RNAi Therapeutics Companies Cashed Up and Ready to Strike

With the $36M fund-raising last night, Arrowhead Research has become the 4^th publicly traded RNAi Therapeutics company in short succession to cash up for a real shot at drug development success.  The other companies are Tekmira, RXi Pharmaceuticals, and as it was made official this morning, Silence Therapeutics.

The money will be spent on promising drug candidates in the cancer field (TKM-PLK1, Atu027), chronic HBV (ARC520), and scarless wound healing (RXI-109) without having to take dangerous short-cuts or partner the crown jewels prematurely.  Moreover, it will help to advance critical delivery technologies such as DPC, SNALP, and self-delivering RNAi triggers which should provide for non-dilutive partnering opportunities without having to entertain low-ball offers.   

It is notable (and not surprising) that unlike Marina Biotech and Benitec which so far have failed to similarly escape the financing maelstro, Tekmira, Arrowhead and Silence all sport healthy in-house R&D operations.  RXi does not have such operations- yet.  However, they were critical for bringing RXI109 into the clinic on which the company’s ~$80-90M market cap rests.   

The cash infusions should also give the companies, which among them own most of the leading platform technologies, the opportunity to make up for the 20-30 fold gap in valuation to the likes of ISIS Pharmaceuticals (2.3B market cap in antisense), Alnylam (1.5B market cap in RNAi), and Sarepta (1B market cap for a phase II orphan indication).  If monoclonal antibodies are any guide, this will not play out as the winner-takes-all the public markets have it right now.

Below is a quick rundown of the newly cashed-up crop of RNAi Therapeutics companies for those new to the field.

Disclosure: I am long Tekmira and Arrowhead Research. 

Disclaimer: Investments in RNAi Therapeutics carry more risks than you want to know and think about.  The following can only be a very brief teaser for you to start your own due diligence.

Arrowhead Research: In the pursuit of a cure for chronic HBV

Market cap: ~60-70M (of which ~$35M in cash)

Unless Arrowhead Research comes up with a compelling orphan drug application of its technology when it will disclose its second development program in H1 2014, investment success will hinge on the fate of ARC520.  ARC520 is Arrowhead's unique attempt at a functional cure for chronic HBV that will enter clinical development shortly.  I interpret last night’s fund raising in that the IND-enabling tox studies were positive.  The results of these will be critical in determining whether ARC520 can be dosed high enough to safely achieve the type of 90% HBsAg reductions that will be required for that lofty goal.

With cash of around $35M, Arrowhead can now retain full rights to that program at least after value-inflecting phase I proof-of-concept knockdowns have been achieved.  To extend the cash runway beyond the predicted ~2 years, Arrowhead owns the exciting Dynamic PolyConjugate delivery technology, particularly the subcutaneous version and potential new developments for cancer applications.  DPC offers an obvious non-dilutive funding opportunity.

Having slept over the announcement of the PIPE financing which doubles the share count near multi-year lows, I believe it still was a good one in a difficult situation.  Potential partners would have liked to exploit the financial weakness of Arrowhead and the fast-money crowd (think Dawson and Rodman) would have liked to reap risk-free gains from trading around a public offering.  Instead, Arrowhead seems to have found one or more significant investors that share the vision with management.  It is comforting that besides the sweet entry price, no special gifts in the form of warrants and otherwise seemed to have been handed out.  No wonder Arrowhead closed up 13% the day after the financing.

Upcoming catalysts:

  - Determination of maximally tolerated dose in volunteer study with ARC520;

-          - DPC partnering (always on the table);

-          - Modest ALN-TTRsc results would emphasize value of DPC (mid-2013) and may get Alnylam into  play;  

-          - DPC data on cancer (probably H1 2013);

-          - Nominating new development candidate (Q2 2014);

-          - ARC520 viral knockdown results in the Hong Kong trial (H1 2014).

Tekmira Pharmaceuticals: Quality Technology, Quality Financial Management

Market cap: ~$70M (of which ~$40M in cash)

If you are looking for relative stability in RNAi Therapeutics, Tekmira could be attractive.  It was its SNALP technology that enabled the current revival (with well over $300M capital inflows in the industry in the first 4 months of this year) and remains one of the two leading systemic delivery technologies with the value possibly shifting towards oncology indications.  Its leading development candidate, TKM-PLK1 for solid cancers, is about to enter phase II studies and has yielded promising dose-related evidenceof efficacy in phase I. 

The company’s aerosolized LNPs could be an unanticipated windfall for investors, although I have yet to see the all-important safety data.  Its Ebola biodefense program is not valued much by the market, but has been an important stabilizing factor for the company in terms of funding and represents an attractive commercial opportunity in its own right.  

Upcoming catalysts:

-          - TKM-PLK1 data from the expansion cohort (H2 2013);

-          - Design and initiation of phase II studies for TKM-PLK1 (H2 2013);

-          - Follow-up candidate and potentially data for TKM-EBOLA (H2 2013);

-          - Nomination of new development candidate;

-          - $5M milestones each if ALN-TTR02 by Alnylam enters phase III development and Ascletis   initiates a trial in China with ALN-VSP02 for primary liver cancer (both H2 2013/H1 2014);

-          - Partnering of SNALP delivery technology, also for non-RNAi, non-therapeutic applications (always on the table);

       - Monetization of Talon royalties (uncertain timing if at all) 

Silence Therapeutics: A novel cancer approach and strong purchasing power

Market cap: ~150M (of which $30-35M in cash)

Following a remarkable financial turnaround and management reshuffle, Silence Therapeutics has become a force to be reckoned with once again.  Unlike in the early days, it is the product candidates, and not RNAi trigger IP, that is the focus of the New Silence.

First and foremost is Atu027, an endothelially targeted RNAi Therapeutics aimed at preventing cancer metastasis.  The company believes that Atu027 will be most useful in combination with small molecules that aim at killing primary tumor cells and consequently is about to initiate phase Ib/phase II combination trials.

According to the information in the latest financing (which was approved today), a significant investment will be made in building a broader pipeline.  This will take advantage of the company’s three lipid-based delivery technologies: Atuplex (broad endothelial cells), DACC (lung endothelial cells), and DBTC (cells in the liver).  In general, the market cap and cash infusion position the company well to pick up some distressed RNAi and other assets.

Upcoming catalysts:

-          - Initiation of pancreatic cancer combination trial with Atu027 (H2 2013);

-          - Nominating new development candidate(s) (H2 2013);

-          - Pre-clinical data on liver delivery technology (2013);

-          - Partnering, also for non-RNAi, non-therapeutic applications

RXi Pharmaceuticals: Just dermal anti-scarring no more  

Market cap: $80-90M (of which ~$20M in cash)

RXi Pharmaceuticals is the company that popularized the self-delivering RNAi trigger concept.  Unfortunately for the company, it made a critical IP mistake of staying clear of the most potent versions it could have created with its ideas (à dsRNA length).  Furthermore, it seemed that it never was able to get anything into the clinic.

This changed last year with phase I initiation for RXI-109, a potentially superior alternative to Pfizer’s antisense-based dermal anti-scarring candidate.  However, as part of a reorganization, it essentially got rid of its R&D to focus all resources on RXI-109.

As you know, getting rid of in-house R&D is a mortal mistake if you want to be a platform-based company.  With the recent $16.4M cash infusion by OpkoHealth it will be interesting to watch whether they can become a self-delivering RNAi trigger platform-based candidate again, or whether the claimed company growth will largely be around expanding the indications of RXI-109 to other anti-fibrotic indications, especially ocular ones.

Upcoming catalyst:

-          Presentation of phase I data from RXI-109 (any day).

Mirna Therapeutics Brings First MicroRNA Replacement Therapy into Clinic

It has been a long wait, but 5 years following the initiation of anti-miR122 development for the treatment of HCV infection by Santaris, a second microRNA Therapeutics has now entered clinical development.  MRX34 by Mirna Therapeutics is a miR-34a replacement therapy for the treatment of liver cancer or cancers with liver involvement.  

MicroRNA replacement therapy is technically very similar to RNAi Therapeutics.  It involves adding to cells naturally occurring microRNAs to orchestrate typically a range of processes deemed to be therapeutic.  It is added to cells in the form of double-stranded RNA triggers very much alike RNAi triggers and can therefore largely utilize the same types of delivery approaches.  The delivery technology for MRX34 is the NOV340 SMARTICLE technology owned by Marina Biotech.  This liposomal delivery technology is distinct from SNALP, most notably by employing ionizable ‘amphoteric’ lipids, lipids that can take on both positive and negative charge depending on pH, and not ionizable cationic lipids, lipids that merely become positively charged at acidic pH, as in the case of SNALPs. 

An extensive literature supports miR-34a as an exciting microRNA for replacement therapy in cancer rivaling the most famous let-7.  Accordingly, miR-34 emerged as Mirna Therapeutics’ top priority based on extensive screening conducted at Ambion (now Life Technologies) from which Mirna Therapeutics was spun out.  Under transcriptional control by the guardian of the genome, p53, its pleiotropic effects range from cell cycle inhibition, to counter-acting anti-apoptotic mechanisms and to sensitizing towards chemotherapy.  The choice of liver-related cancers was thus not based on cancer biology (many cancers cancers would apply), but largely a function of where the company thinks NOV340 can deliver to.

This to me raises again the question of whether liver cancer is closer to normal liver or whether it is closer to solid tumors in general in terms of delivery.  MRX34 thus follows Alnylam’s reasonings as manifested by ALN-VSP02, but goes against what is known about blood supply differences between normal liver and liver cancer and what is practiced by the likes of Tekmira and Dicerna.

The phase I study will be a typical dose-escalation study seeking to determine the maximally tolerated dose.  Given the importance of delivery, close attention should be paid to the pharmacokinetic and biodistribution data from this trial.  These should start to become available in the first half of 2014.

The development is positive for at least two other companies.  As the provider of the delivery technology, Marina Biotech obviously stands to gain financially and otherwise from such clinical milestones.  Whether it will be sufficient to pay off its debts that have come due and consequently avert bankruptcy is an open question.  Due to the financial distress, Marina Biotech struggled to enter into deals giving it fair compensation for its technology.

Although the most direct competitor to Mirna Therapeutics, InteRNA as the other major microRNA replacement company in oncology should also benefit from the initiation of the phase I study as it helps to validate its approach.  The question will be whether among its stable of microRNA replacement candidates, there are some with as robust activities as miR-34a.   

BMS Partners with Santaris

In other recent news related to microRNA Therapeutics, Big Pharma Bristol-Myers Squibb partnered with LNA antisense company Santaris under which the Danish company collected $10M upfront.  Although the press release did not specify much the aims of the the alliance, referring to RNA Therapeutics broadly, a few factors speak in favor of microRNAs being involved.  

Most notably, BMS had terminated an phosphorothioate RNaseH antisense collaboration with ISIS Pharmaceuticals.  As Santaris in turn had terminated their PCSK9 phosphorothioate RNaseH antisense program as well, most likely due to kidney toxicity (--> phosphorothioate chemistry as also in Prosensa; van Poelgeest et al. 2013), the first suspicion that BMS sought out Santaris as a more potent PCSK9 alternative becomes less compelling.  Moreover, ISIS Pharmaceuticals is suing Santaris over US patent infringement of RNaseH technology which should hinder the ability of Santaris to enter into relationships with US companies for RNaseH antisense purposes.  Of course, the deal could also indicate that a settlement is in the making...

Let’s Go to San Francisco: Trends from the 4th RNAi Research and Therapeutics Conference

Still looking for an interesting RNAi Therapeutics conference to attend? The 4^th RNAi Research&Therapeutics conference to be held in San Francisco June 20-21 may be a good choice to satisfy your cravings for not only RNAi Therapeutics research and development, but also the wider applications of RNAi gene silencing for target identification and new interesting trends in targeting non-coding RNAs.

Register with discount code ‘RNABLG13’ for 20% discount and free RNAi Therapeutics blog T-shirt here.

Reading through the abstracts of conferences like this one is helpful in understanding the trends in a scientific field.  As an appetizer, the following will highlight a few of those promising scientific directions, challenges, and future investment flows as seen through the lens of an RNAi Therapeutics nerd.

Delivery, delivery, delivery

An old headline, but as the key value-driving effort, delivery naturally is a focus of an RNAi Therapeutics conference.  Importantly, the two most advanced and promising systemic delivery technologies, SNALP/LNPs and DPCs, are represented.  Pieter Cullis, an academician with ties to the Tekmira, AlCana, and Alnylam love triangle, will be talking about Tekmira-type LNPs.  Interestingly, while these LNPs are known to have applications for knocking down genes in the liver, solid tumors, and potentially sites of inflammation and lung epithelia in aerosolized form, the abstract notes their use in the central nervous system (CNS) for serious neurological disorders.  Of course, the CNS is the organ with many of the major unaddressed medical needs, so I am curious whether there will be actual data showing good distribution and efficacy of LNPs in this organ.  While I consider the CNS challenging in terms of achieving wide distribution with direct administered nanoparticle-based delivery technologies, the immune challenges of nanoparticles, including complement activation and phagocytic uptake, might be lessened in this organ.

David Lewis from Arrowhead Research will present the latest about the exciting DPC delivery technology, including data from the chronic HBV program (ARC520).  By then, IND-enabling tox studies for ARC520 should be completed and the first DPC-related IND filed.  His talk should also be of interest to those not as obsessed about DPCs as I am as he will speak about some of the mechanistic insights of the key endosomal escape process, insights which should be more broadly applicable.

Trinna Cuellar from Genentech will be speaking about ‘A systematic evaluation of antibody-mediated siRNA delivery and silencing’.  It seems that Genentech hopes to create RNAi Therapeutics value based on its expertise in monoclonal antibody pharmacology.  The talk should elucidate whether the strategy envisions only minimal antibody-siRNA conjugates, or whether it further embraces other delivery platforms.  Of note, Tekmira once mentioned that it had a technology evaluation with Genentech on antibody-targeted SNALPs and made the bold prediction that ‘Roche will be back’.

Curiously, not one but three presentations concern aptamer-targeted RNAi trigger delivery (note: aptamers are antibody-like nucleic acids).  We have had a number of reports of such aptamer-siRNAs, especially for cancer and HIV infection.  However, these reports have encountered much disbelief, especially since they lacked an explanation for their postulated endosomal escape.  With credible knockdown activity reported with the GalNAc-siRNA conjugates by Alnylam, aptamer-RNAi triggers should be similarly gaining in credibility, especially when combined with self-delivering RNAi trigger chemistries.  An experiment that I would like to see as part of the field regaining credibility is an ASGPR-targeted aptamer-RNAi trigger conjugate (ASGPR is the receptor targeted by the GalNAc sugar).  In addition to building confidence in the approach, it would also be an alternative to GalNAc-RNAi triggers should the sugar moiety cause injection site reactions in humans.

Some of the aptamer-RNAi trigger presentations also touch on the subject of bifunctional RNAi Therapeutics, meaning RNAi Therapeutics formulations with a second non-RNAi therapeutic activity.  These secondary activities may include receptor blocking or toll-like receptor (TLR) activation as in a talk on CpG-STAT3 siRNAs by Hua Yu from the City of Hope.

In ddRNAi it is about the RNAi trigger design

The conference also includes presentations on microRNA processing and their implications for ddRNAi trigger design.  Unlike in RNAi Therapeutics induced by synthetic RNAi triggers, RNAi trigger design remains a crucial value-creating activity in DNA-directed RNAi Therapeutics.  Unfortunately, its importance has been entirely lost from the commercial field (if you really want to aggravate me, show me a U6-driven shRNA being put into clinical development).  Fortunately, academic efforts mean that ddRNAi trigger design continues to advance.

In his Keynote address, Mark Kay from Stanford University will present insights from his lab on microRNA processing and, crucially, how that knowledge can be put into practice for ddRNAi Therapeutics.  Especially recent work from Shuo Gu in his lab on Argonaute-specificity, strand selection, and Dicer processing have advanced this field and should also provide for fresh ddRNAi IP opportunities.  A presentation by Marco Weinberg from the Scripps Research Institute meanwhile is focused on an earlier step in microRNA processing, the primary microRNA recognition and cleavage by the Drosha enzyme.  ddRNAi trigger cassettes requiring the Drosha processing step promise to be more natural and cell-specific alternatives.  

MicroRNAs hot, lncRNAs getting hot

Functionally closely related to RNAi, it is not surprising that the conference program includes microRNA Therapeutics.  As by far the most advanced microRNA Therapeutics program, the update on the anti-miR122 program by Santaris for HCV infection (phase II) will be a highlight for those that have not been paying close attention to the results.  For those more familiar with the story, it will be of interest how Santaris aims to position this innovative treatment approach in an increasingly crowded and competitive field.

There will also be presentations on long non-coding RNAs (lncRNAs) and their therapeutic use.  LncRNAs are RNAs that do not code for proteins and are usually expressed in between protein-coding genes or antisense to or just upstream of protein-coding genes.  As more and more examples of such functional non-coding RNAs emerge, a whole cottage industry has emerged to cater to them.  Interestingly, reports suggest that lncRNAs can often be suppressed by RNAi triggers.  This is a departure from the classical thought that RNAi triggers can only target protein-coding mRNAs.  Similar to microRNA antagonists, targeting lncRNAs that silence other genes, can activate gene expression.  Oligonucleotide research reagent companies have naturally recognized the commercial potential of this by offering large lncRNA-targeting RNAi trigger libraries and Zaklina Strezoska will present the design approach by Thermo Fisher.

RNAi trigger libraries are also the focus of presentations by Michael McManus from UCSF and Iain Fraser from the NIH.  These researchers employ the libraries for understanding biological processes, an effort that is also suitable for new drug target identification.  The library approach by McManus is unique in that every gene is targeted by many (~25) shRNAs.  This is done to increase the confidence that hits concern real targets and not just some off-target noise.  The approach is critically facilitated by next-generation sequencing (NGS).

Next-generation sequencing is also the focus of a late afternoon session at the conference.  Since NGS is ubiquitous in today’s research, keeping up-to-date on technological advances in this field is part of the homework of any RNAi Therapeutics buff.

The conference will finish on a Friday.  If you like to digest all the information and be inspired by nature at the same time, I recommend that you stay the weekend and rent a car to see some redwoods, coastline, and villages inhabited by eccentrics north of the Golden Gate Bridge.  Good weather guaranteed.

Register with discount code ‘RNABLG13’ for 20% discount and free RNAi Therapeutics blog T-shirt here

FDA Proactively Questions Eteplirsen Biomarker Methodology

Orphan drugs tailored to address defined genetic lesions account for a significant portion of the current value of RNA Therapeutics.  One of the reasons is that they promise much more economical approval pathways, including shorter timelines, smaller patient populations, and biomarker-based approval.  Following RNAse H antisense Kynamro by ISIS Pharmaceuticals/Genzyme Eteplirsen for homozygous FH, eteplirsen by Sarepta for Duchenne Muscular Dystrophy (DMD) offers us another front-row view of this process.

Currently, the question on most observers' minds is whether the biomarker data gathered so far, most notably from a phase IIb trial in just 12 patients is sufficient for accelerated approval (AA).  Towards this end, Sarepta and the FDA had a meeting a few weeks ago to discuss whether the FDA would accept for review such an AA submission.  According to the Minutes of the meeting which were discussed in a press release by Sarepta on Monday, the FDA does not believe the data it has seen warrants an AA submission and asked the company to come back with more data.

I am one of the very few open critics of eteplirsen and have explained my rationale why I have little confidence in the phase IIb data that have catalyzed much popular support: a manipulated trial conduct where essentially all the supportive evidence was collected after unblinding of the trial and a cherry-picking way of presenting them.

What emerged from the recent FDA interaction appears to be largely consistent with my concerns.  Today, I would like to highlight a critical issue when it comes to pursuing biomarker-based approval strategies and that was the focus of the recent interaction.

How you measure biomarker is as important as the biomarker per se

It does not reflect well on a company seeking accelerated approval when, after two decades or more of morpholino-based drug development, it has yet to establish sufficient manufacturing capacity to satisfy even the small patient population that would be eligible for eteplirsen.  The same poor planning becomes evident when the FDA appears to be questioning the method by which the biomarker (dystrophin) data was collected: what is the value of a biologically strong biomarker if you can’t reliably measure it to draw comparisons?

The dystrophin expression by immunofluorescence and Western blot were from biopsy samples.  Obviously, muscle tissue is everywhere in the body and any drug efficacy will vary depending on the muscle.  Even within a given muscle, (revertant) dystrophin expression is known to be variable in DMD patients, so despite of consistently taking biopsies from the same muscle before and after treatment, you may not be able to tell 2 or 3-fold differences.  This problem was noted by the investigators in the first phase II trial of eteplirsen in discussing the discrepancies of Western blot and immunofluorescence data.

Of course, this sampling issue could be addressed with large patient numbers, but not with the 12 as in this trial.  Given the importance of methodology, it is surprising that Sarepta missed the opportunity to provide the FDA with sufficient related information to be in a position to more conclusively tell whether it’s worth submitting for AA or not.

Issues the FDA might want to know more about could be the selection strategy of biopsy location and whether the antibody was appropriately chosen also for taking into account revertant fibers.  Revertant fibers are a phenomenon due to either secondary mutations or alternative splicing which leads to dystrophin expression in many DMD patients.  This might also shed light on for example why after 12 weeks on drugs, no dystrophin expression was seen, but at 24 weeks it was. 

Another important question that the detailed methods might answer is the quantitation of the absolute amount of dystrophin expression (not percent fibers expressing).  Based on the phase II study publication, it appears to be quite difficult to do even just semi-quantitative calculations on fuzzy Western blots.  Of course, once the real expression is established, the question is how functional such alternatively spliced (Becker-type) dystrophin is.  Maybe what you need is at least 30% of such dystrophin to have a functional impact on DMD.  

Sustained 6 MWT stabilizations common

Supporters of eteplirsen like to point out that the proof that it works is in the apparent disease stabilization over 52 weeks or more when measured in terms of the 6-minute-walk test.  However, it appears from natural history studies of DMD that such walking stabilizations are common.  In fact, depending on the age, you would even expect an increase in walking ability over 52 weeks.  Thus, arguing that the 6 MWT data are proof for drug efficacy is like arguing that Stable Disease in an uncontrolled cancer trial is evidence that a drug works.

Confounding the 6 MWT data is the fact that it is an effort-based test and that the separation between drug and placebo was only observed after unblinding of the data and dropping out the worst performers. In the very words of Sarepta itself and clinical collaborators when discussing clinical data from the competing exon-skipping drug by Prosensa and GSK:

'In terms of the clinical efficacy, the PRO051 study claims that eight of 11 boys who were ambulant at entry to the extension study showed improvement in the 6-min walking test of 35·2 m (SD 28·7) after 12 weeks' treatment; however, this change was not significant. Moreover, several of these children were younger than 7 years and, according to longitudinal observation, boys younger than 7 years with Duchenne muscular dystrophy gain motor function. Additional confounding factors are the variability in the walking test (SD 36 m) and the powerful placebo effect of open-label studies. Despite these limitations, this observation is encouraging.'

I don’t hold out myself to be an expert in DMD, but as a skeptical scientist I believe there remain too many open questions around the eteplirsen data and trial conduct to make me feel comfortable.  Add to this the almost religious support by a strange alliance of investors, patient groups, politicians, and journalists.  Spending half a million per patient per year on a drug that may turn out to be ineffective and have side effects would neither protect patients nor help the cause of RNA Therapeutics.  If patients are so keen on the drug, and I'm all in favor of patient choice, then why not provide them with eteplirsen based on compassionate use?

Last but not least, why newly Cambridge, Mass-based Sarepta had to issue the press release on the Minutes of their FDA meetings just minutes after the Boston marathon bomb blasts, is a mystery to me.

Disclosure: no position in Sarepta.

Register for the GTC RNAi Research and Therapeutics meeting in San Francisco today (June 20-21).  Get a free RNAi Therapeutics blog T-shirt and 20% discount on registration by entering discount code 'RNABLG13'.

RNAi Therapeutics Arriving in Oncology

Yesterday, Tekmira presented data from the dose escalation portion of the phase I trial with TKM-PLK1 for the treatment of solid tumors.  I agree with the company that the fact the drug candidate was associated with clinical benefit in 4 out of 9 evaluable patients receiving 0.6mg/kg or more versus no such association at dosages below is 'highly suggestive' that TKM-PLK1 has anti-tumor activity indeed.  I also agree with their decision to pursue the neuroendocrine tumor indication for their first phase II study later this year based on the present data.

What I would like to focus on today, however, is much more exciting data contained in the TKM-PLK1 data as it relates to RNAi delivery to oncology…the key obstacle in making RNAi Therapeutics work for cancer.  Specifically, the long-circulating 2^nd gen SNALP formulation employed in TKM-PLK1 exhibited vastly improved pharmacokinetics over the short-circulating 1^st gen SNALP formulation employed in Alnylam’s ALN-VSP02.  Whether cancer in the liver or not, long circulation times are critical in order to take advantage of the Enhanced Permeability and Retention (EPR) effect that is at the heart of nanoparticle-based approaches in oncology.

It is for this fact that I am optimistic that the ‘highly suggestive’ data (which you invariably will hear about in phase I cancer studies involving a mix of late-stage cancer patients such as this one) are for real.

10-Fold More siRNA at 24 hours

Slide 13 of the AACR presentation shows that at 24 hours, around 1500 nanograms siRNA was present in 1ml of serum at the maximally tolerated dose of 0.75mg/kg.  This compares to around 150 nanograms of combined KSP and VEGF siRNA per ml at this time point for ALN-VSP02 as presented at ASCO2011.  If you’ve ever been at the bench and performed siRNA transfections in tissue culture cells, 1.5 microgram siRNA in a ml of media is overkill, and in this case it is real tumors that are served by blood containing such large siRNA concentrations- for days.

Considering the PK profile, it is not surprising that the one paired tumor biopsy obtained so far showed RNAi activity according to 5’ RACE, whereas such detection was rare in the ALN-VSP02 trial.  Clearly, more tumor biopsies have to be taken in the dose extension phase of the study (which apparently is recruiting quite well).  This will also be important for assessing siRNA concentrations in the tumors themselves.

Selecting the Right Patients

A heterogeneous patient population as in this trial alone obviously makes it very difficult to select the right cancer types for future clinical development.  There are a number of biomarker strategies that Tekmira could, and in my opinion, should employ in their future development.

Based on target biology, the KRAS mutation status should be given high priority.  KRAS-driven cancers are thought to be highly dependent on PLK1 expression.  Related to this, PLK1 expression itself could be used as a guide in patient selection.

A more unusual strategy would be to use imaging technologies based on nanoparticles which presumably rely on the same EPR effect in order to assess whether the tumors are amenable to EPR effect (alternatively, a simpler perfusion test may provide similar insights).  I could imagine that the fact that neuroendocrine tumors seem to respond to TKM-PLK1 is a result of such a favored effect.  Finally, another (admittedly less likely) selection strategy considering delivery would be to target tumors with high expression levels of LDLR-like receptors which are thought to be important in the cellular uptake of SNALP particles.

And last but not least, for those that like to think of comparative values, with a much better target and PK profile over ALN-VSP02, TKM-PLK1 may now be considered the lead RNAi Therapeutics oncology candidate. 

Register for the GTC RNAi Research and Therapeutics meeting in San Francisco today (June 20-21).  Get a free RNAi Therapeutics blog T-shirt and 20% discount on registration by entering discount code 'RNABLG13'.

Dicerna Licenses Baulcombe Patents

Today, the technology licensing arm of The Sainsbury Laboratory and the John Innes Center in the UK (PBL) granted a non-exclusive license to Dicer-substrate company Dicerna for the therapeutic use of the recently emerged fundamental RNAi trigger IP, the Baulcombe patent family.  It follows a similar, non-exclusive license granted last year to Alnylam and confirms the importance of this patent family, especially for companies conducting research and business in the US where patents from this family have issued.

Although the terms, not just the financial ones, but also those regarding sublicensing rights were not disclosed, I would think that the payments are more than token amounts and that certain sublicensing rights are covered.  Notably, Dicerna has an important relationship with Japanese Pharma Kyowa Hakko from which it announced in January that it would receive a $5M milestone payment.  This could be construed to have infringed the patents at issue and provided the final motivation for the license.    

Given that the first therapeutic license was given to Alnylam which focuses on 20-23mer RNAi triggers and the second one to Dicerna which works on 26-29mers, it is interesting to speculate whether PBL aims to increase the attractiveness (and cost) of the non-exclusive license by providing exclusivities regarding specific RNAi trigger structures.  This question is an important one for companies like Silence Therapeutics as they might be shut out from the 20-30 base-pair range should this be the case.

Coming Up: TKM-PLK1 phase I data presentation by Tekmira at AACR. 

ISIS Pharmaceuticals Next-Gen cET Technology on Shaky Grounds

As I was listening to a presentation by ISIS satellite company Regulus Therapeutics at the Future Leaders in the Biotech Industry Conference last week, I noticed that the fight between ISIS/Regulus and Santaris over intellectual property has increased in bitterness. On the same day, Santaris announced that the USPTO had rebuffed the second patent challenge concerning its conformationally constrained nucleotide technology (LNA).  As ISIS and Regulus have decided on making the LNA-derived cET technology their next-generation antisense technology, the increased aggression (including an ongoing gapmer patent infringement suit brought by ISIS against Santaris) may indicate that also ISIS sees cET technology on shaky IP grounds.

Thanks for the Validation!

Even during the hard-fought Tekmira vs Alnylam battle, the participants largely refrained from making direct snarky comments.  This, however, cannot be said of last week’s presentation by Regulus, when it sarcastically thanked Santaris for being years ahead in their miR-122 HCV program and doing all the clinical validation- for them.  The comment obviously refers to the fact that Stanford University had licensed the seminal Sarnow patent related to miR-122 inhibition for HCV therapy to Regulus, not Santaris.  It is also what made GSK dump Santaris and partner with Regulus on the program instead.  I would agree that Regulus has a strong case in this matter, but the unmitigated sarcasm was remarkable.

Is it all about cET?

When ISISfirst reported on their next-generation (gen 2.5 that is) nucleotide modification, it (cET) was explicitly derived from LNAs.  The rationale was that although LNA is the most potent antisense technology around, it suffered from poor safety (as supported by the premature termination of the PCSK9 and ApoB programs by Santaris).  Consequently, additional moieties were incorporated into the bridge that fixes the conformation of the backbone ribose in place.  As a result, the high affinity of the parent LNA was retained, but the safety issues were apparently overcome.

As a LNA-derived technology, the obvious question is whether Santaris, which controls fundamental LNA patents, has IP rights in cET.  Given the importance of cET to ISIS Pharmaceuticals and Regulus such uncertainty is intolerable.  Hence, it would make sense for ISIS and Regulus to attack Santaris and its LNA patents, which is exactly what ISIS has been doing.  Two such pre-emptive strikes, however, have failed according to last week's news.  And as a pre-emptive reminder on my part, a patent only gives you the right to exclude, not freedom-to-operate.

The gapmer patent infringement suit against Santaris may thus be viewed as an effort to get Santaris to the negotiating table.  The miR-122 situation, albeit unrelated to the LNA issue, would be further ammunition to ISIS and Regulus in that effort.

Expect the confrontation to get heatier still, as Santaris should strike back as the overall strategy by ISIS Pharmaceuticals, which is continuing to closeone deal after the other, seems to be working despite the lost patent re-examination battles last week, and is taking away the financial oxygen from Santaris.

Register for the GTC RNAi Research and Therapeutics meeting in San Francisco today (June 20-21).  Get a free RNAi Therapeutics blog T-shirt and 20% discount on registration by entering discount code 'RNABLG13'.

RNA Therapeutics Has Gone Mainstream

When Mad Money host Jim Cramer on CNBC singles out RNATherapeutics as a sector to invest in and notable Big Pharma RNA Therapeutics deals materialize on a regular basis, you know that the industry has become accepted as mainstream.  This acceptance and confidence are critical for the financial viability of the industry and shareholder profitability, as it determines the terms at which the cash-burning companies can raise capital to mature and launch their first drugs.  Alnylam’s recent fund raising is the best example of that, and while almost all of the investor attention has been on bellwether companies and cult stocks such as Alnylam, ISIS Pharmaceuticals, Sarepta, and Regulus, the increased scrutiny should also benefit some of the smaller technology leaders such as (my own holdings in the space) Tekmira and Arrowhead Research.

Market Doing Homework

Drug development is attractive to me also from an investment point of view because it is one of the few opportunities where scientific insights should provide you with an investment edge.  Financial market gurus such as Jim Cramer feel quite comfortable talking about automobiles, electronics, restaurant chains and most other sectors of the economy, but you can sense that they are more uncomfortable when it comes to explaining why a certain biotechnology is worth investing in.  The fact that Jim Cramer had done some homework for the show and did his best to explain the basic promise of RNA Therapeutics is not only laudable, it speaks to the fact that mainstream market participants can ill afford to ignore this geeky sector any more, especially if your performance is measured in terms of peer performance.  This is because RNA Therapeutics hit the sweet spot of drug development today, which is personalized medicine and orphan diseases.  There are very few sectors like it where a number of companies can be expected to experience rapid growth almost regardless of what the wider economy does (well, at least until the next big correction/disruption).   

Big is Beautiful

A downside of it being a technologically driven sector dealing with complex biology and where strong recurrent revenues in the form of drug sales are lacking, is that most market participants prefer to invest with companies having the largest market caps.  This, of course, is based on the wisdom that since I do not even pretend to understand the gory details of the technology, the fact that companies have leading market caps must mean that I am probably investing along with more expert and diligent investors.  Moreover, the vast majority of investors looking for potential opportunities in RNAi Therapeutics or RNaseH antisense e.g. will come across Alnylam and ISIS Pharmaceuticals first and essentially stop there.  In Germany, you would refer to such behavior as the devil always shi**ing on the biggest pile.

Another problem for the smaller companies in the sector is that even $0.5-1.8 billion market caps are still small for the larger funds.  The technologically potentially more interesting ‘second-tier’ RNAi Therapeutics companies with 20-40 times smaller market caps are usually not an option.  Working on increasing awareness with the next larger investor group is therefore an important market-facing activity for these companies ahead of potential scientific and clinical trial catalysts.  As illustrated by the recent analyst event, Arrowhead Research is doing that ahead of its chronic HepB program entering the clinic, and I would not be surprised if Tekmira had done the same ahead of the important TKM-PLK1 phase I data presentation at the imminently upcoming AACR meeting.

Is This Time Different?

Having lived through the ups and downs of the financial fortunes of RNAi Therapeutics, watching the increased interest in the sector evokes old memories.  In particular, are we in the middle of another 2006-8 type bubble?  In 2006-8, most of the value was ascribed to RNAi trigger IP while neglecting the importance of delivery and the poor quality of the product candidates at the time.  With the value of RNAi trigger IP and leading product candidates evaporating, there was no place to hide during one of the worst financial crises of modern times and the bubble had to burst.

This time, however, a clinical pipeline of much higher quality and sales visibilities, not just in RNAi Therapeutics, but RNA Therapeutics at large, provide better support to some of the increased valuations.  Today, unlike back then, there is no question that RNAi Therapeutics and RNaseH antisense for example can knock down genes in humans profoundly.  The pipeline includes numerous opportunities for validating events in the form of biomarkers ensuring a constant newsflow to keep up interest, confidence, and valuations.  In fact, it is not just the more mature pipeline, with mipomersen, the first RNA Therapeutic with commercial potential to speak of (I expect the ‘symptomatic’ homozygous FH population to grow miraculously), has recently been approved. 

This, of course, does not shield from significant downside to investors of companies like Sarepta or Alnylam if their lead candidates suffer setbacks.  If major platform or delivery-related toxicities emerge, the fallout ought to spread and Jim Cramer will tell his audience to sell, sell, sell.

Register for the GTC RNAi Research and Therapeutics meeting in San Francisco today (June 20-21).  Get a free RNAi Therapeutics blog T-shirt and 20% discount on registration by entering discount code 'RNABLG13'.

Merck Hot on the Trails of Dynamic PolyConjugates by Arrowhead Research

Not only was I impressed by the Dynamic PolyConjugate delivery data presented at the late 2012 OTS meeting, many others in this peer group were, too.  This included favorable comments and keen questioning by a Merck scientist in the following Q&A session.  Not entirely surprising therefore, the presentation at OTS by Merck at the meeting revealed that it has recently shifted its delivery focus onto DPCs.  This week then, published evidence of that activity emerged in the form of a publication in Bioconjugate Chemistry (Parmar etal. 2013).  The DPC work described therein is consistent with a strategy in which the company aims at internally replicating the industry’s most promising/advanced delivery technologies, possibly hoping that not only can they overcome the scientific and manufacturing challenges, but also will find holes in the originator company’s intellectual property.  

Learning the DPC ABCs

The paper is essentially a replication of the basic DPC studies published in 2007 by Rozema et al. in PNAS.  Accordingly, they encountered much of the same challenges that the scientists at Arrowhead Research (formerly Mirus Bio, then Roche) had encountered in building the DPC delivery platform and includes issues with manufacturing yield and solubility.  The major difference is that Merck utilized a polymer backbone incorporating  disulfide bonds that one might hypothesize to be degraded in the reductive cytoplasm of cells. The fact that the first published Arrowhead DPC was not biodegradable was cited as a key toxicity issue.  All this is consistent with what Arrowhead started to report last year in explaining which challenges had to be overcome before they were able to clinically mature the technology.  Overall, the consistency of the findings with those first reported by Arrowhead gives me a good feeling about the theoretical basis for and robustness of the technology.

Lavishly Screening for Improvements

In order to discover suitable disulfide-containing polymers, Merck generated a small library of amphiphilic polymers by reacting together three types of chemical groups: an amine, an imidazole, and hydrophobic tails.  Conjugation of the targeting ligand and other masking groups that define DPCs was via the same CDM chemistry pioneered and still utilized by Mirus/Arrowhead.

The library was winnowed down via a series of tests, starting with membrane lysis assays down to tissue culture and rodent knockdown activity tests.  

Curiously, the paper lacked an assessment of toxicity in animals which was stated to be the entire point of the library and the study.  Whatever the motivation for this early publication of DPC research, this illustrates the early stage of Merck’s DPC development efforts.  The absence of published toxicity results may also mask a basic flaw with the disulfide concept: a) in order for these DPCs to fully degrade in the body, they would all have to be taken up into the cytoplasm; or b) the source of the toxicity is exclusively due to the intracellular accumulation of polymers.  Neither a) nor b), however, are not plausible in my humble opinion.

In any case, Merck likes to perform screening when it comes to optimizing RNAi technologies.  The most amazing example of this is probably their RNAi trigger modification screen involving over a hundred different types of nucleic acid modifications.   Regardless of what one might think of the wisdom of such brute-force and logically possibly flawed efforts, the size of these investments illustrate that Merck likely outspends all other companies in RNAi Therapeutics development, including Alnylam.

Merck Strategy

I am struggling to understand Merck’s strategy with regard to RNAi delivery.  It is obvious that all they are doing is to try and replicate the industry’s most promising technologies.  First it was SNALP (which they are still pursuing according to the OTS 2012 presentation), now it is DPC that they have set their eyes on.  I can only come up with two mutually non-exclusive strategies behind the approach. 

According to the first strategy, Merck wants confirm the validity of the promising reports.  If the technologies perform well in their hands they go out and license in the IP.  Extensive internal technology validation would be insurance against spending millions on technologies that turn out to be duds in an industry in which most technologies have not lived up to promises made.  Importantly, the decision to License technologies from the inventors and therefore presumably real experts would accelerate their pipeline development by years.  Of note, Merck still has not brought an RNAi candidate into the clinic since their $1.1B acquisition of Sirna Therapeutics and the pressure to achieve that milestone should be building.  According to the second strategy, Merck hopes to recreate or even exceed the originators’ achievements, and with luck can use the technologies without concern of infringing IP.  

Given Merck's significant investments which would seem to exceed those necessary for simple due diligence, Merck seems to be pursuing strategy No. 2.  It seems to be a risky strategy though because of IP uncertainty in general.  I therefore personally favor a more flexible implementation of strategy No. 2, namely one that envisions licenses and R&D collaborations if the IP situation or insurmountable technical hurdles eventually demand them. 

In any case, Merck must be doing quite well given the generous time and money spent on such RNAi Therapeutics research.  Enviable.

Merck in Talks with Arrowhead?

There are some comments in the paper that leads me to believe that Merck is actually talking to Arrowhead Research directly.  Although there may be hints in the very recent patent literature and investor presentations that biodegradability had been an issue with first-generation DPCs (note: Arrowhead is now using biodegradable peptides as the polymer backbone), and/or some of that has emerged when Roche opened up their books during their RNAi sales process, I have not seen such comments in the still relatively sparse peer-reviewed DPC literature.  Yet strangely, Merck presents the rationale for the disulfide strategy as if it was common knowledge.

Merck is not entirely foreign to Arrowhead Research.  Just last year, they entered into a research alliance concerning Arrowhead’s new-fangled peptide drug conjugates (PDC).  So there are open lines of communication between the companies.  Whether it’s something to get excited about if you are an Arrowhead shareholder, I’m not sure: in this industry, lots of parties are talking to each other without it ever coming to a deal.  Having said this, the recent results with DPC technology have been tantalizing, and for RNAi Therapeutics at Merck to survive, I would think that they have to put something into the clinic over the next two years or so or face the cost-cutting axe of the new chief of Merck Research Labs, Roger Perlmutter.  DPCs would seem to be one of the few options they have to meet such timelines.