Thursday, June 19, 2008
Alnylam Starts Monetizing RSV Drug Candidate, but Keeps Options Open
Earlier this year, ALN-RSV01 has demonstrated proof-of-concept antiviral activity in an experimental infection model in healthy adult volunteers. This deal therefore comes at a reasonable value inflection point for the drug. Since the Asian rights for ALN-RSV01 were explicitly excluded from the platform licensing deal with fellow Japanese company Takeda, last month, today’s announcement may not come as a surprise to some observers. However, it shows that, supported by the strength of the RNAi platform, IP, and know-how, Alnylam management has executed on yet another strategic corporate goal. The exact timing may have to do with the convenience of signing contracts while assembled at the BIO, by the way taking place not too far away from where not only Kyowa Hakko’s parent company Kirin, but also Takeda have US operations, but possibly (pure speculation) also with the achievement of some clinical milestone (patients dosed in the current lung transplant trial etc.).
Importantly, while Alnylam is thus starting to monetize ALN-RSV01 thereby lowering the risk that its broad RNAi Therapeutics platform may be unduly predicated on this first-generation RNAi Therapeutics candidate, this arrangement leaves Alnylam almost all options open with regards to ALN-RSV01. It leaves them with the clinical development responsibility which is a good thing for a company that aims to become a vertically integrated drug company and, despite its young age, may be the best to shepherd such an RNAi drug candidate through clinical development due to its intimate familiarity with the technology. On the other hand, should one of Alnylam’s upcoming programs for hypercholesterolemia, liver cancer or Huntington’s Disease, show even more promise than ALN-RSV01 early on in the clinic, Alnylam may decide to lower their exposure to ALN-RSV01 through further partnering, potentially on even more lucrative terms following results from ongoing phase II studies. If not, Alnylam may decide to invest more and thus retain most of the rights to ALN-RSV01 for itself.
The terms of the agreement are very favorable indeed and illustrate the virtue of developing innovative therapeutics based on novel mechanisms of actions for diseases of high unmet medical needs- one of the attractions of RNAi Therapeutics. By this, even programs that may ultimately fail in the clinic could actually pay for themselves. The deals just keep coming, and it is only a question of time until even Wall Street realizes that as Alnylam starts paying taxes on the resulting profits, that this is actually part of a sustainable business strategy.
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