Thursday, July 29, 2010

Marina Biotech Continues to Drive Sector Consolidation, Acquires Novosom’s Liposomal Delivery IP

Marina Biotech, formerly known as mdRNA, continues to snap up assets in the oligonucleotide therapeutics and diagnostics space, this time acquiring the liposomal delivery IP from Novosom, a privately held drug delivery company based in Germany. This comes only a week after shareholders approved mdRNA’s merger with tkRNAi company Cequent Pharmaceuticals to form Marina Biotech. It will be curious to see whether Marina’s strategy of challenging Alnylam's industry-leading position by taking advantage of the depressed market for oligonucleotide therapeutics will succeed in luring Big Pharma and pay off for shareholders. The investment this time: $5M in newly issued stock.

Similar to Silence Therapeutics, Marina acts on the premise that in order to capture those lucrative partnerships, being able to provide a choice of delivery technologies, plus some claims in RNAi triggers, too, is key. This, of course, is in contrast to Tekmira’s so far quite successful strategy of doing one thing very well, meaning clinically maturing and expanding the applicability of its industry-leading SNALP delivery technology and avoid some of the deal frenzy and dilution of effort.

By the looks of it, Novosom has to be considered one of the more bona fide delivery companies. Similar to Tekmira’s SNALP, Novosom’s SMARTICLES can change their surface electrical charge and therefore reconcile (serum and storage) stability with endosomal release functionality. Unlike SNALPs, however, these liposomes also contain anionic lipids, in addition to cationic and neutral lipids, and do not employ PEG stabilizers. This stability can be attributed to the negative charge of SMARTICLES at phyisiologic pH which ought to avoid various interactions with host factors and resulting toxicities often associated with positively charged lipids. However, as the pH acidifies upon endosomal uptake of these particles, they become positively charged and competent for membrane disruption and cytoplasmic release. For similar reasons, ionizable SNALPs as practiced by Tekmira not only employ PEGylation, but are also essentially uncharged at physiologic pH.

In terms of IP, from the looks of it, Novosom has assembled a respectable IP estate with various fairly broad patents granted also in the important US market. This should provide Marina with considerable options to leverage its other liposomal assets, trp-cage targeting technology and amino acid-derived lipids, that I have felt lacked robust patent protection when used in liposomal formulations similar in composition to Tekmira’s SNALPs.

Theory and IP, of course, are only part of the equation. In terms of actual data, the literature bears out the tolerability of these liposomes. In terms of in vivo knockdown efficacy, I haven’t really seen much for liposomal delivery of siRNA in the peer-reviewed literature. There was, however, a paper on the liposomal delivery of a CD40 antisense oligo (under license from ISIS) in a rodent inflammatory disease model and that supported specific CD40 knockdown and disease amelioration while the unformulated antisense oligo appeared to be inactive. In general, based on the literature and also Novosom’s website, their technology seems to be in the late rodent stage and yet to be validated in larger mammals including non-human primates and Man.

There should, however, be an open IND for the delivery of a DNAi compound (no mis-spelling) by PRONAI which makes use of Novosom’s technology. However, it appears that PRONAI’s funding situation may have delayed actual dosing.

Novosom also entered into at least 2 collaborations with RNAi companies. One with (now defunct) DNA-directed RNAi company Nucleonics for treating hepatitis viral infections, and one with Boehringer-Ingelheim for the validation of drug targets in the liver and lung. Again, because Novosom is a private company I can only speculate whether the lipids used by Nucleonics in their soon aborted phase I study stemmed from the Novosom collaboration. Similarly, the status of the Boehringer-Ingelheim collaboration is unclear to me. Who knows, but maybe Boehringer-Ingelheim is actively looking for (liposomal) delivery and triggers for the development of RNAi Therapeutics, which raises another point: although the press release did not specify this, but selling what looks like the entire IP estate would appear to be tantamount to selling the entire company, existing partnerships and programs included.

But back to the fundamental question: Consolidating into a one-stop-shop, almost an ‘anti-Alnylam’, a la Marina and Silence versus technological deep-dive a la Tekmira- which strategy will create more shareholder value? The next 3 months should provide for some of the answers.

Please let your voice be heard and vote on the right.

Monday, July 26, 2010

Brewing Genzyme Takeover Battle Highlights Value of High-Impact Drug Innovation

Orphan disease drug developer Genzyme had emerged as the drug development of the future by developing innovative drugs which have a high impact for diseases of major unmet medical need and then being rewarded for it with exceptional pricing power. Recent manufacturing problems, however, has led to the business model being forgotten over regulatory angst and activist shareholder actions. Sanofi-Aventis probably simply could not resist the depressed share price and was the first to blink, with others, like GSK, quickly moving in from the sidelines.

That high-impact innovation is a critical part of Pharma’s strategy in the face of its small molecule patent cliff freefall should be obvious. GSK, after announcing an orphan disease initiative last year, for example has entered into microRNA and antisense collaborations with Regulus, Santaris, and ISIS, and Sanofi-Aventis has just entered into relationships for microRNA therapeutics with Regulus and a quite significant one with Oxford Biomedica last year for the development of gene therapies for ocular indications (note: Genzyme is one of the more prominent gene therapy companies). Meanwhile, Pfizer and probably almost every other major pharmaceutical corporation are also building orphan disease capabilities.

I think the action around Genzyme illustrates how quickly investor sentiment towards a company or an entire industry like RNAi Therapeutics can change. It is not that Big Pharma can delay their future planning forever, and should an opportune situation arise they are likely to act quickly.

What I find curious about Genzyme though is that they are really platform agnostic, and I believe that caused some pipeline problems and contributed to Genzyme’s weak stock market performance in recent years after some of the low-hanging fruits had been picked.

Of course, this, as illustrated by ‘Genzyme-like’ opportunities like Alnylam’s ALN-TTR, is where the big opportunity is for RNAi Therapeutics. As treatments become individualized down to the gene level, the druggable genome size and and platform efficiency become major issues. In fact, going after Genzyme may actually be a mistake stemming from Big Pharma’s age-old temptation to pay top dollars for growing top-line revenues. Big Pharma does not need (orphan) drug development expertise, which is where it can well compete with biotech companies anyway, but innovative platforms to complement such expertise.

In any case, this should lift the entire biotech sector, and a similar spark, possibly with a Swiss flavor, may soon ignite RNAi Therapeutics.

Thursday, July 22, 2010

RXi Reports on Dicer-insensitive 25bp RNAi Triggers

There is little question that Alnylam enjoys considerable control over arguably the most desirable type of synthetic RNAi triggers: 19-21 base-pair dsRNAs with 3’ overhangs- some of this control, of course, being somewhat subject to the outcome of the Tuschl Tussle and the review of the Tuschl II patent in Europe. In any case, this had caused a number of competitors to try and avoid this IP estate by designing around these Tuschl-type siRNAs. One of the more popular workaround designs are (blunt-ended) 25 base-pair dsRNAs, being developed by the likes of RXi, Intradigm (now part of Silence Therapeutics), and Invitrogen (RXi has a deal with Invitrogen, most likely covering aspects of RXi’s 25mers). RXi now presents data (Salomon et al.: Modified dsRNAs that are not processed by Dicer maintain potency and are incorporated into the RISC) on the performance of these 25mer siRNAs that are consistent with the notion that it is possible to find highly potent siRNAs with such structures, and that, interestingly, modified 25bp duplexes may often not be subject to Dicer processing before being loaded into the RISC effector complex.

One concern with the use of 25mers is that, yes, they, like a lot of other structures can harness the remarkably robust RNAi gene silencing pathway, but is its potency sufficient for its therapeutic translation? Because RNAi triggers have to satisfy a few other requirements besides potency, as a platform, it is not sufficient to find one or two highly potent sequences, but maybe 5-10 to choose from. The importance of such choice arises from the need to minimize off-targeting and immunostimulatory potential, related to this the ability to modify a siRNA without compromising too much activity, and finding sequences that are conserved in pre-clinical animal models etc.

Sufficient potency to me means 50% knockdown (aka IC50) values of at least 300pM in standard tissue culture experiments (Alnylam’s siRNA in TTR01 e.g. has a single-digit pM potency). Salomon and colleagues provide examples of 2 siRNAs with IC50s of 50-150pM and add, but without showing the actual data, that they ‘have identified duplexes with potency in the picomolar range for over 10 genes and at multiple sites per gene’. So while I am convinced that highly potent 25mer siRNAs can be discovered, the question about the ease of finding those remains an open one. Support that they may not be that rare comes from the gene-specific 25mer siRNA patents filed by Intradigm/Silence Therapeutics that show silencing results from relatively detailed siRNA tiling assays.

It should be possible to increase the pool of potent 25mers by applying design rules like those by Zamore and controlled by Silence Therapeutics. Salomon and colleagues for example report that some of the modifications in RXi's particular 25mer design (unmodified guide strand, 4 5' and 3' terminal 2'-O-methyls in the passenger) affected the unwinding and loading of the passenger strand which may therefore be subject to the Zamore end-stability claims. Moreover, the value of the 3’ terminal mismatches of the guide strand for enhancing RISC turnover, as covered under the first issued Zamore patent, may be particularly high for long guide strands (25mers, see below) because such extended base-pair complementarity (=thermodynamic stability) could negatively impact RISC detachment from the cleaved message and therefore the efficiency with which it can be recycled for the next round of target cleavage. In that sense, Intradigm may have been quite clever in realizing the synergy of the 3' terminal mismatches particularly for the long duplexes as practiced by the company.

Another interesting aspect of the study, also relevant for IP purposes, is that the 25mers were loaded onto RISC without prior Dicer processing. 25mers may have been expected to be subject to Dicer processing to generate Tuschl-type siRNAs. Although this particular legal theory remains to be tested, this may not be the ideal patent for the 25mer companies because Alnylam may argue that Dicer substrates just serve as pro-drugs to the Tuschl-type siRNAs and therefore would require a license. Moreover, if they were indeed processed by Dicer, they might conflict with Dicerna which specializes on Dicer-substrate siRNAs (Dicerna typically uses 27mers). It is therefore of interest that this publication demonstrates quite convincingly that 25base-pair duplexes, whether modified or not, are not processed by Dicer prior to loading into cleavage-competent RISC. Accordingly, the 25mers may well steer clear from infringing either Alnylam’s Tuschl-type siRNAs or Dicerna's Dicer substrates.

As I stated, Alnylam’s RNAi trigger estate is scientifically the most desirable in a number of regards. Extending the length of the dsRNA for example creates additional challenges as it relates to innate immune stimulation, and reduced delivery efficiency for certain siRNA-conjugate delivery approaches. On the other hand, it is certainly possible to find therapeutic candidates for workaround designs like the 25mers and the judicial application of design rules may address some of the disadvantages in the efficiency of finding potent duplexes.

As Alnylam’s Chinese Wall in RNAi trigger is being tested and faces key challenges later this year, both in the US (Tuschl Tussle) and in Europe (oral hearing on T-II at the EPO following challenges by the likes of Merck and Silence), it is delivery more than ever that will be key to Alnylam in strengthening its position in deal negotiations. In particular, assuming that Big Pharma cannot afford to wait forever before making their moves in RNAi Therapeutics, SNALP delivery should continue to be their key for commanding the next $100M+ licensing terms. I'm not really sure what is holding them up as the present situation must have been predictable for the company and I still feel that a move coordinated with Tekmira and one Big Pharma company could be the solution.

PS: While this paper has only come to my attention this week via my pubmed alerts, some of the data contained therein has been previously presented by RXi at scientific conferences. Moreover, whereas the paper appeared in the June edition of NAR, it first appeared online already in early 2010.


When I started this blog, it was initially from the viewpoint of an academic scientist with a keen interest in RNAi drug development. As such I had a strong bias towards patents built on ground-breaking scientific discoveries and somewhat sneered at workaround technologies. As the years have passed, I have however come to the realize that while an academic scientist might be embarrassed to report to peers that a workaround may come close to the real thing, workarounds are a well accepted, even encouraged business practice and Big Pharma will take this into account in their RNAi trigger deal-making. Moreover, because publishing cutting-edge research as quickly as possible is the objective of academic research, in many cases, despite the ‘more worthy’ nature of such science, it has often proven difficult to build strong patents on many of these discoveries (issues such a pre-mature disclosures etc). Biotech companies, on the other hand, can conduct research in a way to maximize its IP value.

Friday, July 16, 2010

Tekmira Awarded Ebola Contract, Continues to Build on Momentum

The mystery surrounding the abrupt halt to the trading of Tekmira shares on July 14 was solved when Tekmira announced that it was awarded a significant US government contract for the development of an Ebola drug worth up to US$140M, $35M of which could be earned over the next 3 years. This essentially provides Tekmira with a free shot on goal for early product revenues, and should also prove beneficial for its overall balance sheet because of the typical fee component of such contracts plus expenses generally applicable to SNALP drug development.

This development nicely builds on the impressive SNALP-Ebola study published in the prestigious journal The Lancet less than 2 months ago where Tekmira scientists along with collaborators from Boston University (Geisbert group) showed for the first time the complete protection of non-human primates in a post-infection model.

While this is not the Big Pharma buy-out deal that I had speculated about yesterday, this endorsement of SNALP technology by the US government only makes one more likely now. It is even more impressive given that Tekmira, based in Canada, obtained this contract on a shoe-string budget without the significant government support that competing groups have enjoyed, and in a much shorter period of time.

The initial funds will be used for IND-enabling pre-clinical development and one phase I human safety study. This should involve more extensive safety and efficacy testing in animals, especially non-human primates, and the development of biomarkers predictive of efficacy in humans where efficacy cannot be tested. Ultimately, the big payout in the form of the first RNAi Therapeutics product revenues may come from government stockpiling contracts after further successful clinical safety and non-human primate efficacy testing.

The contract raises once again questions about Tekmira’s relationship with Alnylam. Alnylam actually have earned from 2007-2009 about $30M in hemorrhagic fever virus R&D government funding and may therefore at one point have competed with Tekmira (then Protiva) for such government contracts. Another interesting issue is whether Tekmira would have to exercise a target pick under the Alnylam RNAi trigger license. It is possible, however, that Tekmira will not have to exercise one because it is likely that the US government, the eventual main customer of any Ebola product, has rights to many of Alnylam’s fundamental RNAi trigger patents. It is also curious that Alnylam appears to have given up their pursuit of Ebola therapeutics, and could possibly reflect the influence that Tekmira enjoys in practical terms in who is able to pursue SNALP products and for which targets (‘Tekmira know-how’).

Overall, this was unexpected news to me. I had mainly considered the value of the Ebola program as being a quite visible proof-of-concept for the wider applicability of SNALP delivery, not expecting any significant funding windfalls. Following the wide publicity that The Lancet paper received, the fact that this study now turns out to have actual positive financial implications for the company could mean a significantly shortened trajectory towards profitability and increased investor interest to coincide with the upcoming Nasdaq listing. If that were not enough, the upcoming filing of the IND for SNALP-PLK1 and the $100M Novartis decision means that the momentum is now decidedly in Tekmira’s favor.

In related RNAi Therapeutics deal news

Quark Pharmaceuticals and Japanese Co. Nitto Denko announced a collaboration whereby Quark will contribute its RNAi triggers, with supposedly structural features that provides them with freedom-to-operate, with Nitto Denko’s siRNA delivery technology to develop an RNAi Therapeutic for cirrhosis of the liver. Financial details were not disclosed, except that it said to be in the double-digit million dollar range. While the exact nature of the delivery technology was not disclosed, the press release referred to a 2008 Nature Biotech paper that successfully employed small molecule-targeted cationic liposomes to knock down a cirrhosis-related gene in specialized cells of the liver. Liver cirrhosis is certainly another disease of the liver of high unmet medical need and attractive for liposomal siRNA delivery. Ligand-targeted liposomes should even further expand the utility of SNALP-siRNA delivery and I look forward to learning more about progress in that area, including the detailed structural and functional characterization of such particles.

Wednesday, July 14, 2010

Tekmira Trading Halt: Time for Some Wild Speculations

As many of you will be aware by now, trading of Tekmira shares has been abruptly halted just 15 minutes before market close on Wednesday July 14, 2010. Certainly, this strongly indicates that an unexpected event has occurred, but will it be good or bad news?

As a biotech investor, I am prepared for more negative than positive surprises. Adverse events from clinical trials can be a source of unexpected bad news. What is encouraging though is that Tekmira is currently not actively dosing in the clinic, and there is no sign that any trials by partner Alnylam involving SNALP-RNAi formulations based on Tekmira’s technology have been put on clinical hold according to website. In the same vein, after-hours trading in ALNY has not been halted either. As an aside, it is surprising though that there were hardly any trades in ALNY after-hours since major news involving Tekmira should also move ALNY, but then again recent market activity suggests that important news does not affect valuations of RNAi Therapeutics companies anyway.

If there was any logic to biotech investing, my bet would be on a takeover bid by Big Pharma. As I have detailed here many times, Tekmira’s strategic value in RNAi Therapeutics cannot be underestimated. In fact, I am very relatively that we have not heard yet of for example Novartis or Pfizer. Pfizer though engaged in a prelimary collaboration with Tekmira 4 months ago, about enough time for Pfizer to test some SNALP formulations in-house. Moreover, the impressive Ebola data published in The Lancet may have gone a long way in speeding up the decision to secure access to SNALP siRNA delivery. If indeed it turns out to be a takeover bid, it may only be the start of a bidding contest.

So while Tekmira is probably better equipped than most to go it alone, the value of SNALP to Big Pharma is considerably higher than it is to Tekmira alone. Because of Tekmira’s ownership structure, I would consider $3/share to be the bare minimum for negotiations to start, and this would not even start to reflect the value of SNALP and Tekmira’s RNAi know-how to most in Big Pharma.

The acquisition of a pure-play RNAi Therapeutics company by Big Pharma should also benefit the entire sector. While only three years ago, I more often than not liked to criticize some of the wild claims made by a few companies in the space, the pendulum has swung fully into the opposite extreme, to a point where there are now a number of companies with attractive valuations.

Alnylam as the bellwether of the industry would naturally benefit from additional evidence that RNAi Therapeutics is important to Big Pharma more than ever. The mid-term downside risk should be quite limited and I would look out for any attractive entry points should the Tekmira news be initially interpreted as being hostile to Alnylam. One way or another, investments in RNAi Therapeutics will end up benefiting Alnylam. For the more speculatively inclined and depending on the Tekmira financials, mdRNA and especially Silence Therapeutics could be attractive here.

While Tekmira’s technology is considerably more de-risked, Silence Therapeutics now has decent IP, science, and a not insignificant clinical footprint all for the price of a little more than $20M and with probably about 12-18 months of cash runway (depending a bit on the AZ milestones and cost savings from the recent restructuring). For the bullish and nimble, Silence Therapeutics may also represent an opportunity to buy some shares of by-stander companies on the UK AIM stock exchange before Tekmira will break any news.

mdRNA has a management that seems to understand how to get a foot in the door of Big Pharma, and merger-partner Cequent’s technology being so differentiated (mechanism and sites of action plus attractive cost of goods) from the mainstream and already a candidate in the clinic that Big Pharma may be tempted to place a limited bet on trans-kingdom RNAi. Personally, I would prefer to first get more clarity on that company's strategy going forward.

But back to Tekmira. Keeping in mind that Tekmira may just as well announce bad news such that a fire has destroyed their brand-new SNALP manufacturing suite or that the CEO has broken his leg and will be incapacitated for the next critical 2-3 months, a takeover would only be the fruits of the hard labor and dedication its employees have put in, without much attendant hype (much of the SNALP hype you will find here), and without which I would not want to contemplate the current state of RNAi Therapeutics. I would also hope that the R&D activities in Vancouver would be maintained such that SNALP medicines can get to patients as fast as possible.

Pfizer, Novartis, Merck, Roche, GSK, or even Alnylam (with Novartis in tow)….could it be one of them?

PS: None of the above is to be taken as investment advice. Instead, consider it a Gedankenexperiment. Early-stage biotech takeovers by Big Pharma are actually quite rare events and most investors are convinced that it must be their company that’s next. See also disclaimer at the bottom of this page.

AstraZeneca Shows Continued Commitment Towards RNAi Therapeutics through Partnership with Silence Therapeutics

One week after announcing the grant of a US patent covering RNAi triggers with enhanced guide strand loading, Silence Therapeutics today announced the one-year extension of its R&D collaboration with AstraZeneca for the ‘identification and optimization’ of five siRNAs targeting genes involved in cancer and respiratory disease. This relationship dates back to 2007 when AstraZeneca paid Silence a 7.5M pounds Sterling technology access fee plus the usual potential for future fees and milestones. After similarly extending and expanding relationships earlier this year with AstraZeneca and Dainippon Sumitomo in RNAi delivery, Silence Therapeutics has met important partnership goals earning it time to now prove to the investor and pharma worlds that its merger with Intradigm also brought with it technological synergies.

The way I read the AstraZeneca extensions is that Silence Therapeutics was certainly able to convince AstraZeneca that it is a RNAi Therapeutics company with scientific credibility, but that AstraZeneca still needed extra time before it could fully commit to Silence Therapeutics. It is interesting to speculate that AstraZeneca was a major force behind the Silence Therapeutics-Intradigm merger, as Intradigm had filed for a number of patents covering siRNA sequences against cancer-related as well as inflammatory targets also useful for respiratory diseases. Some of these have actually started to issue and may come in handy for this siRNA-specific collaboration [update: the company informed me that the Intradigm RNAi triggers would not be part of this collaboration, and re-confirmed that the RNAi trigger and delivery collaborations are separate. Sounds to me like they are holding back, possibly hoping to monetize some of these assets on even better terms to another potential licensee or as part of a larger collaboration with AZ eventually].

As to the targets, I could imagine that, based on the unmet need and AstraZeneca’s interests, RSV infection, asthma, COPD, and solid cancers esp. primary liver cancer are among them. Of note, mdRNA announced earlier this year an early collaborative effort with AstraZeneca China for studying that company's liposomal delivery technology for liver cancer, and today’s press release mentioned that AstraZeneca's Chinese R&D branch was part of the Silence collaboration, too. Since Silence Therapeutics appears to be keen to emphasize that the siRNA and delivery collaborations are separate- scientifically not necessarily the most sensible approach, but a deficiency that may open up the prospect of a more lucrative arrangement in the future- it is certainly an interesting thought if Silence’s siRNAs were to be formulated in mdRNA’s liposomes. Of course, it is more likely that mdRNA and Silence compete with each other for AstraZeneca China’s favor in liver cancer, but still...

As I said, it would eventually make a lot of sense to consolidate the two efforts, siRNA and delivery, into one larger collaboration. Based on Silence’s own data, I am fairly encouraged that its lipoplex-siRNA formulations could be generally useful for knocking down genes in the vascular endothelia, which not only would be of obvious relevance for cancer, but also lung disease which often involves vascular escape and infiltration of the lung by inflammatory cells. An alternative approach to siRNA delivery to the lung is, of course, by inhalation, desirable e.g. for RSV infection involving lung epithelial cells, although Silence hasn’t reported much progress in that regard. It remains to be seen what Intradigm's technology can add to that.

Ultimately, I consider today’s extension a major de-risking event for the near-term health of Silence Therapeutics. While much remains to be done, the stock at 5.5 pence and a market cap of little over $20M is simply too cheap, if not an insult to RNAi Therapeutics in general. It is especially encouraging that AstraZeneca shows continued interest in RNAi Therapeutics, a company that I honestly had at the bottom fifth of Big Pharma companies willing to embrace cutting-edge platform technologies to once again efficiently develop drugs that make a difference. Unless their goal is to buy back all their shares and eventually liquidate operations or become consumer healthcare companies selling diapers and skin lotions, realistically, it is their only way forward.

Thursday, July 8, 2010

Silence Therapeutics Issued Important Zamore siRNA Design Rule Patent

Silence Therapeutics announced yesterday the issuance of a United States patent related to the design of gene silencing siRNAs. This is the second such patent issuance in little more than a month for which Intradigm, Silence’s merger partner earlier this year, had exclusively licensed from the University of Massachusetts and that is based on fundamental work by the Zamore lab on the enzymology of RNAi. These and other recent patent issuances related to sequence/gene-specific siRNAs address some of my concerns that I had with regard to Silence’s RNAi trigger strategy that I felt was at the risk of being too narrow and, as a consequence, becoming outdated. They should complement Old Silence's lipoplex delivery technology for vascular endothelia with valuable siRNAs in the fields of oncology and retinal disorders. Together, these developments provide evidence that the merger is starting to prove synergistic, with Silence providing the technical know-how and Intradigm complementary IP.

The two Zamore patents that were recently issued in the US relate to guidelines on how to design siRNAs with increased efficacy and selectivity. The first one, announced last month (US patent 7732593) teaches the use of mismatches between the 3’ end of the siRNA guide strand with the target mRNA so as to enhance the ability of the RNAi gene silencing complex RISC to detach from a target mRNA once cleaved and seek out new target mRNAs (note: one of the reasons RNAi is so potent is because one siRNA can destroy many mRNAs). The biochemical experiments on which these claims are based have well stood the test of time. The value of this particular patent for Silence Therapeutics is that it gives them and potential partners optionality for eventually replacing the somewhat restrictive Atu-siRNA design with next-generation siRNA structures based on solid scientific evidence. It has to be said, however, that while many current siRNAs have in fact two such mismatches, or ‘non Watson-Crick base pairs’, namely the classical Tuschl dTdT overhang that was originally conceived as stabilizing the siRNA from exonucleolytic degradation, the claims specify at least three such mismatches in the last five nucleotides of the guide strand. Moreover, the benefit of such mismatches in living cells remains to be determined, as some of the helicases and nucleases that may facilitate RISC detachment from a cleaved target mRNA in living cells may have been missing in the test tube experiments by the Zamore lab.

So while US7732592 is certainly a quite useful patent to have control over, it is the Zamore patent US7750144 of which the issuance was announced yesterday (‘Methods and Compositions for Enhancing Efficacy and Specificity of RNA Silencing’) that should provide for some interesting discussions. This patent is based on one of the classic findings in RNAi molecular biology, namely that the efficacy and selectivity of small duplex RNAs, both siRNAs and miRNAs, is critically determined by the relative thermodynamic stabilities of the two ends of an siRNA (Schwarz et al., 2003: Asymmetry in the assembly of the RNAi enzyme complex). Accordingly, it is the strand of which the 5’ end is less stably base-paired that is preferentially loaded into the RISC gene silencinng complex to become the guide strand, while the non-incorporated strand is discarded as the 'passenger strand'.

This has a few implications for siRNA design. First of all, it increases the absolute loading and consequently silencing efficacy of an siRNA. Secondly, by preferentially loading just the desired strand to become the guide, the potential undesired/off-target activity of the passenger strand can be virtually eliminated. These asymmetry rules have also been extensively validated in living cells and are part and parcel of most siRNA design strategies and algorithms. They are also consistent with structural X-ray crystallographic findings that show that the 5’ end of a guide strand within RISC is unpaired. As a result, it is very likely that a number of siRNA therapeutic candidates currently in the clinic could be interpreted to fall within the scope of this patent. This should also encourage some of the research & reagent companies that sell synthetic siRNAs to take a license from Silence Therapeutics.

The actual issued claims relate to a method of decreasing passenger strand activity by introducing one or more changes in the interaction between the 5’ end of the guide strand with the passenger strand such that the loading of the guide strand is enhanced. The broadest interpretation, and the one that I would expect Silence will take, is that any siRNA containing such a modified nucleotide or mismatch in the specified region (the first 5 nucleotides of a guide strand) would infringe. Most siRNAs should fall within this definition. In some cases, such modifications may have in fact been motivated by other things like stabilizing an siRNA against degradation or reducing innate immune responses, but this remains to be tested, unless the companies involved choose to settle without resorting to yet more exhausting and extremely tedious legal battles. I should note here that when one follows the patent prosecutions especially in Europe, there does not seem to be a single patent that gets issued that will not be opposed by the other party, no matter the scientific merits (my personal opinion). It is enough that some in Big Pharma routinely abuse the patent system to bully smaller competitors into bankruptcy, essentially a way of doing business, and pure-play RNAi Therapeutics companies should be smart enough to know that by adopting these practices they only destroy the size of the shared pie they all depend on: patent-protected innovation. But I digress...

In summary, the recent events have lessened my concerns that it was largely Intradigm that was the beneficiary of the merger as their historical focus on IP is now bearing fruit in the form of some quite fundamental patent issuances and should nicely complement Silence’s strength in the science and clinical translation of RNAi which I had considered to be the stronger of the two. So while I still await data that similarly support the company’s claim that the merger also brought synergies in siRNA delivery, the combined company appears to be quite undervalued here with a market cap of around $20M. The patent issuances should also bode well for the extension of the RNAi trigger-focused part of Silence’s relationship with AstraZeneca. Because of this and because the markets appear to be on summer vacation with the stock virtually unchanged following such strategically important patent news for the company, I’ve decided to buy a few shares of Silence here.

PS: For the various reasons that you can also find in Silence’s regulatory filings, investments in RNAi Therapeutics in general and Silence Therapeutics in particular have to be considered very high risk. Moreover, although I consider myself fairly familiar with the molecular biology of RNAi, I am not trained in intellectual property and my interpretations of the Zamore patents have to be read in this light. Please also read the disclaimer at the bottom of the page.

Sunday, July 4, 2010

ALN-TTR, an Exemplary RNAi Therapeutics Candidate in Many Ways, Debuts in Clinic

Alnylam announced last week that it has obtained the necessary approvals to start recruiting patients for their 3rd clinical RNAi Therapeutics candidate: ALN-TTR01. This is a truly exciting program, not only because it is supported by quite impressive pre-clinical data, but especially because it highlights the unique benefits that RNAi Therapeutics can bring to medicine which should also translate into favorable economics. In a related vein, ALN-TTR is now the 3rd clinical candidate based on SNALP delivery* that has entered the clinic within the last 18 months and thus demonstrates another important dynamic in RNAi Therapeutics: once a delivery technology has been established for a given tissue, a wealth of clinical candidates will flow from that.

ALN-TTR01 targets the transthyretin gene, a gene predominantly expressed in the liver and whose normal function is to facilitate the transport of Vitamin A and thyroxin, but when mutated is prone to misfold and deposit itself into a number of tissues as amyloid fibrils. This causes damage to the surrounding tissues, and typically first manifests itself as either predominantly polyneuropathy (FAP) or cardiomyopathy (FAC) depending on the genotype. Once a person becomes symptomatic, typically from around the age of 40 to 60, they usually will progress and succumb to the disease within 10-15 years. It is estimated that around 10,000 people are affected by the polyneuropathy-biased form of the disease largely in the Western world, with another possibly 40,000-100,000 affected by the cardiomyopathy-biased form largely in Africa. In addition, misfolding of normal/wild-type TTR may contribute to ageing more generally as it is quite common to find amyloid fibrils in autopies of men older than 80 years (for a more detailed review of TTR amyloidosis in the clinic, click here).

The only disease-modifying treatment available is liver transplantation. However, because of the limited supply of donor livers and limited efficacy, there is still tremendous need for new treatment options. Recently, fellow Cambridge-based FoldRx has announced late-stage clinical results for FAP with a protein-targeted oral small molecule aimed at stabilizing the correct fold of transthyretin, Tafamidis. While the top-line data indicate Tafamidis to have some potential as the first disease-modifying pharmacological agent for TTR amyloidosis, the unmet need will remain to be very high and based on this mechanism of action may actually synergize with an RNA-targeted drug like ALN-TTR.

Conservatively, peak annual sales for new drugs that can have a significant impact on this disease could therefore be in the $500M-1B range, largely for FAP in Western societies. This is quite attractive for an emerging biotech company like Alnylam, because large salesforces would not be required and the potential for rapid development. As with other ‘orphan’ diseases for which there are no great treatment options available, it is also possible that the eligible patient numbers are an underestimate and breakthroughs in drug development will lead to more patients being diagnosed with the condition. Optimistically, economic development in less wealthy societies could lead to a further expansion of patients that could afford the treatment.

The attraction of targeting the RNA in TTR amyloidosis is that the disease-causing protein will never be made in the first place. By contrast, a protein-targeting agent would have to constantly keep the protein in check. Similarly, ALN-TTR should also be an approach that is superior to liver transplantation in that it also addresses the potential of the wild-type TTR (as would be produced by the donor liver) to add to pre-existing deposits (applies to some, but not all genotypes) by targeting both mutant and wild-type TTR mRNA. In mouse models, this strategy has even been shown to effectively reverse such pre-existing deposits. Of note, down-regulation of TTR per se should be well tolerated and no untowards effects related to this have been reported in the very impressive non-human primate pre-clinical studies.

ALN-TTR is also exemplary because the target has been selected mindful of available delivery technologies (SNALP, developed with Tekmira Pharmaceuticals). To be clear, we are still early in the clinical learning curve for SNALP delivery, but given the unprecedented amount of non-human primate data in the peer-reviewed and patent literatures (by multiple groups) that demonstrate SNALP to be able to reliably, potently, and apparently without much toxicity knock down essentially any gene in the liver of non-human primates, one would think that the clinical experience should be similarly swift and impressive as the translation of SNALP from mouse to non-human primates (30g to 5-10kg) in the last 5 years.

ALN-TTR01 employs 1st generation SNALP technology which, as a rule of thumb, can knock down genes in the liver by half at dosages of around 1mg/kg in pre-clinical animal models. The preliminary efficacy findings with SNALP-ApoB1 in the clinic are consistent with the notion that similar ED50 dosages can be expected in humans. The present clinical trial, however, only aims to escalate ALN-TTR01 to a dose of 0.4mg/kg. Since the siRNA in ALN-TTR01 is a very potent one with an in vitro IC50 value in the low pM range, it is possible that TTR01 may show some knockdown at 0.4mg/kg. Accordingly, the ED50 value of this particular candidate was reported to be 0.3mg/kg in non-human primates. The reason why Alnylam chose not to go higher than 0.4mg/kg may be because Tekmira’s ApoB and Alnylam’s ALN-VSP02 results have indicated that they may run into relevant toxicities dosages of around 1mg/kg.

So while ALN-TTR01 has some promimse to be the TTR candidate that Alnylam will aim to fully develop, an important part of the dose-finding puzzle is that Alnylam has plans to develop a second TTR candidate, ALN-TTR02, in parallel which now employs 2nd generation SNALP formulations which have 10-50 fold lower ED50s in animal models as reported earlier this year (see here and here). As such 0.4mg/kg should already serve as a stringent test for the safety of SNALP delivery in general. Speaking of delivery and safety, the TTR program is also an excellent choice in that the liver is the target organ for the delivery, but not significantly impaired by the disease itself. Such impairment could impact both the efficacy and safety of SNALP delivery. In summary, while it is possible that ALN-TTR01 will eventually be abandoned because the rapid improvement of SNALP efficacy and safety dictate that follow-up candidates should receive priority, there is significant value that Alnylam will gain from this phase I trial.

Since the company is not blinded to the results and the initial efficacy of ALN-TTR can be assessed readily by measuring TTR in the blood, first results may become available early in 2011. ALN-TTR has all the potential to become Alnylam’s most valuable pipeline asset, both for its intrinsic commercial potential as well as an example of the unique characteristics that RNAi Therapeutics can bring to drug development.

* SNALP-RNAi candidates that have already entered clinical phase:

ALN-VSP (Alnylam);

SNALP-ApoB (Tekmira);

ALN-TTR (Alnylam);

Declared SNALP-RNAi candidates about to enter the clinic:

SNALP-PLK1 (Tekmira; IND expected any time now);

a candidate by Roche for which the IND should be filed by year-end (undisclosed candidate);

ALN-PCS (Alnylam’s next RNAi Therapeutics candidate to enter clinic in H1 2011).

By Dirk Haussecker. All rights reserved.

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