Accordance with Terms of Existing Investor Rights Agreement

Accordance with Terms of Existing Investor Rights Agreement

CAMBRIDGE, Mass. -- May 8, 2008--Alnylam Pharmaceuticals, Inc., a leading RNAi therapeutics company, announced today that Novartis has elected to fully exercise its current right to purchase 213,888 unregistered shares of Alnylam's common stock in accordance with the terms of the Investor Rights Agreement between Alnylam and Novartis, dated September 6, 2005.

In connection with the execution of the 2005 License and Collaboration Agreement, Novartis previously purchased approximately 5.3 million shares of Alnylam's common stock at a price of $11.11 per share, which currently represents an ownership position of approximately 13%. Under the terms of the Investor Rights Agreement and upon required notice by Alnylam, Novartis obtained a future right to purchase additional equity securities from Alnylam, subject to specified exceptions, such that Novartis is generally able to maintain its ownership percentage in Alnylam.

Pursuant to terms of the Investor Rights Agreement and in connection with Alnylam's issuance of certain shares of common stock related primarily to stock option exercises during the fiscal year ended December 31, 2007, on April 28, 2008, Novartis elected to fully exercise its right to purchase 213,888 shares of Alnylam's common stock at a purchase price of $25.29 per share, which is equal to the average of the closing prices for Alnylam's common stock for the 20 trading-day period ending on March 28, 2008. On May 8, 2008, Novartis purchased the 213,888 unregistered shares resulting in a cash payment to Alnylam of $5,409,228, and an increase in Novartis' ownership position to approximately 13.4% of Alnylam's outstanding common stock. The exercise of this right does not result in any changes to existing rights or any additional rights to Novartis beyond the terms of the original 2005 License and Collaboration Agreement. Further, during the term described in the Investor Rights Agreement, Novartis is permitted to own no more than 19.9% of Alnylam's outstanding shares.

About Alnylam Pharmaceuticals

Alnylam is a biopharmaceutical company developing novel therapeutics based on RNA interference, or RNAi. The company is applying its therapeutic expertise in RNAi to address significant medical needs, many of which cannot effectively be addressed with small molecules or antibodies, the current major classes of drugs. Alnylam is leading the translation of RNAi as a new class of innovative medicines with peer-reviewed research efforts published in the world's top scientific journals including Nature, Nature Medicine, and Cell. The company is leveraging these capabilities to build a broad pipeline of RNAi therapeutics; its most advanced program is in Phase II human clinical trials for the treatment of respiratory syncytial virus (RSV) infection. In addition, the company is developing RNAi therapeutics for the treatment of a wide range of disease areas, including hypercholesterolemia, liver cancers, and Huntington's disease. The company's leadership position in fundamental patents, technology, and know-how relating to RNAi has enabled it to form major alliances with leading companies including Medtronic, Novartis, Biogen Idec, and Roche. To reflect its outlook for key scientific, clinical, and business initiatives, Alnylam has established "RNAi 2010" which includes the company's plan to significantly expand the scope of delivery solutions for RNAi therapeutics, have four or more programs in clinical development, and to form four or more new major business collaborations, all by the end of 2010. Alnylam is a joint owner of Regulus Therapeutics LLC, a joint venture focused on the discovery, development, and commercialization of microRNA therapeutics. Founded in 2002, Alnylam maintains headquarters in Cambridge, Massachusetts. For more information, visit www.alnylam.com [1].