Finally, the long wait has come to an end. The just announced imminent merger of publicly traded Silence Therapeutics (UK/Germany) with privately held Intradigm (USA) illustrates that consolidation has also arrived in RNA(i) Therapeutics. The stated objective is for the financially strapped firms to achieve a size sufficient to be considered a one-stop partner for a Big Pharma/Biotech (BP/P from now on) interested in RNAi Therapeutics, and also partly in a bid to enlarge their investor base. This approach is in part inspired by the successes of Alnylam and Sirna Therapeutics which had and have been very successful in monetizing their broad approach towards RNAi Therapeutics. While there are factors speaking for such an approach, times have somewhat changed in RNAi Therapeutics such that the established players such as the Roches and Novartis' are more likely to take a pick-and-choose approach in their partnering strategies. As such, companies that are focused on fewer technologies, especially in delivery, but then can get it right, may be preferred partners for these BP/Bs.
On the other hand, for a BP/B that views a platform partnership as a way to start testing the RNAi Therapeutics waters somewhat more extensively, I am thinking here of the likes of AstraZeneca, Boehringer Ingelheim and Aventis, an enlarged Silence Therapeutics may be worth a second look at least as a cheaper alternative to the gold-standard Alnylam Pharmaceuticals. The risk, however, that I see is that ‘broad’ could easily equal ‘lack of depth’.
As much as the desire to grow in size, the merger was driven by the desperate need of both companies. It is therefore highly likely that the merger will be approved as described in the Admission Document, also because of the holidays which makes it unlikely for a third party to make a too-good-to-refuse buy-out offer. Net of debt and after parallel fund raisings from existing Intradigm shareholders (about £5M) and a placing led by Nomura (about £9M), the combined company should soon have ~$20M in liquid assets, which will give the company about a year’s time to find a platform partner that is willing to part with some decent upfront cash. Especially with part of their operations now based in the US, it may also make sense to pursue a listing on the US markets for their future cash needs.
While the claim is to be a broadly positioned RNAi Therapeutics company, the combined company clearly has a strong bias towards cancer. Therefore, an alternative headline of this blog post would have been ‘Silence Therapeutics and Intradigm to Form Cancer RNAi Therapeutics Powerhouse’. It is here that I suspect most of the scientific synergies and value drivers of this merger will come from. I do not have to describe here the high unmet medical needs in cancer, and it is the unique promise of RNAi Therapeutics to go after the many thus far undruggable, yet well-validated cancer-related targets that makes it an area of such high value proposition to the industry. Since nanoparticles can be targeted to cancers, delivery should be possible: e.g. via the tumor vasculature, the Achilles heel of solid cancers, and antibodies to haematological malignancies. In this regard, Silence Therapeutics and Intradigm bring to the table cationic lipoplexes as a means to knock down genes in the tumor vasculature directly (Silence Therapeutics), also as supported by the literature, and a less validated cationic peptide polymer-based delivery technology by Intradigm ('PolyTran').
But will the proposed merger address the one area next to viable delivery that has been nagging both companies in the past...intellectual property? Clearly, combining two comparably weak patent estates do not a strong one make. A quick glance over what is issued and pending, however, suggests that the patent estates could synergize to a certain degree.
Silence (as most others) has been mostly troubled by the Tuschl and Kreutzer-Limmer patents that make it very difficult for them to find dsRNA lengths to exploit their issued Atu-siRNA design pattern without having to to get a license from Alnylam: blunt-ended dsRNAs with alternate 2’-O-methyl modified RNAs. Atu-027 for example, the combined company’s lead candidate for solid cancers that has entered phase I studies this summer, is a 23bp dsRNA and Tuschl I should be a formidable challenge here. Intradigm, like RXi/Invitrogen’s non-Dicer dsRNAs before (rxRNA solo/Stealth), chose to minimize Tuschl-KL problems by opting for a 25bp blunt-end design, and Silence’s alternating 2’-O-methylation pattern IP might give those a proprietary touch. As I cannot find any evidence that Intradigm currently has any access to 25bp structure-specific patents aside from Fire-Mello, I wonder how extensive the siRNA design IP access to the Zamore (University of Massachusetts) patent estate really is. Zamore’s seminal discoveries centered around the thermodynamic properties of effective siRNA, and if added to the 25bp dsRNAs could further endow those with a proprietary look. One issued patent relates to the stability of the guide RNA 3’ end with the target mRNA and which has implications for RNAi catalytic turnover. This one, however, would serve more the purpose of a design-around fig-leaf, and not necessarily represent a means to exclude others. The more important discovery by Zamore, however, is related to differential end stabilities of siRNA duplexes themselves, a basic siRNA rule that essentially everybody in the field follows. If Intradigm had indeed access to such IP, it could give them some leverage over other companies [maybe somebody reading this can provide me/the blog with more information on the extent of the Intradigm-Zamore relationship].
An area where there should be synergies is a broader gene target base in oncology. I had been wary of Silence’s focus on the PI3K pathway which, despite the well-known importance of this pathway in cancer biology, appears to be too closely connected to the history of the R&D staff for comfort and may have caused them to oversee more promising targets. On the other hand, Intradigm has been pursuing a large list of 50 largely cancer-related gene targets, and has obtained a sequence-specific patent on one of those which should give the enlarged work-force plenty to work on. Despite all these genes, after burning through almost $40M and noise around their initial VEGF-directed lead candidate subsided, Intradigm alone would appear to be some a long time from the clinic. With Silence Therapeutics’ Atu-027 and lipoplexes, the new company can boast at least boast one candidate undergoing clinical evaluation and possibly more to come.
In summary, given the bleak alternatives, the merger makes sense. For the field of RNAi Therapeutics, it may also be good to have companies with sufficient size to attract the attention of investors. Long gone are the days that the Alnylam-Sirna rivalry kept attention levels high. There is, however, a lot to be sorted out for the new company before it can gain the hoped-for traction.