The Pfizer-Tekmira Deal: More than Meets the Eye?

In yet another sign that interest in RNAi Therapeutics Big Pharma is picking up again, Tekmira today announced the initiation of a research collaboration with Pfizer focused on its SNALP siRNA delivery technology. This trend follows a number of proof-of-concept studies over the last year not only in non-human primates, but increasingly also in Man, which in aggregate are allaying much of the concerns caused by the findings that non-specific, innate immune responses had been responsible for a number of early RNAi in vivo study results (see study and review by Tekmira scientists).

In Tekmira, Pfizer is certainly choosing a leader in the development of RNAi into a clinical reality, and despite the early stage of this relationship, this could harbor the seeds of much more to come. This is not only because the two research teams should be a good cultural fit, but also because Tekmira could become a central piece in Pfizer’s strategy of RNAi Therapeutics as a platform. Sure, Pfizer has been active with a number of deals in the space, including an eye disease collaboration with Quark and a DNA-directed RNAi approach for HCV with Tacere, but following its acquisition of Coley as the launching pad for RNAi Therapeutics, it has yet to decide on where it will get the fundamental IP from in terms of RNAi triggers and also has not committed yet to any particular delivery technology. Given this delay, I have therefore come to believe that Pfizer may pursue a strategy that includes a concerted move in both trigger and delivery.

It is no secret that there is a certain tension in what Tekmira feels it deserves from Alnylam, and what Alnylam is willing to pay. Clearly, SNALP delivery must have accounted for a significant part of the financials Alnylam achieved in the Roche and Takeda platform alliances. One important corporate development goal of Tekmira is therefore to create enough know-how and IP that Alnylam does not control so that Alnylam cannot take it any more for granted, and with more options create best shareholder value. Pfizer could be Tekmira’s white knight because it is also fair to assume, as evidenced by the persistent patent oppositions by Pfizer against Alnylam especially in Europe, that Pfizer would prefer not to pay Alnylam $300M upfront for a platform license. What better way to gain leverage over Alnylam than by building a relationship with Tekmira on whose technology Alnylam has build so much of its pipeline and business development?

The main reason why Tekmira does not sport an RXi-like $100M market cap, despite vastly superior enabling technology and financials, is because it does not claim to have proprietary RNAi triggers. One could therefore argue that if somebody like Pfizer decided that it did not need Alnylam’s RNAi trigger IP, combining Tekmira’s SNALP technology with an RNAi trigger workaround solution (e.g. blunt-ended siRNA’s depending on the Tuschl outcome) would create synergies that would easily justify a Mirus-type price tag for Tekmira. Given the recent impressive share price performance of RXII, I would not want to exclude that RXi Pharmaceuticals could feature in this equation.

One way of interpreting today’s news is therefore as yet another important validation of SNALP technology by a Big Pharma, all the more important since with Pfizer SNALP’s potential technology risks have passed the most critical smell test, innate immune activation and liver toxicity (Coley and Tekmira’s precursor Inex used to compete on TLR therapeutics), but with modest immediate financial implications. Behind hit, however, could be the beginning of the end of Tekmira as we know it. With the platform adoption option date coming up, Novartis may also want to have a say in this.