical testing in humans may not commence until an IND is required priorin effect.

An IND becomes effective 30 days after receipt by the FDA unless the FDA notifies the sponsor that the proposed investigation(s) are subject to such application becoming effective and the commencement ofa clinical testing in humans.hold. If the FDA has not commented on, or questioned,imposes a clinical hold, the application during this 30-day waiting period, clinical trials may begin. If the FDA has comments or questions, theseFDA’s concerns must be resolved prior to the satisfaction of the FDA prior to commencement of clinical trials. The IND review process can result in substantial delay and expense. We, an IRB, or the FDA may, at any time, suspend, terminate or impose a clinical hold on ongoing clinical trials. For example, in October 2016, we decided to discontinue development of revusiran, an investigational RNAi therapeutic that was in development for the treatment of patients with cardiomyopathy due to hATTR amyloidosis, due to safety concerns. If the FDA imposes a clinical hold, clinical trials cannot commence or recommence without FDA authorization and then only under terms authorized by the FDA.  For example, in September 2017, we temporarily suspended dosing in all ongoing fitusiran studies pending further review of a fatal thrombotic SAE and agreement with regulatory authorities on a risk mitigation strategy. We have reached alignment with study investigators and the FDA on safety measures and a risk mitigation strategy to enable resumption of dosing in clinical studies with fitusiran, including our Phase 2 OLE study and the ATLAS Phase 3 program.

Clinical trials involve the administration of an investigational new drug to healthy volunteers or patients under the supervision of a qualified investigator. Clinical trials must be conducted in compliance with federal regulations and requirements, including GCP, which are ethical and scientific quality standards and FDA requirements for conducting, recording and reporting clinical trials to assure data integrity and protect the rights, safety and well-being of trial participants and include the requirement that all research subjects provide their informed consent for their participation in any clinical study. Clinical studies are conducted under protocols detailing, among other things, the objectives of the trial and the safety and effectiveness criteria to be evaluated. Each protocol involving testing on human subjects in the United States must be submitted to the FDA as part of the IND. In addition, clinical trials must be conducted in compliance with federal regulations and requirements, commonly referred to as good clinical practice, or GCP, to assure data integrity and protect the rights, safety and well-being of trial participants.  Among other things, GCP requires that all research subjects provide their informed consent prior to participating in any clinical study, and that an IRB at each institution participating in the clinical trial must review and approve the plan

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for any clinical trial before it commences at that institution and the IRB must conduct continuing review.review throughout the trial. The IRB must review and approve, among other things, the study protocol and informed consent information to be provided to study subjects. An IRB must operate in compliance with FDA regulations.

Clinical trials to support NDAs for marketing approval are typically conducted in three sequential phases, which may overlap or be combined.

Phase 1, Phase 2 or Phase 3 testing of any drug candidates may not be completed successfully within any specified time period, if at all. The FDA closely monitors the progress of each of the three phases of clinical trials that are conducted in the United States. The FDA may, at its discretion, reevaluate, alter, suspend or terminate the testing based upon the data accumulated to that point and the FDA’s assessment of the risk/benefit ratio to the subject. The FDA, anAn IRB or a clinical trial sponsor also may suspend or terminate clinical trials at any time for various reasons, including a finding that the subjects or patients are being exposed to an unacceptable health risk. The FDA can also request that additional clinical trials be conducted as a condition to product approval. Finally, sponsors are required to publicly disseminate information about certain ongoing and completed clinical trials on a government website administered by the National Institutes of Health, or NIH, and are subject to civil monetary penalties and other civil and criminal sanctions for failing to meet these obligations. After successful completion of the required clinical testing, as well as nonclinical testing and manufacturing requirements, generally an NDA is prepared and submitted to the FDA.NIH.

New Drug Applications.

We believe that any RNAi product candidate we develop, whether for the treatment of ATTR amyloidosis, AHPs, hemophilia, and RBD, complement mediated diseases, hypercholesterolemia or the various indications targeted in our development or pre-clinicalnonclinical discovery programs, will be regulated as a non-biological new drug by the FDA. FDA approval of an NDA is required before marketingcommercial distribution of a non-biological new drug may begin in the United States. TheIn December 2017, we submitted our first NDA to the FDA for patisiran.  An NDA must include the results of extensive pre-clinical,nonclinical, clinical and other testing, as described above, a compilation of data relating to the product’s pharmacology, chemistry, manufacture and controls, proposed labeling and other information. In addition, an NDA for a new active ingredient, new indication, new dosage form, new dosing regimen, or new route of administration typically must contain data assessing the safety and effectiveness for the claimed indication in all relevant pediatric subpopulations, and support dosing and administration for each pediatric subpopulation for which the drug is shown to be safe and effective. In some circumstances, the FDA may grantalthough deferrals for the submission of some or all pediatric data, or full or partial waivers.waivers may be available in some circumstances.

The cost of preparing and submitting an NDA is substantial. Under federal law, NDAs are subject to substantial application user fees and the sponsor of an approved NDA is also subject to annual product and establishment user fees. Under the Prescription Drug User Fee Act, or PDUFA, as amended, each NDA must be accompanied by a user fee. For fiscal year 2018, the user fee for each NDA requiring clinical data is approximately $2.4 million. The PDUFA also imposes an annual program fee for each approved prescription drug, which is set at approximately $300,000 for fiscal year 2018. The FDA adjusts the PDUFA user fees on an annual basis. According to the FDA’s fee schedule, effective through September 30, 2015, the user fee for each NDA application requiring clinical data, is approximately $2.3 million. PDUFA also imposes an annual product fee for drugs and an annual establishment fee on facilities used to manufacture prescription drugs. Fee waivers or reductions are available in certain circumstances, including a waiver of the application fee for the first application filed by a small business. Additionally, no user fees are assessed on NDAs for products designated as orphan drugs, unless the product also includes a non-orphan indication.

The FDA conducts a preliminary review of all NDAs within the first 60 days after submission before accepting them for filing to determine whether they are sufficiently complete to permit substantive review. The FDA may request additional information rather than accept an NDA for filing. If the submission is accepted for filing, the FDA begins an in-depth review of the NDA. The FDA has agreed to specified performance goals

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regarding the timing of its review of NDAs, although the FDA does not always meet these goals. The review process is often significantly extended by FDA requests for additional information or clarification regarding information already provided in the submission. The FDA may also refer applications for novel drug products or drug products that present difficult questions of safety or efficacy to an advisory committee, typically a panel that includes independent clinicians and other experts, for review, evaluation and a recommendation as to whether the application should be approved. The FDA is not bound by the recommendation of an advisory committee, but it generally follows such recommendations. The FDA normally conducts a pre-approval inspection to gain assurance that the manufacturing facility, methods and controls are

adequate to preserve the drug’s identity, strength, quality, purity and stability, and are in compliance with regulations governing cGMPs.current good manufacturing practice, or cGMP, requirements. In addition, the FDA often will conduct a bioresearch monitoring inspection of select clinical trial sites involved in conducting pivotal studies to assure data integrity and compliance with applicable GCP requirements.

If the FDA evaluation of the NDA and the various inspections of manufacturing facilities and clinical trial sites are favorable, the FDA may issue an approval letter, which authorizes commercial marketing of the drug with specific prescribing information for a specific indication. As a condition of NDA approval, the FDA may require post-approval testing, sometimes referred to as Phase 4 trials and surveillance to monitor the drug’s safety or effectiveness and may impose other conditions, including labeling restrictions, such as a Boxed Warning, and/or distribution and use restrictions through a Risk Evaluation and Mitigation Strategy, or REMS, all of which can materially impact the potential market and profitability of the drug. In addition, the FDA may impose distribution and use restrictions and other limitations on labeling and communication activities with respect to an approved drug product through a Risk Evaluation and Mitigation Strategy, or REMS, plan. Once granted, product approvals may be further limited or withdrawn if compliance with regulatory standards is not maintained or safety or other problems are identified following initial marketing.

Once an NDA is approved, a product will be subject to certain post-approval requirements, including requirements for adverse eventregistration and listing, AE reporting, submission of periodic reports, recordkeeping, product sampling and distribution. Additionally, the FDA also strictly regulates the promotional claims that may be made about prescription drug products and biologics. In particular, the FDA generally prohibits pharmaceutical companies from promoting their drugs or biologics for uses that are not approved by the FDA as reflected in the product’s approved labeling. In addition, the FDA requires substantiation of any safety or effectiveness claims, including claims that one product is superior in terms of safety or effectiveness to another. Superiority claims generally must be supported by two adequate and well-controlled head-to-head clinical trials. To the extent that market acceptance of our products may dependdepends on their superiority over existing therapies, any restriction on our ability to advertise or otherwise promote claims of superiority, or requirements to conduct additional expensive clinical trials to provide proof of such claims, could negatively affect the sales of our products or our costs. We must also notify the FDA of any change in an approved product beyond variations already allowed in the approval. Certain changes to the product, its labeling or its manufacturing require prior FDA approval and may require the conduct of further clinical investigations to support the change, which may require the payment of additional, substantial user fees.change. Such approvals may be expensive and time-consuming and, if not approved, the FDA will not allow the product to be marketedcommercially distributed as modified.

If the FDA’s evaluation of the NDA submission or manufacturing facilities is not favorable, the FDA may refuse to approve the NDA or issue a complete response letter. The complete response letter describes the deficiencies that the FDA has identified in an application and, when possible, recommends actions that the applicant might take to placeallow FDA to approve the application in condition for approval.application. Such actions may include, among other things, conducting additional safety or efficacy studies after which the sponsor may resubmit the application for further review.studies. Even with the completion of this additional testing or the submission of additional requested information, the FDA ultimately may decide that the application does not satisfy the regulatory criteria for approval. With limited exceptions, the FDA may withhold approval of an NDA regardless of prior advice it may have provided or commitments it may have made to the sponsor.

Some of our product candidates may need to be administered using specialized drug delivery systems/systems that are considered to be medical devices. We may rely on drug delivery systems that are already approved to deliver drugs like ours to similar physiological sites or, in some instances, we may need to modify the design or labeling of the legally available device for delivery of our product candidate. The FDA may regulate theour product candidate when used with a specialized drug delivery system as a combination product, or

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which could permit the combination to be approved through a single application, such as an NDA.  Alternatively, the FDA could require separate, additional approvals or clearances for the modified device. In addition, to the extent the delivery device is owned by another company, we would need that company’s cooperation to implement the necessary changes to the device and to obtain any additional approvals or clearances. Obtaining such additional approvals or clearances, and cooperation of other companies, when necessary, could significantly delay, and increase the cost of obtaining marketing approval, which could reduce the commercial viability of a product candidate. To the extent that we rely on previously unapproved drug delivery systems, we may be subject to additional testing and approval requirements from the FDA above and beyond those described above.

Abbreviated Applications.

Once an NDA is approved, the product covered thereby becomes a listed drug that can, in turn, be relied upon by potential competitors in support of approval of an abbreviated new drug application, or ANDA, or 505(b)(2) application upon expiration of certain patent and non-patent exclusivity periods, if any.application. An approved ANDA generally provides an abbreviated approval pathway for marketing of a drug product that has the same active ingredients in the same strength, dosage form and route of administration as the listed drug and has been shown through appropriate testing (unless waived) to be bioequivalent to the listed drug. There is no requirement, other than the requirement for bioequivalence testing (which may be waived by the FDA), for an ANDA applicant to conduct or submit results of nonclinical or clinical tests to prove the safety or effectiveness of its drug product. Drugs approved in this way are commonly referred to as generic equivalents to the listed drug are listed as such by the FDA and can often be substituted by pharmacists under prescriptions written for the original listed drug. A 505(b)(2) application is a type of NDA that relies, in part, upon data the applicant does not own and to which it does not have a right of reference. Such applications typically are submitted for changes to previously approved drug products.

The approval of ANDAs and 505(b)(2) applications can be delayed by patents and non-patent exclusivity covering the listed drug. Federal law provides for a period of three years of exclusivity following approval of a listed drug that contains a previously approved active ingredient but is approved in, among other things, a new dosage, dosage form, route of administration or combination, or for a new use, if the FDA determines that new clinical investigations, other than bioavailability studies, that were conducted or sponsored by the applicant and are essential to the approval of the application. This three-year exclusivity covers only the conditions of use associated withapproval for which the new clinical investigations were essential, such as a new dosage form or indication.  Accordingly, three-year exclusivity generally protects changes to a previously approved drug product that require clinical testing for approval and, as a general matter, does not prohibit the FDA from approving ANDAs or 505(b)(2) applications for generic versions of the original, unmodified drug product.

Federal law also provides a five-year period of up to five yearsNCE exclusivity following approval of a drug containing no previously approvedthat contains a new chemical entity, or NCE.  An NCE is a drug that contains an active moiety which is the(the molecule or ion responsible for the action of the drug substance, during whichsubstance) that has never previously been approved by the FDA. If a listed drug has NCE exclusivity, ANDAs and 505(b)(2) applications referencing the protected listed drug cannot be submitted to the FDA for five years unless the submission accompaniesapplication contains a challenge tocertification challenging a listed patent, i.e., a paragraph IV certification (discussed further below), in which case the submissionANDA or 505(b)(2) application may be madesubmitted four years following approval of the original product approval.listed drug. Five-year and three-year exclusivity will not delay the submission or approval of a full NDA; however, an applicant submitting a full NDA would be required to conduct or obtain a right of reference to all of the pre-clinicalnonclinical studies and adequate and well-controlled clinical trials necessary to demonstrate safety and effectiveness.

Additionally, in the event that the sponsor of the listed drug has properly informed the FDA of patents covering its listed drug, applicants submitting an ANDA or 505(b)(2) application referencing thea listed drug generally are required to make onea certification with respect to each patent listed in the FDA’s publication Approved Drug Products with Therapeutic Equivalence Evaluations, commonly referred to as the Orange Book, for the listed drug.  The only exception is if the applicant is not seeking approval of foura use claimed by a method-of-use patent, in which case the applicant can submit a statement to that effect. These certifications for each listed patent, except for patents covering methods of use for which(and statements) determine when the FDA can approve the ANDA or 505(b)(2) application. If the ANDA or 505(b)(2) applicant iscertifies that it does not seeking approval.intend to market its generic product before a listed patent expires (i.e., a paragraph III certification), then the FDA cannot grant effective approval of the ANDA or 505(b)(2) application until the relevant patent expires.  If anthe ANDA or 505(b)(2) applicant certifies its belief that one or morea listed patents arepatent is invalid, unenforceable, or will not be infringed (and thereby indicatesby its proposed product, and thus that it is seeking approval prior to patent expiration)expiration (i.e., ita paragraph IV certification), the statute provides a process for litigating the patent infringement issues during the FDA’s review of the ANDA or 505(b)(2) application.  In particular, the applicant is required to provide notice of its filingpatent challenge to the NDA sponsor and the patent holder within certain time limits. If the patent holder then initiates a suit for patent infringement against the ANDA or 505(b)(2) applicant within 45 days of receipt of the notice, the FDA cannot grant effective approval of the ANDA or 505(b)(2) application until either 30 months have passed (which may be extended or shortened in certain cases) or there has been a court decision or settlement order holding or stating that the patents in question are invalid, unenforceable or not infringed. If the patent holder does not initiate a suit for patent infringement within the 45 days, the ANDA or 505(b)(2) application may be approved immediately upon successful completion of FDA review, unless blocked by another listed patent or regulatory exclusivity period. If the ANDA or 505(b)(2) applicant certifies that it does not intend to market its generic product before some or all listed patents on the listed drug expire, then the FDA cannot grant effective approval of the ANDA or 505(b)(2) application until those patents expire. The first of the ANDA applicants submitting substantially complete applications certifying that one or more listed patents for a

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particular product are invalid, unenforceable, or not infringed may qualify for an exclusivity period of 180 days running from when the generic product is first marketed, during which subsequently submitted ANDAs containing similar certifications cannot be granted effective approval. The 180-day generic exclusivity can be forfeited in various ways, including if the first applicant does not market its product within specified statutory timelines. If more than one applicant files a substantially complete ANDA on the same day, each such first applicant will be entitled to share the 180-day exclusivity period, but there will only be one such period, beginning on the date of first marketing by any of the first applicants.

The Patient Protection and Affordable Care Act, also referred to as the PPACA or the Affordable Care Act, signed into law on March 23, 2010, includes a subtitle called the Biologics Price Competition and Innovation Act of 2009, or BPCI Act, which created an abbreviated approval pathway for biological products shown to be similar to, or interchangeable with, an FDA-licensed reference biological product. This amendment to the Public Health Service Act attempts to minimize duplicative testing. Biosimilarity, which requires that there be no clinically meaningful differences between the biological product and the reference product in terms of safety, purity, and potency, can be shown through analytical studies, animal studies, and a clinical study or studies. Interchangeability requires that a product is biosimilar to the reference product and the product must demonstrate that it can be expected to produce the same clinical results as the reference product and, for products administered multiple times, the biologic and the reference biologic may be switched after one has been previously administered without increasing safety risks or risks of diminished efficacy relative to exclusive use of the reference biologic. However, complexities associated with the larger, and often more complex, structure of biological products, as well as the process by which such products are manufactured, pose significant hurdles to implementation that are still being worked out by the FDA.

A reference biologic is granted twelve years of exclusivity from the time of first licensure of the reference product. The first biologic product submitted under the abbreviated approval pathway that is determined to be interchangeable with the reference product has exclusivity against other biologics submitting under the abbreviated approval pathway for the lesser of (i) one year after the first commercial marketing, (ii) 18 months after approval if there is no legal challenge, (iii) 18 months after the resolution in the applicant’s favor of a lawsuit challenging the biologics’ patents if an application has been submitted, or (iv) 42 months after the application has been approved if a lawsuit is ongoing within the 42-month period.Orphan Drug Designation (ODD).

Under the Orphan Drug Act, as amended, the FDA may grant ODD to a drug intended to treat a rare disease or condition, which is generally a disease or condition that affects fewer than 200,000 individuals in the United States or more than 200,000 individuals in the United States and for which there is no reasonable expectation that the cost of developing and making availablerecovering drug development costs in the United States a drug for this type of disease or condition will be recovered from sales in the United States for that drug.States. ODD must be requested before submitting an NDA. After the FDA grants ODD, the identity of the therapeutic agent and its potential orphan use are disclosed publicly by the FDA. We intend to request ODD designation for our product candidates, if applicable. For example, the FDA has granted ODD for patisiran as a therapeutic approach for the treatment of FAP and for ALN-AT3ATTR amyloidosis, givosiran as a therapeutic approach for hemophilia.AHPs, fitusiran as a therapeutic approach for hemophilia A and B, and inclisiran as a therapeutic approach for HoFH.

If a product that has ODD subsequently receives the first FDA approval for the disease for which it has such designation, the product is entitled to orphan productdrug exclusivity, which means that the FDA may not approve for seven years any other applications, including a full NDA, to market the same orphan drug for the same indication, except in very limited circumstances, for seven years.circumstances. For purposes of small molecule drugs, the FDA defines “same drug” as a drug that contains the same active moiety and is intended for the same use as the previously approved orphan drug. For purposes of large molecule drugs, the FDA defines “same drug” as a drug that contains the same principal molecular structural features, but not necessarily all of the same structural features, and is intended for the same use as the drug in question. Notwithstanding the above definitions, a drug that is clinically superior to an orphan drug will not be considered the “same drug” and thus will not be blocked by orphan drug exclusivity.

A designated orphan drug may not receive orphan drug exclusivity if it is approved for a use that is broader than the indication for which it received orphan designation. In addition, orphan drug exclusive marketing rights in the United States may be lost if the FDA later determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantities of the drug to meet the needs of patients with the rare disease or condition.

Pediatric Study Plans.

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The Orphan Products Grants Program in FDA’s Office of Orphan Products Development, or OOPD, with an annual budget of approximately $14.0 million, supports clinical development of products including drugs, biologics, medical devices and medical foods for use in rare diseases and conditions where no current therapy exists or where the proposed product will be superior to the existing therapy. This program provides grants for clinical studies on safety and/or effectiveness that will either result in, or substantially contribute to, market approval of these products. In addition, OOPD will administer a new grant program, the Pediatric Device Consortia Grant Program, resulting from the 2007 FDAAA legislation to support nonprofit consortia to facilitate pediatric medical device development. The future availability of such grants is subject to uncertainties regarding continued federal funding.

From time to time, legislation is drafted and introduced in Congress that could significantly change the statutory provisions governing the approval, manufacturing and marketing of drug products. In addition, FDA regulations and guidance are often revised or reinterpretedFDCA, as amended by the agency or reviewing courts in ways that may significantly affect our business and development of our product candidates and any products that we may commercialize. It is impossible to predict whether additional legislative changes will be enacted, or FDA regulations, guidance or interpretations changed, or what the impact of any such changes may be. Federal budget uncertainties or spending reductions may reduce the capabilities of the FDA, extend the duration of required regulatory reviews, and reduce the availability of clinical research grants.

Recently, the Food and Drug Administration Safety and Innovation Act, or FDASIA, which was signed into law on July 9, 2012, amended the FDCA. FDASIA, requires that a sponsor who is planning to submit a marketing application for a drug or biological product that includes a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration submit an initial Pediatric Study Plan, or PSP, within sixty days of an end-of-phase 2 meeting or as may be agreed between the sponsor and the FDA. Drugs with ODD are exempt from these requirements. The initial PSP must include an outline of the pediatric study or studies that the sponsor plans to conduct, including study objectives and design, age groups, relevant endpoints and statistical approach, or a justification for not including such detailed information, and any request for a deferral of pediatric assessments or a full or partial waiver of the requirement to provide data from pediatric studies along with supporting information. The FDA and the sponsor must reach agreement on the PSP. A sponsor can submit amendments to an agreed-upon initial PSP at any time if changes to the pediatric plan need to be considered based on data collected from nonclinical studies, early phase clinical trials, and/or other clinical development programs.

Fast Track Program.

The FDA has a Fast Track program that is intended to expedite or facilitate the process for reviewing new drugs and biological products that meet certain criteria. Specifically, new drugs and biological products are eligible for Fast Track designation if they are intended to treat a serious or life-threatening condition and demonstrate the potential to address unmet medical needs for the condition. Fast Track designation applies to the combination of the product and the specific indication for which it is being studied. The sponsor of a new drug or biological product may request the FDA to designate the drug or biologic as a Fast Track product at any time during the clinical development of the product. Unique to aproduct, but ideally no later than the pre-NDA or –biologics license application, or BLA, meeting. Fast Track product,designation provides opportunities for frequent interactions with FDA to expedite drug development and review as well as the FDA may consideropportunity for priority and/or rolling review sections of the marketing application on a rolling basis before the complete application is submitted, if the sponsor provides a schedule for the submission of the sections of the application, the FDA agrees to accept sections of the application and determines that the schedule is acceptable, and the sponsor pays any required user fees upon submission of the first section of the application.NDA. We intend to request Fast Track designation for our product candidates, if applicable. For example, the FDA granted Fast Track designation to patisiran for the treatment of FAP.hATTR amyloidosis.

Any product submitted to the FDA for marketing, including under a Fast Track program, may be eligible for other types of FDA programs intended to expedite development and review, such as priority review and accelerated approval. Any product is eligible for priority review if it has the potential totreats a serious condition and, if approved, would provide safe and effective therapy where no satisfactory alternative therapy exists or a significant improvement in the safety or effectiveness of treatment, diagnosis or prevention of a disease compared to marketed products. The FDA will attempt to direct additional resources to the evaluation ofFDA’s goal for taking action on an application forwith a new drug or biological product designatedPriority Review designation is six months instead of ten months. The FDA granted our request for priority review infor patisiran and has set an effort to facilitateaction date of August 11, 2018 under the review.PDUFA. Additionally, a product may be eligible for accelerated approval. Drug or biological products studied for their safety and effectiveness in treating serious or life-threatening illnesses and

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that provide meaningful therapeutic benefit over existing treatments may receive accelerated approval, which means that they may be approved on the basis of adequate and well-controlled clinical studies establishing that the product has an effect on a surrogate endpoint that is reasonably likely to predict a clinical benefit, or on the basis of an effect on a clinical endpoint other than survivalirreversible morbidity or mortality that is reasonably likely to predict an effect on irreversible morbidity.morbidity or mortality or other clinical benefits. As a condition of approval, the FDA may require that a sponsor of a drug or biological product receiving accelerated approval perform adequate and well-controlled post-marketing clinical studies.studies to verify the predicted clinical benefit. In addition, the FDA currently requires as a condition for accelerated approval pre-approval of promotional materials, which could adversely impact the timing of the commercial launch of the product. Fast Track designation, priority review and accelerated approval do not change the standards for approval but may expedite the development or approval process.

The Food and Drug Administration Safety and Innovation Act of 2012Breakthrough Therapy Designation.

FDASIA also amended the FDCA to require the FDA to expedite the development and review of a “breakthrough therapy.” A drug or biological product can be designated as a breakthrough therapy if it is intended to treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that it may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints. A sponsor may request that a drug or biological product be designated as a breakthrough therapy at any time during the clinical development of the product. If so designated, the FDA shall act to expedite the development and review of the product’s marketing application, including by meeting with the sponsor throughout the product’s development, providing timely advice to the sponsor to ensure that the development program to gather nonclinical, manufacturing/controls and clinical data is as efficient as practicable, involving senior managers and experienced review staff in a cross-disciplinary review, assigning a cross-disciplinary project lead for the FDA review team to facilitate an efficient review of the development program and to serve as a scientific liaison between the review team and the sponsor, and taking steps to ensure that the design of the clinical trials is as efficient as practicable.practicable, and allowing a rolling review. The FDA granted Breakthrough Therapy designation for patisiran and givosiran. We intend to request “breakthrough therapy” designation for our other product candidates, if applicable.

Foreign Regulation of New Drug Compounds

In addition to regulations in the United States, we are subject to a variety of regulations in other jurisdictions governing, among other things, clinical trials and any commercial sales and distribution of our products.

Whether or not we obtain FDA approval for a product, we must obtain the requisite approvals from regulatory authorities in all or most foreign countries prior to the commencement of clinical trials or marketing of the product in those countries. Certain countries outside of the United States have a similar process that requires the submission of a clinical trial application, or CTA, much like the IND prior to the commencement of human clinical trials. In Europe, for example, a CTA must be submitted to each country’s national health authority and an independent ethics committee, much like the FDA and IRB, respectively. Once the CTA is approved in accordance with a country’s requirements, clinical trial development may proceed. Similarly, all clinical trials in Australia require, among other things, review and approval of clinical trial proposals by an ethics committee, which provides a combined ethical and scientific review process.

The requirements and process governing the conduct of clinical trials, product licensing, pricing and reimbursement vary from country to country. In all cases, the clinical trials must be conducted in accordance with GCP, which have their origin in the World Medical Association’s Declaration of Helsinki, the applicable regulatory requirements, and guidelines developed by the International Conference on Harmonization for GCP practices in clinical trials.

The approval procedure also varies among countries and can involve requirements for additional testing. The time required may differ from that required for FDA approval and may be longer than that required to obtain FDA approval. Although there are some procedures for unified filings in the EU, in general, each country has its own procedures and requirements, many of which are time consuming and expensive. Thus, there can be substantial delays in obtaining required approvals from foreign regulatory authorities after the relevant applications are filed.

In Europe, marketing authorizations may be submitted under a centralized or decentralized procedure. The centralized procedure is mandatory for the approval of biotechnology and many pharmaceutical products and

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provides for the grant of a single marketing authorization that is valid in all EU member states. The decentralized procedure is a mutual recognition procedure that is available at the request of the applicant for medicinal products that are not subject to the centralized procedure. We intend to strive to choose the appropriate route of European regulatory filing to accomplish the most rapid regulatory approvals. However, our chosen regulatory strategy may not secure regulatory approvals on a timely basis or at all.

If we fail to comply with applicable foreign regulatory requirements, we may be subject to, among other things, fines, suspension or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.

Pharmaceutical Coverage, Pricing and ReimbursementReimbursement.

Significant uncertainty exists as to the coverage and reimbursement status of any drug products for which we obtain regulatory approval. In the United States and markets in other countries, sales of any products for which we may receive regulatory approval for commercial sale will depend in part on the availability of reimbursement from third-party payors. Third-party payors include government health administrative authorities,healthcare programs, managed care providers, private health insurers and other organizations. The process for determining whether a payor will provide coverage for a drug product may be separate from the process for setting the price or reimbursement rate that the payor will pay for the drug product. Third-party payors may limit coverage to specific drug products on an approved list, or formulary, which might not include all of the FDA-approved drugs for a particular indication. Third-party payors may provide coverage, but place stringent limitations on such coverage, such as requiring alternative treatments to be tried first. These third-party payors are increasingly challenging the price and examining the medical necessity and cost-effectiveness of medical products and services, in addition to their safety and efficacy. In addition, significant uncertainty exists as to the reimbursement status of newly approved healthcare product candidates.products. We may need to conduct expensive pharmacoeconomic studies in order to demonstrate the medical necessity and cost-effectiveness of our products, in addition to incurring the costs required to obtain FDA approvals. Our product candidates may not be considered medically reasonable or necessary or cost-effective. Even if a drug product is covered, a payor’s decision to provide coverage for a drug product does not imply that an adequate reimbursement rate will be approved. Adequate third-party reimbursement may not be available to enable us to maintain price levels sufficient to realize an appropriate return on our investment in product development.

Federal, state and local governments in the United States and foreign governments continue to consider legislation to limit the growth of healthcare costs, including the cost of prescription drugs. Specifically, there have been several recent U.S. Congressional inquiries and proposed federal and state legislation designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under Medicare, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drugs.  On January 2, 2013, the American Taxpayer Relief Act of 2012 was signed into law, which, among other things, further reduced Medicare payments to several types of providers. Future legislation could limit payments for pharmaceuticals such as the drug candidates that we are developing.

Different pricing and reimbursement schemes exist in other countries. In the EU, governments influence the price of pharmaceuticaldrug products through their pricing and reimbursement rules and control of national health care systems that fund a large part of the cost of those products to consumers. Some jurisdictions operate systems under which products may be marketed only after a reimbursement price has been agreed. To obtain reimbursement or pricing approval, some of these countries may require the completion of clinical trials that compare the cost-effectiveness of a particular product candidate to currently available therapies. Other member states allow companies to set their own prices for medicines, but monitor and control company profits. The downward pressure on health care costs in general, particularly prescription drugs, has become very intense. As a result, increasingly high barriers are being erected to the entry of new products. In addition, in some countries, cross-border imports from low-priced markets exert competitive pressure that may reduce pricing within a country.

The marketability of any products for which we receive regulatory approval for commercial sale may suffer if the government and third-party payors fail to provide adequate coverage and reimbursement. In addition, the emphasis on managed care in the United States has increased and we expect will continue to exert downward pressure on pharmaceutical pricing. Coverage policies, third-party reimbursement rates and pharmaceutical pricing regulations may change at any time. Even if favorable coverage and reimbursement status is attained for one or more products for which we receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future.

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In March 2010, the PPACA,Patient Protection and Affordable Care Act, also referred to as amended by the HealthAffordable Care and Education Reconciliation Act of 2010,or the PPACA, was enacted, which includes measures that have or will significantly change the way health care is financed by both governmental and private insurers. Among the provisions of the PPACA of greatest importance to the pharmaceutical industry are the following:

Possible Change in Laws or Policies.

From time to time, legislation is drafted and introduced in Congress that could significantly change the statutory provisions governing the approval, manufacturing and marketing of drug products. In addition, FDA regulations and guidance are often revised or reinterpreted by the agency or reviewing courts in ways that may significantly affect our business and development of our product candidates and any products that we may commercialize. It is impossible to predict whether additional legislative changes will be enacted, or FDA regulations, guidance or interpretations will be changed, or what the impact of any such changes may be. Federal budget uncertainties or spending reductions may reduce the capabilities of the FDA, extend the duration of required regulatory reviews, and reduce the availability of clinical research grants.

EU Regulatory Considerations

In the EU medicinal products are subject to extensive pre- and post-market regulation by regulatory authorities at both the EU and national levels.

Clinical Trials.

Clinical trials of medicinal products in the EU must be conducted in accordance with EU and national regulations and the International Conference on Harmonization, or ICH, guidelines on GCP. If the sponsor of the clinical trial is not established within the EU, it must appoint an entity within the EU to act as its legal representative. The sponsor must take out a clinical trial insurance policy, and in most EU countries the sponsor is liable to provide ‘no fault’ compensation to any study subject injured in the clinical trial.

Prior to commencing a clinical trial, the sponsor must obtain a CTA from the competent authority, and a positive opinion from an independent ethics committee. The application for a CTA must include, among other things, a copy of the trial protocol and an investigational medicinal product dossier containing information about the manufacture and quality of the medicinal product under investigation. Any substantial changes to the trial protocol or other information submitted with the clinical trial applications must be notified to or approved by the relevant competent authorities and ethics committees.

Currently, CTAs must be submitted to the competent authority in each EU member state in which the trial will be conducted. Under the new Regulation on Clinical Trials, which is currently expected to come into application in the second half of 2019, there will be a centralized application procedure where one national authority leads the scientific review of the application leading to increased information-sharing and decision-making between member states.  Each concerned member state will continue to complete an ethical review of any CTA.

Information related to the product, patient population, phase of investigation, study sites and investigators, and other aspects of the clinical trial is made public by the competent authority once the CTA is approved. The results of the clinical trial must be submitted by the sponsor to the competent authorities and, with the exception of non-pediatric Phase 1 trials, will be made public at the latest within six months of the end of a pediatric clinical trial, or otherwise within 12 months after the end of the trial.

During the development of a medicinal product, the EMA and national medicines regulators within the EU provide the opportunity for dialogue and guidance on the development program. At the EMA level, this is usually done in the form of scientific advice, which is given by the Scientific Advice Working Party of the Committee for Medicinal Products for Human Use, or CHMP. A fee is incurred with each scientific advice procedure. Advice from the EMA is typically provided based on questions concerning, for example, quality (chemistry, manufacturing and controls testing), nonclinical testing and clinical studies, and pharmacovigilance plans and risk-management programs. Advice is not legally binding with regard to any future marketing authorisation application of the product concerned.

Marketing Authorisations.

After completion of the required clinical testing, we must obtain a marketing authorisation before we may place a medicinal product on the market in the EU. There are various application procedures available, depending on the type of product involved. All application procedures require an application in the common technical document, or CTD, format, which includes the submission of detailed information about the manufacturing and quality of the product, and nonclinical study and clinical trial information. There is an increasing trend in the EU towards greater transparency and, while the manufacturing or quality information is currently generally protected as confidential information, the EMA and national regulatory authorities are now liable to disclose much of the nonclinical and clinical information in marketing authorisation dossiers, including the full clinical study reports, in response to freedom of information requests after the marketing authorisation has been granted. In October 2014, the EMA adopted a policy under which clinical study reports would be posted on the agency’s website following the grant, denial or withdrawal of a marketing authorisation application, subject to procedures for limited redactions and protection against unfair commercial use. A similar requirement is contained in the new Regulation on Clinical Trials that is currently expected to take effect in the second half of 2019.

The centralized procedure gives rise to marketing authorisations that are valid throughout the EU and, by extension (after national implementing decisions), in Norway, Iceland and Liechtenstein, which, together with the EU member states, comprise the European Economic Area, or EEA. Applicants file MAAs with the EMA, where they are reviewed by relevant scientific committees, including the CHMP. The EMA forwards CHMP opinions to the European Commission, or EC, which uses them as the basis for deciding whether to grant a marketing authorisation. The centralized procedure is compulsory for medicinal products that (1) are derived from biotechnology processes, (2) contain a new active substance (not yet approved on November 20, 2005) indicated for the treatment of certain diseases, such as HIV/AIDS, cancer, diabetes, neurodegenerative disorders, viral diseases or autoimmune diseases and other immune dysfunctions, (3) are orphan medicinal products or (4) are advanced therapy medicinal products, such as gene or cell therapy medicines. For medicines that do not fall within these categories, an applicant may voluntarily submit an application for a centralized marketing authorisation to the EMA, as long as the CHMP agrees that (i) the medicine concerned contains a new active substance (not yet approved on November 20, 2005), (ii) the medicine is a significant therapeutic, scientific, or technical innovation, or (iii) if its authorization under the centralized procedure would be in the interest of public health. In December 2017, we submitted our first MAA for patisiran under the centralized procedure, which has been accepted by the EMA.

For those medicinal products for which the centralized procedure is not available, the applicant must submit MAAs to the national medicines regulators through one of three procedures: (1) a national procedure, which results in a marketing authorisation in a single EU member state; (2) the decentralized procedure, in which applications are submitted simultaneously in two or more EU member states; and (3) the mutual recognition procedure, which must be used if the product has already been authorized in at least one other EU member state, and in which the EU member states are required to grant an authorization recognizing the existing authorization in the other EU member state, unless they identify a serious risk to public health. A national procedure is only possible

for one member state; as soon as an application is submitted in a second member state the mutual recognition or decentralized procedure will be triggered.

Under the centralized procedure in the EU, the maximum timeframe for the evaluation of an MAA is 210 days. However, this timeline excludes clock stops, when additional written or oral information is to be provided by the applicant in response to questions asked by the CHMP, so the overall process typically takes a year or more. Accelerated evaluation might be granted by the CHMP in exceptional cases, when a medicinal product is expected to be of a major interest for public health and therapeutic intervention, defined by the absence or insufficiency of an appropriate alternative therapeutic approach for the disease to be treated; and anticipation of high therapeutic benefit of the new product. In this circumstance, EMA ensures that the opinion of the CHMP is given within 150 days. In November 2017, the EMA granted an accelerated assessment for patisiran.

Data Exclusivity.

MAAs for generic medicinal products do not need to include the results of pre-clinical studies and clinical trials, but instead can refer to the data included in the marketing authorisation of a reference product for which regulatory data exclusivity has expired. If a marketing authorisation is granted for a medicinal product containing a new active substance, that product benefits from eight years of data exclusivity, during which generic MAAs referring to the data of that product may not be accepted by the regulatory authorities, and a further two years of market exclusivity, during which such generic products may not be placed on the market. The two-year period may be extended to three years if during the first eight years a new therapeutic indication with significant clinical benefit over existing therapies is approved.

There is a special regime for biosimilars, or biological medicinal products that are similar to a reference medicinal product but that do not meet the definition of a generic medicinal product, for example, because of differences in raw materials or manufacturing processes. For such products, the results of appropriate pre-clinical studies or clinical trials must be provided, and guidelines from the EMA detail the type of quantity of supplementary data to be provided for different types of biological product. There are no such guidelines for complex biological products, such as gene or cell therapy medicinal products, and so it is unlikely that biosimilars of those products will currently be approved in the EU. However, guidance from the EMA states that they will be considered in the future in light of the scientific knowledge and regulatory experience gained at the time.

Orphan Medicinal Products.

The EMA’s COMP may recommend orphan medicinal product designation to promote the development of products that are intended for the diagnosis, prevention or treatment of life-threatening or chronically debilitating conditions affecting not more than five in 10,000 persons in the EU. Additionally, designation is granted for products intended for the diagnosis, prevention or treatment of a life-threatening, seriously debilitating or serious and chronic condition and when, without incentives, it is unlikely that sales of the product in the EU would be sufficient to justify the necessary investment in developing the medicinal product. The COMP may only recommend orphan medicinal product designation when the product in question offers a significant clinical benefit over existing approved products for the relevant indication. Following a positive opinion by the COMP, the EC adopts a decision granting orphan status. The COMP will reassess orphan status in parallel with EMA review of an MAA and orphan status may be withdrawn at that stage if it no longer fulfills the orphan criteria (for instance because in the meantime a new product was approved for the indication and no convincing data are available to demonstrate a significant benefit over that product). Orphan medicinal product designation entitles a party to financial incentives such as reduction of fees or fee waivers and ten years of market exclusivity is granted following marketing authorisation. During this period, the competent authorities may not accept or approve any similar medicinal product for the same therapeutic indication, unless the second medicinal product is safer, more effective or otherwise clinically superior. This period may be reduced to six years if the orphan medicinal product designation criteria are no longer met, including where it is shown that the product is sufficiently profitable not to justify maintenance of orphan designation.  Patisiran, givosiran and fitusiran have been granted orphan medicinal product designation.

Post-Approval Controls.

The holder of a marketing authorisation must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance, or QPPV, who is responsible for oversight of that system. Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports, or PSURs.

All new MAAs must include a risk management plan, or RMP, describing the risk management system that the company will put in place and documenting measures to prevent or minimize the risks associated with the product. The regulatory authorities may also impose specific obligations as a condition of the marketing authorisation. Such risk-minimization measures or post-authorization obligations may include additional safety monitoring, more frequent submission of PSURs, or the conduct of additional clinical trials

or post-authorization safety studies. RMPs and PSURs are routinely available to third parties requesting access, subject to limited redactions.

All advertising and promotional activities for the product must be consistent with the approved summary of product characteristics, and therefore all off-label promotion is prohibited. Direct-to-consumer advertising of prescription medicines is also prohibited in the EU. Although general requirements for advertising and promotion of medicinal products are established under EU directives, the details are governed by regulations in each member state and can differ from one country to another.

Manufacturing.

Medicinal products may only be manufactured in the EU, or imported into the EU from another country, by the holder of a manufacturing authorization from the competent national authority. The manufacturer or importer must have a qualified person, or QP, who is responsible for certifying that each batch of product has been manufactured in accordance with EU standards of cGMP before releasing the product for commercial distribution in the EU or for use in a clinical trial. Manufacturing facilities are subject to periodic inspections by the competent authorities for compliance with cGMP.

Pricing and Reimbursement.

Governments influence the price of medicinal products in the EU through their pricing and reimbursement rules and control of national healthcare systems that fund a large part of the cost of those products to consumers. Some jurisdictions operate positive and negative list systems under which products may only be marketed once a reimbursement price has been agreed. To obtain reimbursement or pricing approval, some of these countries may require the completion of clinical trials that compare the cost-effectiveness of a particular product candidate to currently available therapies. Other member states allow companies to fix their own prices for medicines, but monitor and control company profits. The downward pressure on healthcare costs in general, particularly prescription medicines, has become very intense. As a result, increasingly high barriers are being erected to the entry of new products.

Foreign Regulation of New Drug Compounds

In addition to regulations in the United States and the EU, we are subject to a variety of regulations in other jurisdictions governing, among other things, clinical trials and any commercial sales and distribution of our products. In particular, we plan to file for regulatory approval in Japan in mid-2018 and in one or more additional countries by the end of the year, and will have to follow the specific regulations in Japan and such other countries, which are complex.

Whether or not we obtain FDA approval for a product, we must obtain the requisite approvals from regulatory authorities in all or most foreign countries prior to the commencement of clinical trials or marketing of the product in those countries. Certain countries outside of the United States have a similar process that requires the submission of a CTA, much like the IND prior to the commencement of human clinical trials. Once the CTA is approved in accordance with a country’s requirements, clinical trial development may proceed. Similarly, all clinical trials in Australia require, among other things, review and approval of clinical trial proposals by an ethics committee, which provides a combined ethical and scientific review process.

The requirements and process governing the conduct of clinical trials, product licensing, pricing and reimbursement vary from country to country. In all cases, the clinical trials must be conducted in accordance with GCP, which have their origin in the World Medical Association’s Declaration of Helsinki, the applicable regulatory requirements, and guidelines developed by the ICH for GCP in clinical trials.

The approval procedure also varies among countries and can involve requirements for additional testing. The time required may differ from that required for FDA approval and may be longer than that required to obtain FDA approval. Thus, there can be substantial delays in obtaining required approvals from foreign regulatory authorities after the relevant applications are filed.

If we fail to comply with applicable foreign regulatory requirements, we may be subject to, among other things, fines, suspension or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.