Wednesday, June 10, 2015

Alnylam Slams Dicerna with Trade Secret Complaint

How times have changed.  Four years ago, Alnylam found itself on the receiving end of a trade secret lawsuit regarding the delivery technology du jour, SNALP LNP then, in which it ended up paying near-bankrupt Tekmira ~$70M to settle the allegations.  As I opined back then, Alnylam seemingly used almost any means to get access to the know-how to make SNALP LNP delivery work in primates in an effort to rid itself of the reliance on Tekmira, the inventors.

At that time, all Alnylam's CEO had to say on the topic of honoring trade secrets: 'you pay for it, you own it'.

Tonight, Alnylam claims to be the victim of similar trade secret misappropriations surrounding RNAi delivery technology.  In this case, Alnylam alleges (see Complaint) that Dicerna had hired ex-Merck RNAi scientists to gain access to critical GalNAc trade secrets invented at Merck after Merck sold their RNAi assets to Alnylam and laid off related employees.

An interesting aside of this is that it appears, contrary to representations by Alnylam, that the GalNAc-ESC technology were invented at Merck, not in-house at Alnylam.

The Complaint makes it clear that Alnylam feels threatened by the technologically very direct competition.  In a way, Dicerna’s new strategy was to become Alnylam's clone.  What could be worse, given the differences in the RNAi trigger lengths (~19bp Tuschl-type siRNAs by Alnylam; 25/27 and longer Dicer-substrate versions by Dicerna) and the apparent importance of stability/degradation in GalNAc technology, there is the distinct possibility that Dicerna’s version, everything else being equal, would outperform (or underperform) Alnylam’s.

In light of recent apparently rapid progress at Dicerna on GalNAc technology and the timing of events, the idea that Dicerna may have benefited from the GalNAc know-how of ex-Merck scientists does not seem far-fetched.  

It is unclear to me, however, whether you can expect expert oligonucleotide chemists to suddenly forget everything about their former job. 

Alnylam obviously takes care of that problem by enforcing harsh non-compete and pay-for-silence practices against their former employees, meaning that if you are an RNAi scientist that job at Alnylam will be your last RNAi job in the industry, period. 


Looking forward, I predict that the outcome of the case will hinge less on the physical documents that were alleged to have been ‘misappropriated’, but on whether or not the ex-Merck scientists could have re-invented GalNAc-ESC based on their skills and publicly available information (including from Alnylam) at the time.  If so, then Alnylam only has Merck to blame that it does not force their employees to leave their profession when they lay them off.

Regardless, the GalNAc-ESC genie is out of the bottle.

10 comments:

Steve_382 said...

If they invented it once, it should be easy to do it again. Should be interesting.

Newsurfer said...

Dirk,

You say that the outcome of the case will likely turn on "whether or not the ex-Merck scientists could have re-invented GalNAc-ESC based on their skills and publicly available information (including from Alnylam) at the time. If so, then Alnylam only has Merck to blame that it does not force their employees to leave their profession when they lay them off."

It seems to me that the key phrase is "re-invented." You seem to say that if the ex-Merck employees could reproduce, or to use your word "re-invent," the chemistry compounds without the aid of Merck's confidential documents, then ALNY as successor to Merck, is without legal remedy. Why do you believe the law does not go further than this in protecting these trade secrets?

For example, assume a Merck employee invents a new chemistry (within the scope/course of his employment). Typically, Merck owns this new chemistry, not the employee. Assuming Merck has its legal affairs in order, this same employee may not simply reproduce his invention, even if only from memory, for the benefit of his next employer, without running afoul of the law.

Further, courts are loath to enforce clauses in employee agreements that unreasonably limit the employee's future employment options. Such restrictions must be narrowly drawn or risk being struck as unenforceable.

Agree? If not, please explain what I am missing or not understanding.

Thanks for all of your efforts.

tufulipo said...

I believe "karma" is the operative term here.

Anonymous said...

Karma-swimsarmi? Oh. Back to Benetic again. They must be at the root of this because of the Rossi connection.

sherk said...

"An interesting aside of this is that it appears, contrary to representations by Alnylam, that the GalNAc-ESC technology were invented at Merck, not in-house at Alnylam."

Again, Dirk, your very obvious grudge against Alnylam is on display. ALN-AT3, as the first ESC-conjugate, was clearly invented way before the Sirna acquisition in 2014. So unless Alnylam stole the ESC technology from Merck itself or invented time travel, my guess is simply that Merck was working on similar conjugate stabilizing technology (coincidentally, while you scoffing at GalNAc conjugates and extolling LNPs as the future of siRNA delivery).

Dirk Haussecker said...

Sherk- I agree with you in the sense that ALN-AT3 is an interesting case. Will be interesting to see whether the candidates that went into development subsequently were changed based on what they got from Merck. And yes, I would expect for Alnylam to have angled for insights (trade secrets be damned) into Merck's GalNAc efforts as it's been an open secret that Merck's stabilization chemistry efforts may have been superior to those at Alnylam.

Anonymous said...

Unless Dicerna can show that its GalNac chemistry is qualitatively different from Alnylam's, it stands a good chance of losing this legal battle.

Dirk Haussecker said...

RE the last comment: GalNAc conjugation does not belong to Alnylam (others, including Arrowhead, well before Alnylam) and that you have to stabilize the RNAi triggers, well, is not exactly a trade secret. So I would NOT expect Dicerna's strategy to be substantially different from Alnylam's.

Anonymous said...

It's more likely to hinge on the documents rather than any specific technology.

Anonymous said...

Dirk, what do you think of the BLT IPO? Exosomes aside, in all honesty this has to be a great thing.

Voyager will be dropping off the edge of the earth soon.

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