# How Alnylam makes money

CXProWealth Business Lens · Alnylam (ALNY) · Q3 FY2026

Read from the 10-Q for the period 2026-07-01 to 2026-09-30, filed 2026-10-29 with the SEC (accession 0001178670-26-000076): https://www.sec.gov/Archives/edgar/data/1178670/000117867026000076/

Business Lens explains how a company earns, spends and keeps its money, from its own filings. It is insight and context, never a view on the shares, a target, or advice. Figures are raw units as filed; percentages are percentage points.

## Headline figures

- Revenue: $1.5B (+145.4% on the year)
- Operating income: $345.8M (operating margin 23.7%)
- Net income: $2.2B (net margin 148.6%)
- Gross margin: 75.2%
- Free cash flow: $271.2M (18.6% of revenue)
- Cash conversion (operating cash flow / net income): 0.16x
- Capital expenditure: 4.8% of revenue

## Where the money goes (Q3 FY2026)

- Amvuttra → Total revenues: $1.1B
- Onpattro → Total revenues: $19.6M
- Givlaari → Total revenues: $89.5M
- Oxlumo → Total revenues: $52.5M
- Net revenues from collaborations → Total revenues: $71.5M
- Royalty revenue → Total revenues: $94.7M
- Total revenues → Total operating costs and expenses: $1.1B
- Total operating costs and expenses → Research and development: $408.5M
- Total operating costs and expenses → Selling, general and administrative: $342.0M
- Total operating costs and expenses → Cost of goods sold: $361.8M
- Total revenues → Income from operations: $345.8M
- Income from operations → Total other expense, net: $50.0M
- Total other expense, net → Interest expense: $84.4M
- Interest income → Total other expense, net: $30.9M
- Other income (expense), net → Total other expense, net: $3.4M
- Income from operations → Income before income taxes: $295.8M
- Income before income taxes → Net income: $295.8M
- Benefit from (provision for) income taxes → Net income: $1.9B

## Where the revenue comes from

### Products and services (CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME)

| Member | Value | Share |
|---|---:|---:|
| Net product revenues | $1.3B | 88.6% |
| Royalty revenue | $94.7M | 6.5% |
| Net revenues from collaborations | $71.5M | 4.9% |

The members sum to total revenue.

### Products and services (NET PRODUCT REVENUES - Schedule of Net Product Revenues (Detail))

| Member | Value | Share |
|---|---:|---:|
| Amvuttra | $1.1B | 77.5% |
| Givlaari | $89.5M | 6.1% |
| Oxlumo | $52.5M | 3.6% |
| Onpattro | $19.6M | 1.3% |

The members do not sum to total revenue.

### Regions (NET PRODUCT REVENUES - Schedule of Net Product Revenues (Detail))

| Member | Value | Share |
|---|---:|---:|
| Europe | $130.7M | 9.0% |
| Rest of World | $91.0M | 6.2% |

The members do not sum to total revenue.

### CounterpartyName (COLLABORATIONS - Schedule of Revenue from Collaborators (Detail))

| Member | Value | Share |
|---|---:|---:|
| Roche | $39.1M | 2.7% |
| Regeneron Pharmaceuticals | $32.3M | 2.2% |
| Other | $35.0K | 0.0% |

The members do not sum to total revenue.

## Income statement, as filed

| Line | Q3 FY2026 | Of revenue |
|---|---:|---:|
| Total revenues | $1.5B | 100% |
|   Net product revenues | $1.3B | 88.6% |
|   Net revenues from collaborations | $71.5M | 4.9% |
|   Royalty revenue | $94.7M | 6.5% |
| Cost of goods sold | $361.8M | 24.8% |
| Cost of collaborations and royalties | $0 | 0.0% |
| Research and development | $408.5M | 28.0% |
| Selling, general and administrative | $342.0M | 23.5% |
| **Total operating costs and expenses** | $1.1B | 76.3% |
| **Income from operations** | $345.8M | 23.7% |
| Interest expense | ($84.4M) | 5.8% |
| Interest income | $30.9M | 2.1% |
| Loss related to convertible debt | ($0) | 0.0% |
| Other income (expense), net | $3.4M | 0.2% |
| **Total other expense, net** | -$50.0M | 3.4% |
| **Income before income taxes** | $295.8M | 20.3% |
| Benefit from (provision for) income taxes | (-$1.9B) | 128.3% |
| **Net income** | $2.2B | 148.6% |
| Net income per common share — basic (in dollars per share) | $16 | 0.0% |
| Net income per common share — diluted (in dollars per share) | $16 | 0.0% |
| Weighted-average common shares - basic (in shares) | 133,828,000 |  |
| Weighted-average common shares - diluted (in shares) | 138,040,000 |  |
| **Net income** | $2.2B | 148.6% |
| Unrealized (losses) gains on marketable securities | -$11.8M | 0.8% |
| Foreign currency translation (losses) gains | -$801.0K | 0.1% |
| Defined benefit pension plans, net of tax | (-$89.0K) | 0.0% |
| **Total other comprehensive (loss) income** | -$12.5M | 0.9% |
| **Comprehensive income** | $2.2B | 147.8% |

## History

| Period | Revenue | Operating income | Net income | Operating cash flow | Capital expenditure | Free cash flow |
|---|---:|---:|---:|---:|---:|---:|
| FY2008 | $96.2M | -$27.8M | -$26.2M | $65.5M | $10.8M | $54.7M |
| FY2009 | $100.5M | -$48.1M | -$47.6M | -$72.1M | $4.9M | -$77.1M |
| FY2010 | $100.0M | -$44.1M | -$43.5M | -$84.3M | $4.7M | -$89.1M |
| FY2011 | — | -$54.8M | -$57.6M | -$87.1M | $1.3M | -$88.4M |
| FY2012 | — | -$129.5M | -$106.0M | -$115.6M | $8.3M | -$124.0M |
| FY2013 | — | -$92.9M | -$89.2M | -$68.7M | $4.0M | -$72.7M |
| FY2014 | — | -$405.0M | -$360.4M | -$165.6M | $9.0M | -$174.6M |
| FY2015 | — | -$296.0M | -$290.1M | -$189.1M | $13.0M | -$202.1M |
| FY2016 | $47.2M | -$424.6M | -$410.1M | -$307.7M | $64.6M | -$372.3M |
| FY2017 | $89.9M | -$500.1M | -$490.9M | -$382.8M | $104.2M | -$487.0M |
| FY2018 | $74.9M | -$814.7M | -$761.5M | -$562.6M | $126.9M | -$689.5M |
| FY2019 | $219.8M | -$939.4M | -$886.1M | -$278.4M | $140.2M | -$418.6M |
| FY2020 | $492.9M | -$828.4M | -$858.3M | -$615.0M | $70.4M | -$685.3M |
| FY2021 | $844.3M | -$708.7M | -$852.8M | -$641.7M | $76.4M | -$718.1M |
| FY2022 | $1.0B | -$785.1M | -$1.1B | -$541.3M | $72.1M | -$613.3M |
| FY2023 | $1.8B | -$282.2M | -$440.2M | $104.2M | $62.2M | $41.9M |
| FY2024 | $2.2B | -$176.9M | -$278.2M | -$8.3M | $34.3M | -$42.6M |
| FY2025 | $3.7B | $501.6M | $313.7M | $524.1M | $58.7M | $465.4M |

Latest trend (the newest full year against the year before; a reading, not a forecast):

- Revenue: +65.2% (year before +23.0%): accelerating
- Operating income: -183.6% (year before —): too short a history to read
- Net income: -12.8% (year before —): too short a history to read
- Free cash flow: -992.7% (year before -201.5%): slowing

## Operating figures stated in the filing

- Countries where Leqvio is registered: 109 countries (as of 2026-09-30). "Leqvio has also been approved in China and Japan, and as of the end of September 2026, Leqvio is registered in 109 countries worldwide and is commercially available in 89 countries." (Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS)
- Countries where Leqvio is commercially available: 89 countries (as of 2026-09-30). "Leqvio has also been approved in China and Japan, and as of the end of September 2026, Leqvio is registered in 109 countries worldwide and is commercially available in 89 countries." (Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS)

## Key insights

### A tax release supplied 86.3% of the $2.17B profit

Net income of $2.17B far exceeded pre-tax income of $295.8M, because a $1.87B tax benefit supplied 86.3% of it.

Income before income taxes was $295.8M, up 5.4% from $280.6M a year earlier. Net income was $2.17B, against $292.7M. The difference is a $1.87B benefit from income taxes, which the filing attributes to the “release of valuation allowances on certain U.S. federal and state deferred tax assets”. Diluted earnings per share were $15.72, against $2.14. _(from the filing)_
The benefit is an accounting entry, not cash. Operating cash flow for the quarter was $341.0M, 15.7% of net income, and free cash flow was $271.2M, against $284.7M a year earlier. _(from the filing)_
Releasing the allowance means the company now judges it more likely than not that past losses will shelter future taxable profit: its profit record has become strong enough to change that judgment. Later quarters are likely to carry a tax charge in the income statement, so income from operations and cash flow are the steadier lines for comparing periods across this change. _(analysis)_

### Amvuttra grew 64.9% while operating income fell 6.0%

A Roche milestone in last year's quarter and a rising royalty cost on Amvuttra outweighed product growth, so operating margin fell to 23.7%.

Net product revenues rose 51.8% to $1.29B, and Amvuttra alone rose 64.9% to $1.13B. Total revenues rose only 16.7% to $1.46B, because net revenues from collaborations fell 79.7% to $71.5M from $351.7M. The filing attributes the drop to milestone revenue recognized from Roche in the prior-year quarter, when the first patient was dosed in the zilebesiran outcomes trial. _(from the filing)_
A year earlier collaboration revenue was 28.2% of total revenues; this quarter it was 4.9%. Net product revenues went from 68.1% of total revenues to 88.6%. Meanwhile cost of goods sold rose 83.4% to $361.8M and total operating costs and expenses rose 26.3%, so income from operations fell to $345.8M from $368.0M and operating margin to 23.7% from 29.5%. _(from the filing)_
The decline is a comparison effect more than a weakening of the business. Milestones arrive when trials reach set points and do not recur on a schedule, so the prior-year margin was flattered. The recurring base, product sales and partner royalties, grew much faster than the total suggests. _(analysis)_

### Amvuttra's royalty to Sanofi climbs as its sales grow

Cost of goods sold reached 28.0% of net product revenues, from 23.2%, which the filing attributes to a higher blended royalty rate on Amvuttra.

Alnylam owes Sanofi tiered royalties on global annual net sales of Amvuttra, with higher tiers applying as sales rise, and carries them in cost of goods sold. Cost of goods sold was $361.8M, against $197.2M a year earlier, up 83.4%, while net product revenues rose 51.8%. It took 24.8% of total revenues, 9.0 points more than a year earlier, leaving a gross margin of 75.2%. _(from the filing)_
The company expects cost of goods sold, as a share of net product revenues, to keep rising this year for the same reason. It says no royalties are owed on nucresiran, its next-generation TTR medicine now in late-stage trials, and that it could significantly improve gross margins on product sales, assuming successful development and regulatory approval. _(from the filing)_
This is a cost of success built into the licence: each added dollar of Amvuttra sales carries a higher royalty than the average dollar before it, so gross margin on product sales tends to slip as the drug grows. The structural answer is a successor the company owns free of that royalty, which makes the timing and success of nucresiran a margin question, not only a growth one. _(analysis)_

### Competitive edge

- **Partner royalties now outsell Alnylam's second-largest drug** Royalty revenue of $94.7M, up 104.9%, exceeded both Givlaari's $89.5M and collaboration revenue of $71.5M, earned without Alnylam's own sales force.
- **Research and selling costs grow slower than revenue** Research rose 13.9% and selling, general and administrative 6.2%, against 16.7% revenue growth, so a largely fixed cost base carries more sales.
- **One RNAi platform behind every product and royalty** The same gene-silencing platform produced Amvuttra, Givlaari, Oxlumo and partner-sold Leqvio, taking annual revenue from $74.9M in FY2018 to $3.71B in FY2025.

### What to watch

- **One medicine is 77.5% of total revenue** Amvuttra brought in $1.13B, 87.5% of net product revenues, so its net price, payer coverage and competition now decide most of each quarter.
- **Interest on sold royalties takes a growing profit share** Interest expense rose 25.1% to $84.4M, equal to 24.4% of operating income against 18.3% a year earlier, driven by liabilities tied to sold future revenue.
- **Supply rests on a few outside manufacturers** Contract manufacturers make all of Alnylam's drug product, and new U.S. tariffs and the BIOSECURE Act add cost and supply pressure the filing names.

## Investor view

**Amvuttra is now 77.5% of Alnylam's revenue, and the royalty Alnylam owes on it climbs as its sales grow**

### How it makes money

Alnylam sells RNAi medicines, drugs that silence a disease-causing gene, mostly in the liver. Most of the money comes from products it sells itself: net product revenues were $1.29B of $1.46B in total revenues this quarter, or 88.6%. One drug carries the business. Amvuttra, for transthyretin (TTR) amyloidosis, brought in $1.13B, 77.5% of total revenue. _(from the filing)_
The rest of the product line is small and mixed. Givlaari, for acute hepatic porphyria, sold $89.5M, up 21.1% from a year earlier. Oxlumo, for the rare kidney disorder primary hyperoxaluria, sold $52.5M, down 0.6%. Onpattro, the older TTR medicine, fell 49.9% to $19.6M, which the filing puts down to a decreased number of patients on it. _(from the filing)_
A second stream comes from partners. Royalty revenue, driven mainly by Novartis's sales of the cholesterol drug Leqvio, was $94.7M, against $46.2M a year earlier. Leqvio is registered in 109 countries and commercially available in 89. Collaboration revenue of $71.5M is reimbursed development work and milestones, chiefly from Roche ($39.1M) and Regeneron ($32.3M). _(from the filing)_
The cost side is shaped by a licence. Alnylam owes Sanofi tiered royalties on global Amvuttra sales, carried in cost of goods sold, and the filing says the rise in “the blended royalty rate payable on net sales of AMVUTTRA” lifted cost of goods sold to $361.8M, against $197.2M a year earlier. That is 28.0% of net product revenues, up from 23.2%. _(from the filing)_

### What shifted

Total revenues grew 16.7% to $1.46B, but the mix moved much further than the total. Amvuttra rose 64.9% and gained 22.7 points of revenue share. The filing credits “increased patient demand, mainly in patients with ATTR-CM in the U.S.”, the heart form of the disease, for which Amvuttra was approved in the U.S. in March of last year. Outside the U.S., Amvuttra sold $130.7M in Europe and $91.0M in the rest of the world. _(from the filing)_
Collaboration revenue fell 79.7% to $71.5M from $351.7M, and its share of revenue fell 23.3 points. The filing attributes the drop to milestone revenue recognized from Roche in the prior-year quarter, when the first patient was dosed in the zilebesiran outcomes trial ZENITH. Net product revenues went from 68.1% of total revenues a year earlier to 88.6% now. _(from the filing)_
Income from operations fell 6.0% to $345.8M, against $368.0M a year earlier, and operating margin fell 5.75 points to 23.7%, from 29.5%. Two lines did it: the missing milestone and cost of goods sold, which rose 83.4% and took 9.0 more points of revenue. Research and development rose 13.9% and selling, general and administrative 6.2%, both slower than revenue. Against the prior quarter, operating margin rose from 17.9%. _(from the filing)_
Net income was $2.17B, against $292.7M a year earlier, but almost none of the jump came from operations. Income before income taxes rose 5.4% to $295.8M. The rest is a $1.87B tax benefit from the “release of valuation allowances on certain U.S. federal and state deferred tax assets”: the company now judges that past losses will offset future taxable profit. Diluted earnings per share were $15.72, against $2.14. _(from the filing)_
Cash generation held up while spending on plant rose. Operating cash flow was $341.0M, against $296.9M a year earlier. Capital expenditure was $69.8M, against $12.1M, or 4.8% of revenue. Free cash flow was $271.2M, against $284.7M, an 18.6% margin on revenue. _(from the filing)_

### Risks in the filing

The company says its business depends on sustaining and growing Amvuttra sales, and lists what could stop that: safety, payer coverage and reimbursement, U.S. drug price controls including government price negotiation and most-favored-nation pricing, competing therapies including generic versions of competitors, the number of patients diagnosed, and uninterrupted supply. _(from the filing)_
It names its partners as a dependency. Income from Leqvio, Qfitlia, cemdisiran and zilebesiran outside the U.S. relies on Novartis, Sanofi, Regeneron and Roche, whose sales efforts Alnylam has limited control over, and Novartis can end the Leqvio agreement on short notice. Part of the Leqvio royalty stream was sold to Blackstone, and that part grows if Blackstone's receipts miss a set threshold by a set date. _(from the filing)_
Manufacturing rests on a limited number of contract manufacturers, which make all of its drug product, and on specialized delivery technology that only a few suppliers can produce. The filing also names U.S. tariffs on imported patented pharmaceuticals, in effect since late September, and the BIOSECURE Act's limits on work with certain Chinese suppliers as possible cost and supply pressures. _(from the filing)_
It says it has a history of losses and may not sustain profitability, which it reached for the first time last year. It also carries convertible notes it may need cash to settle or repurchase, and the earlier series is now classed as current debt, due within the coming year. _(from the filing)_
Two of these risks already show in the numbers. The licence cost tied to Amvuttra's success shows in cost of goods sold rising much faster than revenue, and the cost of having sold future royalties shows in interest expense rising faster than interest income. The pricing, patent and competition risks the company names have not yet shown up in reported Amvuttra sales. _(analysis)_

## Founder view: mechanisms

### One delivery method, many medicines

Alnylam's medicines share a core: short interfering RNA carried into liver cells by a sugar-based (GalNAc) conjugate. Once delivery was solved for one target, each new medicine became largely a matter of choosing a genetically validated gene and designing a new sequence. The shared core lowers the cost and risk of each added product, which is how one company can run several rare-disease drugs and license others out. _(analysis)_

### Partner for reach, keep what you can sell

Alnylam sells its rare-disease drugs itself, where a focused specialist sales force can reach the prescribers, and licenses products for mass markets to companies with global reach: Leqvio for cholesterol to Novartis, zilebesiran for hypertension shared with Roche. It takes upfront money, milestones and royalties instead of building a primary-care sales organization. _(analysis)_

### A licence cost that grows with success

Amvuttra's rights came through a licence that pays Sanofi a royalty stepping up with annual sales. At small sales the cost was modest; at today's sales the top tier applies to each added dollar. Alnylam's answer is a successor, nucresiran, that it owns free of that royalty, so the success of the next product resets the cost structure of the franchise. _(analysis)_

### Selling future revenue to fund development

Alnylam sold part of its Leqvio royalty stream to Blackstone and took development funding from Blackstone that is repaid out of the success of vutrisiran (Amvuttra) and zilebesiran. Both brought cash without issuing shares. Both are carried as debt that accrues interest, and the cost rises when the product does well, because the repayments track its sales. _(analysis)_

### A fixed cost base meets a large product

Research and the commercial organization are mostly fixed costs. For years they ran far ahead of revenue. Once one product grew quickly, revenue began to outpace them, and the same organization turned from losses to profits. Each added dollar of sales now needs little added overhead. _(analysis)_

## Member research

Signed-in members read, on the page: what Alnylam's numbers depend on from here, and the playbook behind each mechanism (what needs scale, what transfers, how to test it, the metric that would show it).

## Sources

- Alnylam 10-Q for the period to 2026-09-30: https://www.sec.gov/Archives/edgar/data/1178670/000117867026000076/ (2026-10-29)

Methodology business-lens-1.0 · schema 1.2.0 · run business-lens-2026-11-02 · as of 2026-11-02