Friday, October 12, 2018

AASLD Abstract Continues to Support Promise of ARO-HBV, but with a Twist


Yesterday, Arrowhead revealed the abstract for data on its new HBV RNAi drug candidate to be presented at the big annual Liver Meeting in November (AASLD).  The data continue to support highly potent knockdown of not only the surface antigen (HBsAg), but also other HBV components.

Dose response issues

When Arrowhead announced initial first-in-patient knockdown data from its 3rd generation HBV RNAi candidate ARO-HBV, I found it suspicious for them to only reveal data for the 100mg and 200mg cohorts although more data was available at the time.  Curiously, the new data seem to suggest that there was no apparent benefit from going higher than 100mg in dose, at least when dosed with the current monthly frequency. 

Whether there is significantly worsening safety with increasing dose remains to be seen.

HBeAg positive/negative dichotomy

Similarly (but not as earth-shattering for sure) to the history of a prior HBV RNAi candidate by the company before, ARC-520, however, Arrowhead was able to learn more about its drug candidate as they went along in the study.  In particular, the first dose escalation cohorts (100, 200, 300, and 400mg monthly x3) encompassed a mix of HBeAg positive and negative patients, with 13 out of 16 being HBeAg negative.    

When Arrowhead then decided the last 2 cohorts to be just HBeAg positive, a remarkable increase in drug response was observed: whereas it took the predominantly HBeAg-negative patients 70-90 days to achieve 1.5log reductions in HBsAg, it looks like the pure HBeAg-positive patients only take 30-40 days to achieve the same.

Ergo, the reason why no clean dose response had been seen in the first cohorts is best explained by the fact that they were mixed and at that small cohorts.

Trigger choice likely explanation

ARO-HBV comprises 2 RNAi triggers: one that targets all (intact) HBV mRNA (X trigger) and one that makes sure the surface antigen is hit (S trigger) even in those patients with integrated HBV.  These typically lose the corresponding DNA element targeted by the X trigger during integration.

In the early days of RNAi, there was some controversy about the usefulness of using 2 or more triggers against the same target in terms of knockdown potency and specificity.  When I first started to practice RNAi in the lab in 2003, it was my experience that when you combined a very potent trigger with a less potent one, the knockdown was less than with the highly potent one alone.  As a result, I am a firm believer in the concept of RNAi trigger competition.

In the case of ARO-HBV it means that in HBeAg negative patients that have lost the X-trigger DNA, there will be one sterile/inactive trigger somewhat blunting the potency of the active one.

HBV biology is certainly complex and downstream events could also account for final knockdown differences.  Accordingly, in the HBeAg-only cohorts  it appears from the early observations that the nuc-experienced patients that in previous studies corresponded to patients that had lost the X-trigger-targeted elements by study enrollment not only responded as well, but in fact slightly better than the nuc-naïve patients.  It will therefore be important to learn more about their HBV integration status at AASLD to confirm or disprove the competition theory.

Wednesday, October 10, 2018

Review of Recent RNAi-Related Developments


The last 2 weeks have been busy ones in the lands of RNAi Therapeutics.  Here, I would therefore like to offer my take on the most important developments.

Alnylam’s Primary Hyperoxaluria Drug Breezes Through Clinic

With 20 subjects on Lumasiran, a GalNAc-RNAi targeting glycolate oxidase, for a median of 7 months, the investigational treatment for type I primary hyperoxaluria (PH1) ismore and more looking like a solid drug.  If the data presented last week at a Paediatric meeting in Turkey hold up in another 30 patients, it should fly through approval onto the market by the end of 2019.

While the relatively small numbers in each cohort has caused a bit statistical noise, it seemed like 3mg/kg monthly gives you an advantage over 1mg/kg monthly or 3mg/kg monthly in terms of the key biomarker urinary oxalate.  Interestingly, the company has chosen 3 times 3mg/kg monthly as the loading dose regimen in the now ongoing pivotal ILLUMINATE-A trial to be followed by dosing every 3 months. , the initiation of which the company has just announced.    

The core double-blind portion of the trial runs for only 6 months, so I am a bit puzzled how much the trial can inform on the value of the loading dose regimen and whether quarterly maintenance doses are sufficiently effective.   In any case, the trial design apparently was blessed by the FDA (incl. the urinary oxalate lowering primary endpoint), so surely they will know (e.g. based on preclinical animal data).

Regarding the competition with the primary hyperoxaluria drug candidate from Dicerna, the approximately 2/3 lowering of urinary oxalate and essentially all patients getting into a range considered safe and an unremarkable safety profile sets a high hurdle for the upcoming data presentation of DCR-PHXC at ASN later this month.

Arbutus HBV-RNAi Drug About to Die   

Yesterday, Arbutus provided an update on its LNP-enabled RNAi drug candidate for the treatment of chronic HBV (ARB-1467) and it does not bode well.  Similar to most other drug candidates attempted and barely tried, ARB-1467 should be canned in the not-too-distant future. 

In a combination study testing ARB-1467 in chronic HBV patients on nucleoside reverse transcriptase inhibitor tenofovir, probably only 1 in 6 patients hit a pre-defined criteria in terms of HBsAg lowering that would allow the patient to then receive immune booster PEG-Interferon.  The not very forthcoming revelation and the fact that the data was mentioned even after dropping another shoe that its small molecule HBV RNA destabilizer is also biting the dust makes it clear that not even the company sees much value in ARB-1467.

What an utter disaster this company has been since its inception as a HBV solutions entity.

Arrowhead Early HBV Deal Further Validates

Last week, shareholders in Arrowhead Pharmaceuticals got a lesson in biotech investing as it shares have given up ~1/3 of its value following a nice deal with Johnson&Johnson for the leading HBV knockdown asset in the space, ARO-HBV.

The deal gives Arrowhead a solid $250M in financing, including a $175M upfront fee and a $75M investment in company stock at a premium of ~50% to current trading.  While this avoids an imminent dilutive secondary share issuance- the company had been running low of cash- the ‘up to 15%’ in royalties from future sales of early phase II-stage ARO-HBV is clearly disappointing.  The relatively low royalty despite of it having confirmed strong HBsAg knockdown in patients can be explained with the fact that Arrowhead has avoided bearing the full risk of having to show proof-of-concept of HBV control.  This despite of having earlier paraded results obtained with an earlier DPC-based RNAi candidate (ARC-520) as strong evidence that RNAi can achieve such immune control.

While Arrowhead got punished for playing it safely, it can now focus on commercial home-run indications with highly validated targets and transition to being a broad platform company with a wholly owned attractive lead candidate in ARO-AAT.  Indeed, Arrowhead may emerge as the leading RNAi company as Alnylam, with a market cap ~8x that of Arrowhead, is still burdened by late-stage RNAi drugs with suboptimal specificity.

While humiliating, this serves Alnylam as a good reminder to also value innovation by the direct competition (note: specificity-enhancing technology now adopted by Alnylam has been available for a decade and could have been had for peanuts, e.g. from now defunct RNAi play mdRNA/Nastech).  Fittingly, today long-time archrival Silence Therapeutics issued a press release indicating that Alnylam is playing hard-ball with regard to Silence-owned IP purportedly covering ONPATTRO.

My guess is that Alnylam would rather risk an injunction and deprive patients of a very good medicine than to submit to what appear to me legitimate demands of a competitor.


Akcea’s antisense drug for TTR amyloidosis gets FDA nod

Last Friday, Akcea’s TTR drug TEGSEDI (licensed from Ionis) finally got FDA marketing approval for patients suffering from TTR-related polyneuropathy.  As expected from the delay in the approval process, TEGSEDI’s approval is accompanied by hefty black box warnings highlighting thrombocytopenia and renal risks of the (non-GalNAc) phosphorothioate oligonucleotide.  

Furthermore, the REMS program calls for frequent blood monitoring, essentially negating the claimed at-your-home convenience advantage over competing RNAi drug ONPATTRO.  Add to the poor safety profile clear efficacy disadvantages and pricing at parity with ONPATTRO, ONPATTRO should clearly win out in the marketplace.

Having said that, the TTR community is relatively small and key opinion leaders with relationships to a given drug company tend to support the drugs from the same company.

Friday, September 28, 2018

Another Second-Generation GalNAc-RNAi Rocked by Off-Target Concerns


With the approval of ONPATTRO and the current overall clinical picture, in particular the highly encouraging safety profile seen with PCSK9-targeting Inclisiran in well over a 1000 subjects (à The Medicines Company and Alnylam), the RNAi mechanism can be considered a clinically validated  new drug modality. 

Liver enzyme elevations, however, have been seen across a few clinical programs.  This includes ALN-AAT for alpha-1 antitrypsin-related liver disease, ALN-AT3 for hemophilia, and now also Givosiran (ALN-AS1).  The most likelyreason for these observations is that the minimization of off-targeting had been neglected for these ‘2nd-generation GalNAc-RNAi triggers’, thereby raising the risk that the relatively high off-target noise (dozens of off-targets) can be detrimental to target cell health. 

To wit, the spectrum of off-target genes varies tremendously from RNAi trigger sequence to RNAi trigger sequence and affects biologically unrelated genes.  This makes it very hard to predict whether the off-target noise will have adverse effects or will be just irrelevant noise to the cell.  Not helping is the fact that lab animals due to their genome sequence differences cannot model the safety around off-targeting.  The hope is that perhaps organ explants or mice with humanized organs (e.g. humanized mouse livers) will be better predictors since the target cell is almost the same as in the clinical setting.

Marked liver enzyme elevation in Givosiran pivotal trial

This week, Alnylam provided an interim read-out from the ENVISION trial, the registrational study with GalNAc-siRNA Givosiran for acute hepatic porphyria (AHP).  AHP is a rare disease caused by defects in heme synthesis.  This results in the accumulation of toxic intermediates such as PBG and ALA which can cause a range of symptoms, including severe pain attacks.

The study envisioned an interim biomarker read-out in a first cohort of patients that had been treated for at least 3 months with study drug.  It had been agreed before with the FDA that if lowering of ALA could be found in this read-out, it might form the basis for an accelerated approval.

Unsurprisingly, urinary ALA levels were reported to be statistically significantly lower in patients treated with Givosiran compared to placebo- in-line with the phase I/II experience (p<0 .001="" span="" style="mso-spacerun: yes;"> 

Unfortunately, there were numerically more than twice as many Givosiran-treated sujects (5/23) that experienced a serious adverse event (SAE) than in the placebo group (2/20).  One of the Givosiran-treated subjects had to discontinue treatment due to liver enzyme levels above the pre-specified threshold (>8x upper limit of normal).  While no liver enzyme elevations had been reported in a similar number of patients in the earlier-stage studies, I wished the company could have talked more about the presence of other liver enzyme increases of less than 8x ULN to get a better sense of the magnitude of the problem and whether such incidence would be compatible with giving the drugs in a chronic fashion.

Having said that, with 5 SAEs in 23 subjects treated a little more than 3 months on average (on top of a case of drug-related anaphylaxis in the phase I/II open-label extension study), SAEs that might be drug-related, would already seem to invalidate Givosiran being used in those with the same genetic condition, but not necessarily with recurrent pain attacks.  This would have tremendously extended the market opportunity of Givosiran.   

In the same vein, with the present safety questions, an accelerated approval that would shave off a few months before the full dataset will be available in early 2019, can now be ruled out with high certainty.

To add insult to injury, Akcea reported earlier this week that a GalNAc-version of the competitive RNaseH antisense technology did not suffer from thrombocytopenia as unconjugated ASOs typically do, thus putting ASOs back in the race for liver targets.  Still, in the long-term and in particular with the more specific new GalNAc-RNAi trigger chemistries, RNAi should win for most liver targets, but for some targets where either RNAi has inherent difficulties achieving high potencies or in cases where off-targeting toxicity still strikes (albeit at a much lower rate), RNaseH ASOs may emerge victorious.

Disclosure: long ALNY, but have taken some off the table following these data and questions around cardiac issues with ONPATTRO; it is important now for Inclisiran to re-instill confidence in the safety of RNAi Therapeutics; short AKCA as I do not believe that their current TTR and triglyceride-lowering drugs TEGSEDI and WAYLIVRA, respectively, can be commercially successful drugs and its artificially bloated market cap is a result of the low float and short interest in this stock and not a reflection of the value that the market sees in Akcea.

Monday, September 10, 2018

Second-Tier RNAi Therapeutics Companies Starting to Deliver Clinically


Alnylam has had a 3 year head-start on the competition with GalNAc RNAi Therapeutics, but now additional companies are populating the field with actual clinical data.  While the knockdowns appear robust and the chemistries well tolerated, therapeutic utility and the potential of liver toxicity from off-targeting will have to be demonstrated in upcoming longer-term studies.

Dicerna clinically validates new target for primary hyperoxaluria

Dicerna used to be the leader in applying RNAi Therapeutics to primary hyperoxaluria (PH), an orphan genetic condition caused by dangerously high levels of oxalate in the blood.  Oxalate crystallization and deposition may then poison first the kidneys and then various organs leading to premature death.  Unfortunately, as its old LNP technology proved to be impractical, Alnylam's directly competing program targeting glycolate oxidase (GO) assumed the lead.

When Dicerna then came up with a GalNAc-based follow-up candidate (DCR-PHXC), it also chose a new target: hepatic lactate dehydrogenase (LDHA), a target which may have be applicable also for forms of PH beyond the most frequently diagnosed PH1 and for which GO is a suitable target.  Cynics may suspect that the new target was not chosen because it is the better one, but in an effort to provide differentiation over more advanced competition.  To wit, first-mover advantage can be significant in the orphan drug arena.

Perhaps due to its long-standing, deep relationship with the PH community, Dicerna has been able to recruit patients more quickly than I had suspected (in light of Alnylam's parallel recruitment efforts) in its first-in-patient study.  First data from this study (PHYOX) were revealed last week.  To their relief, LDHA knockdown resulted in oxalate lowering in all 9 subjects (8 PH1, 1 PH2) tested.

Following a single-dose of either 1.5mg/kg or 3.0mg/kg, at least 30% reductions in urinary oxalate were seen and all or almost all subjects got to urinary oxalate levels at or below 1.1mmol/24hrs/1.73m2, a level predictive of end-stage-renal-disease freedom.

More detailed data will be presented later this year where we will get a better sense in how the results stack up with those of Alnylam.  Earlier this summer, Alnylam reported 64% mean urinary oxalate reductions relative to baseline before following more than one dose.  Another area of concern is that it appears that 3 out of the 9 injections resulted in injection site reactions (ISR).  To see ISRs is not surprising per se, but the frequency appears to be on the high end based on early experience and could be a competitive disadvantage.  Similarly, no word was said about liver enzymes.

Given that Dicerna has been rushing the PHYOX trial without so much as testing multi-dose regimens, I expect the regulatory agencies to demand at least 2 dosing schemes in the upcoming pivotal trials.  A nightmare scenario would see Dicerna being sent back to phase II to test the safety of multi-dosing, a fate that Regulus Therapeutics had suffered before in Europe.

Disclosure: Over the last few months, I have been largely playing the volatility of DRNA- both on the long and short side.  Looking ahead to the end of the year, I would be hesitant of taking a substantial long position due to a market cap approaching $1B with the potential of negative surprises both on safety and efficacy when more detailed PHYOX data will be presented.  On the other hand, a deal (such as on the IND-ready mystery candidate) could provide a catalyst to the upside at least in the short-term.

Arrowhead sees best HBsAg knockdowns so far with new GalNAc candidate

When similar to Dicerna Arrowhead had to retool its lead programs with the GalNAc technology, one question was whether they could achieve knockdowns as potent as with DPC delivery which employed explicit cell penetrating chemistries.  It was therefore cause for celebration when the company reported -2log HBV surface antigen (HBsAg) knockdowns at the World Gastroenterologists Summit, better than with ARC520 and ARC521 before (slides here).  Also, the knockdown was observed regardless of e-antigen status, but that was to be expected with the new sequence design.

Intriguingly, following 3 monthly injections, the knockdown curves still kept coming down, making it almost look like HBV can be beaten into submission by the knockdown effect alone and without the help of an immune boosting effect.

Unfortunately, only HBsAg results from the 100mg and 200mg monthly dosing cohorts were disclosed even though the company had dosed 9 other dosing and patient cohorts.  Based on cohorts 8-11, it appears that best results may in fact have been obtained with the 300mg monthly regimen which will probably be disclosed in the run-up to this year’s AASLD meeting.

Similar to Alnylam in 2014, after showing impressive RNAi target knockdowns in the clinic, the wait is now on to show that the knockdowns will translate into therapeutic benefits.  Given the speed of the company’s execution in general, I would expect pertinent data to emerge from the HBV program in late 2019/early 2020.

Disclosure: similar to Dicerna, I have been recently playing the volatility of ARWR stock, getting long as it had been consolidating around the $14 level, then selling and going short into last week’s 50% spike to a $2B market cap.  With the puts I then sold ($21 and $20 September strikes), I have a ~10% cushion should the stock zoom past $21 by the September options expiration and my max gain is ~13%.  This is intended as a short-term trade


Monday, August 13, 2018

RNAi Therapeutics Now a Commercial Reality


Last Friday, Alnylam received notification from the US Food and Drug Administration (FDA) that ONPATTRO (aka Patisiran) has been approved for the treatment of hATTR-related polyneuropathy.  This marks the culmination of an almost picture-book translation of a brand-new biotechnology into therapeutic reality.  20 years from worms to patients is nothing.

ONPATTRO development path

Much has been made in the press about the great uncertainty, reflected in supposedly unusually long timelines, of whether RNAi can be a therapeutic modality at all.  Of course, the challenges of delivering RNAi triggers in WoMan, staving off unwanted innate immune responses, and the question of how the transcriptional noise stemming from slightly modulating dozens of unrelated targets will affect safety were all daunting at the beginning.

But looking back, with the exception of a 2-3 year delay due to having to change from an insufficiently potent LNP chemistry to the MC3 lipid-based LNP underlying ONPATTRO and having to institute steroid pretreatment to minimize ‘infusion reactions’, all these challenges more or less dissolved in the development path of ONPATTRO.

A special shout-out here to Ian MacLachlan and his team at formerly Tekmira for solving the critical delivery challenge first.

A best-case scenario would therefore have seen an approval in 2015-6.  2018 is therefore not that bad at all.  Here a quick run-down of the milestones leading up to the approval:

1998: discovery of double-strand RNAs (dsRNAs) being the trigger for RNAi in worms

2001: finding that RNAi can be triggered in WoMan by short dsRNAs

2002: first demonstration of RNAi in mice

2005: first therapeutically relevant demonstration of RNAi in monkeys

2009: initiation of first clinical trial of first-generation LNP-RNA (SNALP-ApoB, aka PRO-040201; ALN-VSP02)

2012: start of ONPATTRO clinical development

2012: first solid clinical proof-of-concept for RNAi in WoMan from ONPATTRO phase I study

2012: start of ONPATTRO phase II study

2013: start of ONPATTRO phase III study (APOLLO)

2017: positive data read-out from APOLLO

2018: EU and US marketing approvals for ONPATTRO  


ONPATTRO is just the beginning

Since ONPATTRO had been conceived starting about a decade ago, there has been, of course, considerable progress in RNAi trigger design (safety, efficacy) and (conjugate) delivery technologies.  As a result, a slew of other RNAi drug candidates by Alnylam, including Givosiran for Acute Intermittent Porphyria (likely 2019 approval), Inclisiran for cardiovascular disease (likely 2020 approval), and Lumasiran for primary hyperoxaluria (likely 2020 approval), are about to be approved.  Especially with the adoption of off-target-minimizing chemical modifications, I am confident that the success rate of RNAi drug candidates for tissue types for which delivery is robust will only increase.

After the liver, for which the current crop of marketing candidates is the target organ, the CNS should be the next huge opportunity as Alnylam gears up to bring a first candidate into that organ over the next year.  In addition, Arrowhead Pharmaceuticals and Alnylam have also started to talk about opportunities in the lung and cancer, although here I am still hesitant about whether these are near-term clinical opportunities or something that will have to wait another 3 years or so.

RNAi shatters antisense competition

As the world is abuzz about the first full-blown marketing approval of an RNAi Therapeutic (note: formal marketing authorization in the EU is still pending), I would be remiss not to display a key graph illustrating the power of RNAi gene silencing versus competing approaches such as gene silencing by mass action RNaseH antisense (TEGSEDI by Akcea Therapeutics) and trying to keep bad proteins from acting out with small molecules (generic tetramer stabilizer diflusinal):  






If you were diagnosed with TTR amyloidosis and had an average life-expectancy of 2-5 years, which treatment would you like to be on?

Stock market reaction

When Alnylam opens for trading today, it will likely be down due to disappointment that the FDA label, unlike the anticipated case in the EU, will only specify TTR-related polyneuropathy for which the APOLLO study had been designed, and not cardiomyopathy with none of the exploratory cardiomyopathy data from APOLLO included.  While this is somewhat disappointing in light of biomarker-based accelerated approvals of Eteplirsen in DMD where target modulation and therapeutic hypothesis were enough to win the day, this should only be a minor hiccup in the overall history of RNAi Therapeutic.  In light of the recent Pfizer small molecule Tafamidis cardiomyopathy data, it is very likely that RNAi trials will show a benefit for cardiomyopathy symptoms as well in a dedicated study (à ALN-TTRsc02). 

Until then, it is possible that the cardiomyopathy data are being withheld until Alnylam and the FDA can come up with a way to include those in an amendment, or as part of an accelerated approval submission.  It is also likely that TTR patients will now more readily be referred from cardiologists to neurologist for an intense neuro check-up such that primary cardiomyopathy patients can access ONPATTRO (and get paid for it) at the slightest signs of polyneuropathy.

Thursday, August 9, 2018

TEGSEDI worse than tetramer stabilizer according to newly released EMA document


When Ionis presented data from the phase III NEURO-TTR study last year in Paris, they clung to numbers close to ‘zero’ to make the point that its TTR-lowering antisense drug TEGSEDI (aka inotersen) was 'stabilizing' and ‘halting’ disease progression.  According to a newly released document by the European Medicines Agency (EMA), this, however, does not seem to be truthful: TEGSEDI only delayed the progression of polyneuropathy compared to placebo, but patients on placebo still got worse over the 15 month study period.   

This not only widens the apparent distance in therapeutic efficacy between TEGSEDI and RNAi competitor ONPATTRO (which improved on disease parameters), but even puts it apparently behind generic tetramer stabilizer diflusinal.  Diflusinal also happens to be much better tolerated than TEGSEDI which has been plagued by platelet and renal issues.

EMA document suggests numbers were inflated

According to the ‘Summary of Product Characteristics’ document issued by EMA following its approval of antisense drug TEGSEDI for the treatment of TTR-related polyneuropathy, mNIS+7 after 15 months increased by +11 points vs 25 points for placebo.  By contrast, Ionis Pharmaceuticals (which has now licensed the drug to subsidiary Akcea Therapeutics) claimed a mere +5 point progression.  Curiously the placebo values haven’t changed.

This compares to an increase of +9.2 for diflusinal over 24 months and -6 for ONPATTRO over 18 months.

Similarly, on another measure of disease progression, the Norfolk Quality of Life questionnaire increased by only +0.99 per the Paris presentation last year, but by +4.38 per the EMA document.  Once again, the placebo numbers remained essentially the same.

Finally, what had been heralded as a TTR knockdown close to that of ONPATTRO, a median 75-79% TTR reduction vs 82% for ONPATTRO, now looks much different when considering that mean knockdown was only 68-74%, possibly reflecting the poor tolerability profile of TEGSEDI and missed doses.

I am sure that Akcea and Ionis will have eloquent explanations for the discrepancies which just so happens to  conveniently and selectively favor their drug when analyzed by them.  These new numbers, however, are not just minor adjustments, but represent substantial changes to the TEGSEDI narrative.

It should be noted that it is likely that tetramer stabilizers and TTR-lowering agents will be taken together by many patients.  The relative efficacy and tolerability numbers, however, put TEGSEDI in a very weak position with regard to direct competitor ONPATTRO, also as it comes to reimbursement decisions. 

ONPATTRO heart aches

In the phase III APOLLO study, patients treated with ONPATTRO were numerically less likely to die compared to those on placebo (~50% reduction in death rate).  Following the Paris meeting, I came away with the impression that the deaths in the ONPATTRO arm were largely due to cardiac failure and infection.

According tothe New England Journal of Medicine publication on the study, this seems to be a misunderstanding as infection was a main cause of death in the placebo arm while all deaths in the ONPATTRO arm were cardiac.  As has been pointed out by others on Twitter (@ionisdisrupts and @artkrieg), this could raise questions in the minds of regulatory bodies whether to include TTR cardiomyopathy applications on the label despite of ONPATTRO improving on related secondary endpoints.

In fact, considering that the recent study design agreement with the FDA for follow-up drug ALN-TTRsc02 also focuses on polyneuropathy endpoints, it is all but official that the label for the upcoming approval of ONPATTRO will be targeted at the polyneuropathy population only and that separate trials will have to address the patients mainly suffering from cardiomyopathy symptoms.

Disclosure: short AKCA, long ALNY.

Friday, August 3, 2018

Taking Stock of RNAi Therapeutics


Though currently vacationing, this summer is starting to get quite busy for the RNAi Therapeutics space, so I thought a quick update summary might be warranted.

RNAi Therapeutics on the eve of commercialization

Following a positive opinion by the CHMP in the EU and an upcoming US decision next week, preparations for the first commercialization of an RNAi Therapeutics, ONPATTRA (aka Patisiran) are in full swing.

The financial markets are full of worry that the label could be a narrow one for ONPATTRO, mainly focusing on the polyneuropathy manifestation of TTR amyloidosis that has been the primary focus of the phase III APOLLO study.  While this is to be taken for granted given the trial design, since many TTR patients have overlapping polyneuropathy and cardiomyopathy symptoms and given the strong cardiomyopathy secondary endpoint data in APOLLO, it has been voiced again and again by physicians at last years European ATTR meeting that patients will be put on an TTR lowering therapy at the slightest indication of cardiomyopathy.

Interestingly, this label worry has had no impact on Akcea’s stock marching to a $3B market cap despite the antisense competitor TEGSEDI clearly having inferior efficacy and a worrisome safety profile.  The choice is: ‘for the convenience of an at-home needle injection (mind you, you'd still have to go to the doctor's office frequently for safety check-ups), do you want to have something that is likely to only delay disease progression instead of reversing it and that might even shorten your life expectancy versus prolonging it if you did nothing?  To help you make this decision, be reminded that your life expectancy from diagnosis is around 5 years.’

Market uptake among cardiologists should also be a catalyzed by the Pfizer tetramer stabilizer Tafamidis data later this month.  Following news that Tafamidis had a positive impact in a phase III trial geared towards the cardiomyopathy symptoms, Alnylam's share price took a hit.  By contrast, the impact on ONPATTRO commercialization should be positive if the upcoming data presentation shows a mere disease stabilization for Tafamidis given that ONPATTRO has clearly beaten Tafamidis in polyneuropathy (there is no reason to believe a priori why cardiomyopathy should respond differently to tetramer stabilizer vs TTR knockdown).  Ultimately, increased awareness of TTR-targeting medicines in the cardiology community by players like Pfizer should only help ONPATTRO commercialization there.

Importantly, the star medicine among this new crop of TTR drugs, GalNAc-based TTRsc02, is on track to start a 9-month pivotal phase III study by the end of year and a cardiology-focused trial shouldn’t be far behind.  

Onwards and upwards RNAi.

Disclosure: long Alnylam as the clear value play in Oligonucleotide Therapeutics these days with a number of significant catalysts in the back half of the year, especially over the next month; short Akcea since not only do their most important medicines, TEGSEDI and WAYLIVRA, s.ck in terms of safety/efficacy, the revenues of their medicines has to be shared with Ionis, Novartis, and now also PTC Therapeutics.  One would therefore have to multiply their market cap by a factor of 3 or so (--> ~$9B) for comparison purposes with more typical biotech market caps.

Amgen misleading secrecy around AMG-890

Not only would Akcea have to share revenues for its most exciting drug candidate, a GalNAc-targeted Lp(a)-antisense in phase II, with Novartis, it now has serious and likely superior RNAi competition in the guise of AMG-890.  To wit, the rights to GalNAc-RNAi AMG-890 were licensed 2 years ago from Arrowhead Pharmaceuticals to Amgen and despite it having been the lead GalNAc-RNAi candidate at Arrowhead until then, HBV and AAT candidates by Arrowhead seem to have beaten AMG-890 to the clinic by a year or so.  This and the early trial termination of the ARO-AAT trial in my mind raised serious concerns that Arrowhead was willing to take far more risks with its current technology than Amgen wanted to, raising questions over the general quality of the Arrowhead pipeline in light of their otherwise amazing execution speed.

Now that Amgen has disclosed that they must have filed the AMG-890 IND/CTA-equivalent months ago, but already dosed their first subject with it, more positive interpretations are warranted.

Disclosure: Since the Arrowhead cult has attacked me on my stock trading potentially influencing my view of their technology, here a more detailed summary of my trading strategy: I started pursuing a ‘covered short’ strategy following the strong run-up in the wake of the ARO-AAT early termination and first knockdown data news releases (July puts expiring worthless, then writing new puts for August and September largely in the $14-16 range) and consider myself lucky to have covered my short on the stock route from $17 to $12.5 last Friday and this Monday leaving me short a bunch of puts.  As Arrowhead has strongly rebounded from the sell-off, I have been gradually re-shorting it starting from the ~$14.5 level to lock in some of the windfall profits; by now, the short covers ~1/3 of my puts (note: ‘covered short’ is actually a misnomer as the short portion of the trade could still bankrupt you).

RXi biting the dust no matter the (ocular) data

Self-delivering RNAi Therapeutics company RXi Pharmaceuticals reported encouraging data this week from a small study of anti-scarring candidate RXI-109 for retinal scarring.   In important news to the RNAi Therapeutics space at large, no serious drug-related adverse events were seen with these highly modified oligonucleotides.  On the efficacy side, numerical improvements were seen over placebo, but clearly need to be regarded as preliminary.

For a sub-$10M market cap company, such news should have strongly propelled the stock under normal management.  In this case, the clinical results look like a mere note on their way to impending bankruptcy.  It is a timely reminder that the number 1 job of a CEO is actually investor relations and making sure adequate capital is available when needed.  It seems like RXi’s CEO has believed that operational execution is all that was needed and that investment funds will start knocking on their door.  This was a serious miscalculation, especially since after the split from CytRx, a biotech that many would consider a scam, the entire pre-existing financing mechanics (I spare you the gory mechanics) of RXi fell away.

Disclosure: I hold a small long position in RXII (<1 a="" and="" be="" been="" believe="" bit="" company="" course="" different="" it="" management.="" more="" much="" of="" portfolio="" s="" should="" span="" style="mso-spacerun: yes;" technology="" the="" under="" value="" valued="">  I cannot, in good conscience, recommend this stock as a buy under current circumstances.

 Note: a proof-read version with links will follow as time permits.

By Dirk Haussecker. All rights reserved.

Disclaimer: This blog is not intended for distribution to or use by any person or entity who is a citizen or resident of, or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would subject the author or any of his collaborators and contributors to any registration or licensing requirement within such jurisdiction. This blog expresses only my opinions, they may be flawed and are for entertainment purposes only. Opinions expressed are a direct result of information which may or may not be accurate, and I do not assume any responsibility for material errors or to provide updates should circumstances change. Opinions expressed in this blog may have been disseminated before to others. This blog should not be taken as investment, legal or tax advice. The investments referred to herein may not be suitable for you. Investments particularly in the field of RNAi Therapeutics and biotechnology carry a high risk of total loss. You, the reader must make your own investment decisions in consultation with your professional advisors in light of your specific circumstances. I reserve the right to buy, sell, or short any security including those that may or may not be discussed on my blog.