RNAi Therapeutics Still Challenged with Re-Educating Pharmaceutical Industry

Judging from the body language of RNAi Therapeutics companies, it seems that they are still fighting a wide-spread perception, also in Big Pharma, that systemic siRNA delivery is limited to targeting genes in the liver and that as a result the current commercial opportunities are relatively small. To quote from Alnylam’s press release yesterday, on research presented at the 8^th International M. Judah Folkman Conference ‘The new research demonstrated effective silencing of target genes in distinct cell types and tissues beyond the liver with systemic delivery of RNAi therapeutics’ [emphasis mine]

To me this is frustrating as it should be obvious to any modern biologist that a strategy of selecting drug candidates starting with the characteristics of delivery systems that already show much promise for clinical development should yield a rich pipeline. Just think about 'only' the liver and how it affects a range of diseases in therapeutic areas ranging from metabolic, to cardiovascular, and even neurological diseases.

Or take systemic delivery to endothelial cells as another example. First pioneered in the commercial realm by Silence Therapeutics with their positively charged siRNA-lipoplexes (see Atu027 clinical candidate for solid cancers) which, as Alnylam rightly points out, has implications for diseases such as ‘atherosclerosis, diabetes, inflammation, and cancer’. Consequently, companies like Silence Therapeutics and Tekmira have made it a high priority to demonstrate the wider applicability of their delivery technologies.

This to me indicates that the established pharmaceutical industry may be even slower in adjusting their thinking than I originally imagined. One can only hope for both RNAi Therapeutics and Big Pharma that the transition from therapeutic franchise-driven to technology-driven drug development will be realized sooner rather than later. To put it bluntly, the franchise-driven strategy worked in an era where sales and profits were more a function of the number visits paid by large salesforces to primary care physicians and the number of drugs in a given franchise the salesperson was able to pitch in a single visit, rather driven by the data underlying an approved drug.

But with small molecule generics eroding Big Pharma's profit base, this has more and more become a losing proposition, and the focus has rightly shifted to advanced and highly targeted technology platforms having hopefully larger impacts on the diseases they address and akso being less easy to copy. Because such therapeutics can command high prices, this allows for a model in which only small, well trained and educated salesforces are needed to address very specialized markets.

A company that I consider to be torn between the franchise vs technology strategy is BiogenIdec. This is a company that much values their franchise in multiple sclerosis, and is rightly also proud of its capabilities in protein engineering. As a result of trying to marry both worlds, they seem to be paying the price of having to in-license drug candidates for the MS franchise which limits their profit growth. Proteins/antibodies alone seem to miss important opportunities in MS. However, considering all types of technologies for a given franchise appears to be too tall an order for a mid-sized company. And when that company has an opportunity in protein therapeutics, but outside its core franchises, no matter how exciting financially, it is faced with a real communication challenge (see BiogenIdec’s recent hemophilia roundtable).

It is my thesis that the use of the new platform technologies demands a re-thinking of what ought to be driving the selection of development candidates. It is for example clear that candidates based on RNAi Therapeutics depend heavily on having extensive RNAi expertise. Knowing the capabilities of the technologies, especially the tissues and cell types that they can address and pharmacology involved, one may then go out and consult with disease specialists in the various areas to discuss specific treatment strategies.

A model that is more likely to work for large companies is therefore to establish those Centers of Technology Excellence and have them interact with the more disease-oriented people in the rest of the company. Hardly a new concept and it is certainly also happening to some degree in the RNAi Therapeutics space, examples here being Roche Kulmbach, Merck Sirna Therapeutics, and Pfizer Coley/RTC. Nevertheless, despite these encouraging signs, even in those cases I’m still not sure whether the dynamics within those companies are conducive to RNAi technology-driven drug development.

Opko Health and its RNAi Therapeutics candidate (for wet AMD) is probably a good example of where an RNAi Therapeutics drug development project was run largely by disease specialists. Since I could never understand how a group without much of a track record in RNAi could possibly come up with the first RNAi Therapeutics candidates, it did not come as a surprise to me that that candidate eventually failed. I am also worried that when Pfizer and Novartis decided to license certain RNAi Therapeutics candidates from Quark, these were decisions largely made by the particular disease focus groups in those companies instead of being integral to those companies’ RNAi Therapeutics efforts.

Ironically, this situation can be partly attributed to the fact that RNAi has to a certain degree allowed for the democratization of drug development by facilitating translational research: I could teach any semi-bright 12-year-old in a day design an RNAi molecule that will knock down a gene. This, however, does not mean that it will make for a suitable development candidate.

So yes, it is worth reminding Big Pharma and investors that systemically delivered RNAi Therapeutics are on the horizon, not only for gene targets in the liver, but also beyond. The mere fact, however, that it is still necessary to emphasize this constantly tells me that a slow-moving pharmaceutical industry leaves a lot of RNAi Therapeutics value unlocked. Liver, cancer, endothelial cells, phagoctytic cells, sites of inflammation, the retina, neuronal cells…put a dozen RNAi scientists, another dozen geneticists and two dozen experts in the pathophysiology of important diseases in a room for a week, and you may end up with more interesting development projects based on currently available RNAi technologies than you have the manpower to pursue.

After this more general critique of the pharmaceutical industry, I will try and shed some light about the particular advances highlighted in the Alnylam press release in my next blog entry.

RXi Pharmaceuticals Still Confident About Outstanding 2010 Goals

A week or so ago, I had the opportunity to talk by phone to the CEO and CSO of RXi Pharmaceuticals, Noah Beerman and Anastasia Khvorova respectively, about the company's scientific and business development strategy. Overall, they were quite upbeat about the prospect of turning around the perception of a company aimlessly wandering around in early technology development and increase shareholder value by finally moving their technology into the clinic and raise the promised non-dilutive capital. Specifically, they did not flinch when asked about their belief whether they were still on track to achieve their outstanding 2010 goals: the selection of their first development candidate (anti-scarring) for which an IND would be expected in 2011, and establishing their first major partnership.

Painfully aware that RXi has a history of promising lucrative partnerships, not one of which has yet to come to fruition, I specifically wanted to confirm that the stated partnership goal is yet to be reached and is not accounted for by the recent string of deals where RXi evaluates whether its self-delivering siRNAs ('sd-rxRNA') have utility in conjunction with technologies provided by partners small and large. While definitely the right approach to explore the wider potential of sd-rxRNAs (note that they have 6-12 month milestone goals), these deals lack the traditional upfront monies and royalties/milestones which would make a world of a difference in limiting shareholder dilution until the company’s own product candidates will allow it to raise capital on the risk-averse financial markets on favourable terms. And yes, Noah Beerman left no doubt that the company has no intention of letting the technology development deals serve as a substitute for that partnership goal.

Yet the exact nature of such a deal was left an open question. It seems that the company is still debating internally about issues such as whether such a deal ought to involve its strategic areas or its core focus areas in ocular and dermal disease. I can understand if a potential partner wanted to benefit from the company’s technology for ocular disease in particular, but that RXi might feel that it should get a better valuation for that at a later point. On the other hand, with self-delivering rxRNAs having potential for direct and localized RNAi applications beyond their core focus areas, such as in certain cancers (e.g. cervical, bladder, breast, maybe liver), respiratory disease, and disorders of the CNS, there could be demand for the technology in non-focus areas, too. This would be mutually beneficial, since these investments would help develop sd-rxRNAs in areas, many of which very attractive financially, for which RXi with its 32 employees and less than $10M in cash realistically wouldn’t have the resources to pursue on its own and the potential value of which would eventually have to be written down. Accordingly, it seemed that CNS and oncology could indeed be high-traffic areas for partnership discussions.

Do I believe that RXi’s sd-rxRNAs have the potential to form the basis for a decent Big Pharma deal (what follows in the next two paragraphs are my speculations only, not management’s guidance)? Based on conference presentations and the company’s patent application for the technology, I do believe that it has such value simply because unformulated siRNAs should eventually occupy a niche in RNAi Therapeutics and RXi can be considered a, if not the emerging leader in this area. Alnylam (of cholesterol-siRNA conjugate fame), naturally, and Dharmacon (Accell siRNAs) can probably be considered the two closest competitors. While Alnylam seemed to have the early lead in the area (2004 Nature and 2007 Nature biotech papers), it is not clear to me what their current stage of the technology is. It seems like the comparative data slightly favors sd-rxRNAs, but in order to command favourable economics, one has to assume that RXi has now amassed, through sheer focus and some siRNA chemistry genius of Dr Khvorova, such a toolbox of diverse chemistries and know-how in designing potent sd-rxRNAs such that candidates with IC50 potencies in the low nanomolar range can be found routinely in passive tissue culture uptake studies, instead of the 500nM-10uM potencies commonly observed with first-generation lipophilic-siRNA conjugates. In this regard, I am concerned that the patent applications that provide RNAi trigger screening examples for a number of genes, do not support that. However, RXi may have chosen, for trade secret purposes, not to provide the best mode in the patent application, but modes of applications sufficiently advanced to get patents issued.

If the technology has indeed advanced over what is publicly available and a deal were to involve the core area of ocular disease, I could imagine a drug discovery deal in which RXi gives away a handful of targets in return for ~$20M in upfront plus the usual milestones and royalties. If CNS or oncology, a deal involving a similar number of drug candidates with a $10M upfront plus an equity investment at a premium would appear reasonable.

As we concluded the talk, I had to ask about how to interpret parent company CytRx' aggressive selling of RXi stock, very disconcerting indeed given the already depressed share price (RXII) at which some of these purchases happened, a financial position by CytRx that does not appear too distressed and the fact that the CEO of CytRx, Mr. Steven Kriegsman, sits on RXi’s Board of Directors. It was apparent that this must be a question that RXi is often asked, and while Noah Beerman did not want to speak on behalf of CytRx, he told me to listen to Mr. Kriegsman’s own words on the RXi stock issue. So I did. What Mr. Kriegsman said in conference presentations (paraphrasing now) is that isn’t it nice to be able to use RXi as a piggy bank, but isn’t it also nice at the same time to be still the largest owner of RXII shares (~17% of outstanding) in case that RXII goes up for a change. Since RXi has strictly served CytRx as a piggy bank thus far, RXi shareholders will hope that the rest of the comments were not but some empty words.

Benitec/CSIRO Win Major Patent Battle in US

One of the sadder stories in RNAi Therapeutics history is the many years lost in the commercial development of drugs based on DNA-directed RNAi (ddRNAi) as the space had become embroiled in litigation instead of investing in the science. In a sign that this chapter may be behind us and that ddRNAi Therapeutics can now look forward to a time where the significant medical potential of the technology can be realized, the USPTO Board of Patent Appeals and Interferences (BPAI) just reversed an earlier (2008) decision to revoke the previously issued and fundamental Graham patent that is controlled by Benitec and CSIRO. This had followed a re-exam prompted by their archrival Nucleonics Inc, now bankrupt and buried on the corporate graveyard underneath its legal bills.

Benitec shares went up 50% on the news.

The Graham patent as issued first in 2003 broadly covered the use of double-stranded DNA capable of driving the expression of double-stranded RNAs (dsRNA) for sequence-specific gene silencing in animal cells. The compositions included the expression of sense and antisense RNAs from either separate promoters or in the form of a self-complementary hairpin RNA from a shared promoter. Because the latter construction (single promoter) is the commercially more valuable claim, it will be the focus of my following discussion.

The previous re-examiner had rejected these claims as obvious in light of the famous Fire and Mello studies where the Nobel Laureates (btw, watch out for announcements next week- microRNAs this time?) applied dsRNA (not dsDNA) directly to animal cells and showed that it is in fact dsRNA and not antisense that is by far the more potent trigger for gene silencing. In a mixture of valid scientific speculation and boilerplate legal language, the Fire-Mello patent also contemplated dsRNA generated by transcription in animal cells as well as self-complementary RNAs as variations of the dsRNA RNAi trigger theme. The patent, however, does not provide examples that these methods in fact would work.

Specifically, this examiner argued that the claim in Graham covering the one promoter with the two identical gene copies in inverted orientation and separated by a ‘stuffer’ (i.e. driving the expression of hairpin RNAs) was obvious over Fire in light of antisense literature that described the use of hairpin structures at the end of antisense molecules so as to stabilize them from exonucleolytic degradation. The examiner therefore concluded that it would have been obvious to modify the Fire dsRNAs with hairpins to similarly stabilize them from degradation.

The new examiner, however, concluded that this is not so. In fact, since Fire-Mello already specifically stated that dsRNAs are naturally stable, more stable than antisense, changing this stable structure with things like hairpins would only have risked adversely affecting the stability of the dsRNA. That is, Fire-Mello in fact taught away from such modifications. Moreover, the dsRNA portion of the hairpin elements generated by the antisense stabilization technique would not have had the capacity for being silencing triggers themselves, whereas in Fire-Mello the dsRNA was the silencing trigger. Indeed, in order for the antisense to work efficiently, the target mRNA would first have to displace and disrupt the protective hairpin at the end. Thus, the hairpins in Graham and the antisense literatures served entirely different functions (Graham: efficient production of dsRNA; antisense: stabilization), and to draw such parallels was inappropriate.

In short, the USPTO found that RNAi is Not Antisense and reversed its earlier decision. As a result, when it comes to RNAi Therapeutics, the two fundamental patents are now Fire-Mello for the application of dsRNA to the target cells, and Graham for ddRNAi approaches.

Given the importance of the US market for the pharmaceutical industry, this decision has a number of implications for the RNAi IP landscape. First, of course, is that ddRNAi Therapeutics would likely require a license to Graham for their commercialization until ~2018 (priority date for Graham: 1998). Currently, there are two ddRNAi candidates in phase I clinical development, one for HIV by Benitec itself, and one for the treatment of cancer by US-based Gradalis; another one is a ddRNAi development candidate for HCV that originated with Benitec and is now with Tacere/Pfizer and appears close to the clinic. Considering the time it takes from discovery to the commercialization of new drug candidates and the so-called ‘research exception’, the demand for Graham as a gate-keeping ddRNAi therapeutic patent may therefore be somewhat limited.

Of more immediate financial benefit to Benitec could be the research and reagent market where there are a number of companies that have been selling ddRNAi vectors and transgenic RNAi mice and have yet to obtain a license from Benitec/CSIRO. Because of the complexities of the Benitec-CSIRO-Sigma relationship, we probably have to wait to hear more from the company about the anticipated financial impact here.

An even larger financial windfall would probably occur if CSIRO can get their ddRNAi patent issued for the plant field- despite Fire-Mello. It is CSIRO's dedication and attention to detail that was a major force in achieving the Herculean feat of turning around Graham.The financial windfall is due to the fact that, unlike therapeutics, ddRNAi plants are already a commercial reality and growing.

It is of note here that an interference proceeding against the Fire-Mello patent has been initiated by CSIRO and might even result in invalidating Fire-Mello altogether. In interference proceedings the aim is to determine the priority of patents (here Waterhouse vs Fire) that compete for coverage of the same subject matter, or at least subject matter that the USPTO holds to be the same. I indeed believe that there is a good chance that ddRNAi for plants will be found to have been conceived before Fire-Mello was. It is also possible that, in the end, Fire-Mello and Waterhouse will find a way to peacefully co-exist.

In the end, it is a relief that the USPTO did not lose sight of major themes in RNAi science and did not get lost in technical minutiae. It therefore also bodes well for should the time come that the Crooke antisense patents are moved to the frontlines of the patent battles. But wouldn’t it be great to wait next time until real drugs have been developed before fighting over the spoils?

PS: It seems like there have been major developments on another prominent RNAi patent front, the Tuschl Litigation. As reported on the RNAi Litigation blog, it appears as if UMass is becoming increasingly isolated, and any attempt to rescue the therapeutic value of Tuschl-I is getting less likely by the day.

Novartis Wake-Up Call for Alnylam

It is official now: Novartis will not exercise its $100M option to broadly license Alnylam’s RNAi trigger IP. This must come as a shock to Alnylam, about to lay off 25-30% of its workforce, which seemed to have taken the option exercise for granted. The news comes after failing to deliver on its promise last year to reach one or more platform deals. With all due respect for the management of Alnylam which has grown the company into the pre-eminent player in RNAi Therapeutics, this latest disappointment confirms that the company has somewhat lost touch with new RNAi Therapeutics realities and I can only hope that it will trigger a serious re-evaluation of the company’s attitude and strategy.

One of the new realities is that $100M is no chump change. $100M is for example twice as much as the market capitalizations of so-called 2^nd-tier RNAi Therapeutics companies such as Silence Therapeutics, RXi Pharmaceuticals, and Marina Biotech, and about 50% more than the market cap of the leading RNAi delivery company Tekmira. I expect these companies to thus be first in line as Novartis should seek to use the $100M instead to strengthen their RNAi Therapeutics efforts by acquiring basic RNAi Therapeutics capabilities and delivery technologies.

I accordingly do not believe that the Novartis decision is an indication that it has lost interest in RNAi Therapeutics. For one, it seems that Novartis, after a few quiet years, has raced to fully exercise the target picks under the original agreement with Alnylam before the October 12 deadline, and has been busy hiring people for RNAi Therapeutics development this year. Moreover, they recently bought an option on an RNAi Therapeutics drug candidate from Quark.

One can thus argue that the 30+ targets should keep Novartis more than busy during the time that Alnylam’s potentially fundamental RNAi trigger IP can be considered most valuable, until ~2021. Paying another $100M would have been for the added flexibility of being able to go after new targets the company may develop an interest in, especially since target discovery is a fast evolving field. But why pay another $100M when buying Tekmira for example would give them a lot of that flexibility (5 Alnylam-protected target picks yet to be exercised) as well as secure the leading RNAi Therapeutics delivery technology. For their interests in direct RNAi applications, especially in the ocular disease area, $100M would also go a long way with gaining technology access to RXi Pharmaceuticals' self-delivering rxRNAs which should be of use there. And in terms of general RNAi Therapeutics capabilities, Silence Therapeutics should be quite attractive, and it is therefore also Novartis that is on top of my list of suitors for that company which not long ago announced that they are in talks about a potential takeover.

The Novartis decision, of course, also raises questions about Alnylam’s gate-keeping position in the RNAi trigger arena. With Kreutzer-Limmer embattled in Europe and seemingly having problems to gain traction in the US, Tuschl II thus far being limited to a method of siRNA formation by hybridization and about to be re-examined in Europe and subject to a major litigation in the US about the control of key mammalian and 3’ overhang data (for the latest developments, visit the 'RNAi Litigation' blog), and competitors, especially Silence Therapeutics and RXi Pharmaceuticals, adjusting to the emerging RNAi trigger IP landscape and coming out with reasonable workarounds, these questions are valid. And the more I see Alnylam shifting the focus on the ISIS patents as being gate-keeping to RNAi Therapeutics, the less faith I have in its IP position being gate-keeping.

One unknown is how much the uncertainties around Tuschl II, especially the litigation, played part in Novartis’ decision. If it indeed was critical and there is a paper trail to support that, then it may at least be a blessing for the Tuschl II litigation as the loss of $100M and much more in potential milestones can certainly be considered ‘irreparable harm’.

Alnylam, Alnylam…at least it has $300M+ left which should tide it over to a post-RNAi consolidation period when its deal-making clout should increase again. This, however, will not happen automatically and requires a change of tactics. Controlling access to the most advanced delivery technologies should be on top of the agenda. If I were Alnylam, I’d be looking to join forces with Roche or another potential platform partner to buy out Tekmira before Novartis does. Alternatively, I'd be looking to acquire $40M market cap Silence Therapeutics which I consider to be a major impediment for Alnylam to extract $300M+ for platform deals anytime soon. But given the timing of the Silence Therapeutics speculation and last night's news, it is possible that Novartis may already have lined up Silence Therapeutics.

To speculate on these important questions, please take part in the survey on the right hand column.

More background and thoughts on the Novartis decision can be found in the following blog entries:

1) Upcoming $100M Novartis Decision to Shake Up RNAi Therapeutics;

2) Is Novartis' Kidney RNAi Drug Deal Part of its Grand RNAi Therapeutics Strategy?;

3) RNAi Therapeutics Portfolio Review: Preparing for Novartis

RXi Pharmaceuticals Continues String of Sensible RNAi Delivery Collaborations

After deciding to focus on the use of so-called ‘self-delivering’ siRNAs (‘sd-rxRNA’) for dermatology and ophthalmology applications, RXi Pharmaceuticals has since entered into a number of relationships with companies to facilitate the uptake of sd-rxRNA in various organs.

The latest such technology partnership with EyeGate Pharmaceuticals for ocular direct RNAi applications follows another direct RNAi delivery partnership in dermatology with TransDerm and a collaboration with Philips Electronics for developing image-guided ultrasound-mediated siRNA delivery technologies. While the long-awaited and much-rumored deals that should bring in non-dilutive funding are still lacking, these steps promise the efficient development of RXi’s RNAi Therapeutics platform by tapping into what appear to be companies with complementary know-how and technologies. If successful, the technologies developed as a result of these partnerships may well pave the way for these Big Pharma partnerships that RXi and its investors so crave.

A common theme of these collaborations is that the partner provides technologies that, through largely physical methods (electrical currents, ultrasound, microneedle injections etc), should allow for the co-localization of the sd-rxRNA with the target cells, after which RXi’s chemistry kicks in to overcome the formidable cellular lipid membrane barrier and induce RNAi gene knockdown- all without the need for nanoparticle formulation.

The relationship with EyeGate also addresses a problem generally facing the development of ocular drugs, particularly those for back-of-the-eye disorders tied to severe vision loss: patient-friendly modes of drug administrations. While the rapidly increasing genetic insights into eye diseases has yielded a number of excellent gene targets, there is considerable doubt whether drugs such as the monoclonal antibody Lucentis for wet age-related macular degeneration are viable in the long run as they need to be injected into the eye by needle every 1-3 months with each administration carrying with it an incremental risk of serious adverse events such as retinal detachments.

One way of addressing this problem is through the development of sustained-release formulations where a depot of drug is placed in the eye which releases drug over time. Another promising approach are gene therapies which may need to be administered only once or twice in a life-time, and may even offer the prospect for real cures. A third approach, the one taken by EyeGate, is to use iontophoresis whereby low electrical currents are applied to generate ions that repulse like-charged drug molecules, appropriately formulated, and push them across the outer sclera to be distributed throughout the eye. Because this technique does not involve needle injections and instead works by placing electrodes on top of the eye, it should be relatively patient friendly. EyeGate is currently in late-stage development of a drug candidate delivered by its proprietary iontophoresis technology.

It is, of course, worth keeping in mind that such collaborations will take time before we will see resulting technologies move into the clinic. Nevertheless, one thing is clear: RXi Pharmaceuticals is highly competitive in attracting qualified partners in the area of conjugate/self-delivering siRNA Therapeutics development. Probably the result of focusing their efforts on one segment of RNAi Therapeutics technology instead of trying to dominate them all. It is now time, however, to leverage the sd-rxRNA platform for that non-dilutive funding.

Tekmira Delays Hypercholesterolemia Candidate: 2nd Gen Growing Pains or is it ApoB after all?

Tekmira’s ambition to grow a substantial clinical pipeline suffered a setback when it announced today that the IND for its candidate for the treatment of hypercholesterolemia, TKM-ApoB, has been delayed following a review of pre-clinical data. These data indicated that the ‘performance characteristics of the specific lipid nanoparticle formulation [...] have not met the Company’s expectations for the intended application'. This is the second substantial delay of Tekmira's pioneering ApoB program, and comes after the abandonment of a first ApoB candidate earlier this year.

The press release makes it very difficult to understand what the reason for the delay could have been. Given that LNP-siRNA delivery has been successfully demonstrated in hundreds of non-human primates, I have a hard time believing that they suddenly could not find a formulation that was able to potently knock down ApoB in the IND-enabling large animal studies. Even if they had some problems, it should not have led to an open-ended delay. I also don’t think that they could not get rid of the innate immunostimulatory potential of the siRNA they have been working with, because Tekmira had said that new modification patterns for this siRNA were able to abrogate immune stimulation also in the more sensitive ‘whole blood assay’ that they had developed. On the other hand, a clinically desirable profile for a given indication does consist of many more aspects besides potency and immune issues. Given that 2^nd gen formulations are relatively recent, whereas DLinDMA-based 1^st gen formulations have been quite thoroughly studied, some 2nd gen-related growing pains might be expected.

There have been questions raised about ApoB as a safe target for the treatment of hypercholesterolemia. Data in the RNAi literature itself and from the clinical program of ApoB-antisense molecule mipomersen (ISIS/Genzyme) show that inhibiting ApoB causes some, and sometimes indeed very significant accumulation of fat in the liver. While the medical importance is not clear yet, fatty liver and associated elevations in liver enzymes have raised some concerns. If Tekmira indeed sees the same toxicities that Mirus/Roche and Alnylam have seen (Marina Biotech and RXi also seem to have given up on ApoB), then it may be in the Company’s best interest to abandon the program. Accordingly, the press release was quick to highlight that the development of the company’s other 2 development candidates, one for solid cancers (TKM-PLK1) and one for Ebola infection (TKM-EBOLA) would be accelerated.

TKM-ApoB is also a particularly challenging indication as hypercholesterolemia is a chronic condition where you would have to safely administer a drug for sustained periods of time. Moreover, the regulatory bar for cardiovascular drug candidates has been raised quite a bit in recent years, especially in the US (outcome studies for most populations and increased safety scrutiny). The acute cancer and infectious disease indications may therefore be clinically more straightforward candidates to develop and, with Ebola, also offer earlier financial returns.

What speaks against the abandonment of ApoB as a target were references in the press release that the company would continue to study other formulations with ApoB. This, however, could also be interpreted as boilerplate or even a political move given that ApoB represents one of the five target picks from Alnylam and for that reason alone Tekmira may want to keep it alive at least on paper.

Overall, I am disappointed that the opportunity for TKM-ApoB to provide unequivocal clinical proof-of-concept data of potent gene knockdown with LNP-siRNA in the near-term will be missed. This now falls on the shoulder of Alnylam’s TTR program.

While clearly a bearish development, today’s news also provide some reason for optimism. One is that the strategic re-organization should be slightly positive for Tekmira’s finances as the new lead programs will be partly (PLK1- probably Alnylam and possible NCI support newly mentioned) and fully (Ebola) funded by others. Moreover, the company understands the importance of credible public relations by admitting to difficulties and calling disappointments what they are. It is also not pushing programs into the clinic because it is attractive to do so in the short-term: bonuses for the achievement of milestones; a relatively strong share price especially good if management does not intend to be there in the long run and a sale of the company was intended, etc- we’ve seen it all.

Just as RNAi Therapeutics was heating up, today is a humble reminder that in drug development setbacks can crop up when they are least expected. It will be important for the company to provide more clarity on today's development in the coming weeks, at least to the extent that it does not compromise their strategic position in RNAi triggers.

Breaking News: Silence Therapeutics Confirms ‘Approach’ which may Lead to Offer

My guess: Pfizer or Novartis.

I have just returned from a vacation on the beautiful island of Taiwan that also allowed me, finally away from my laptop, to reflect on RNAi Therapeutics and the financial markets. At the end of it (I just returned four hours ago), I was quite positive that the markets for high-risk/hi-reward investments such as RNAi Therapeutics have just hit rock bottom and that the survivors of the shake-out are poised to be among the best performers in the stock market as the dead money sitting in large companies’ coffers and the deceptively safe gold and bond market will find its way back again into small biotech companies in search of higher yields as a double-dip recession appears less likely by the day. Combined with the upcoming $100M Novartis decision and clinical data from particularly the SNALP/LNP-based trials (TKM-ApoB, ALN-TTR…), this should indeed be a very good time to be invested in RNAi Therapeutics.

If you follow this blog over time, you will have noticed that I have become much more bullish about Silence Therapeutics as it may well be a valuable addition to the RNAi Therapeutics efforts of a few Big Pharma companies. Today then, the company announced that the company has received an ‘approach which may or may not lead to an offer for the company’, with details yet to be released.

Novartis is such a Big Pharma that might benefit from a Silence acquisition and maybe not so coincidentally has also recently expressed some confidence in Silence Therapeutics RNAi platform when it optioned an RNAi clinical candidate that is based on the Silence Atu-RNAi trigger design. By exercising the $100M Alnylam option and complementing the RNAi trigger IP position with some of the valuable pieces controlled by Silence and that have recently started to issue, Novartis may well end up with one of the strongest, if not THE strongest position in RNAi triggers. It is also my feeling that although Novartis has apparently been on an RNAi Therapeutics hiring campaign, its technical expertise still lags behind that of pure-play companies such as Silence Therapeutics.

An acquisition of Silence Therapeutics may allow Pfizer, which like Novartis has also invested serious money in a clinical candidate based on the Atu-siRNA platform, to finally formulate its RNAi trigger strategy and get a start in delivery, too. In general, Pfizer to me has been a bit directionless in RNAi Therapeutics and risks missing its stated goal of an in-house RNAi Therapeutics IND in the near-term. Silence Therapeutics may help them remove a lot of the question marks over their RNAi efforts.

The offer price? Considering the recent share price before the offer (4.6p-7.5p) in light of the valuation of the merger with Intradigm (slightly above 20p just 8 months ago) and the stage of Silence Therapeutics' technology and IP position (increasingly solid in the RNAi trigger arena, encouraging in delivery), I would consider an offer price in the 20-25p range to be acceptable to Silence Therapeutics.

If you haven’t invested in Silence Therapeutics, I wouldn’t be too disappointed in the possibly missed opportunity here. First of all, it’s not a done deal yet, and more interestingly there are a few other companies out there whose shares should catch fire if a solid buy-out offer indeed emerges. Shares in Tekmira, RXi Pharmaceuticals, and mdRNA may be the primary beneficiaries due to their low market caps and because they might be considered by the markets to potentially be of similar strategic value to Big Pharma. Shares of Alnylam should also respond quite positively to such news, because it would confirm Big Pharma’s strong interest in RNAi Therapeutics and Alnylam being the bellwether of RNAi Therapeutics.

Please let it be true, please… J