Investor Appetite for Expanding the Nucleic Acid Therapeutics Tool Box

The last few days saw two more eye-catching examples of investors daring to dream big by committing significant early-stage capital to building new Nucleic Acid Therapeutics platforms. 

First, start-up mRNA Therapeutics company Moderna Therapeutics took advantage of the hype it was able to create in the wake of a deal earlier this year with AstraZeneca which involved $240M in upfront monies alone to raise another chunky $110M in a private round.  This brings the total raised by Moderna to over $400M in the last 2 years or so.  Then on Monday of Thanksgiving week, a consortium of VCscommitted up to $43M to start up Editas Medicine, a company built around genome editing harnessing the recently identified CRISPR adaptive immune system in bacteria.

Counting in IPOs and private rounds by nucleic acid therapeutics companies (e.g. Bluebird Bio in gene therapy, Prosensa in exon skipping), well over half a billion raised by RNAi Therapeutics companies in 2013, partnership monies earned by ISIS etc, we are talking here probably about approx. $1.5B raised by the industry so far this year.  And what is best about this in my opinion is that these fund raisings were not intended to help with commercializing a newly approved product or running a large phase III trial for a late-stage clinical candidate- no, they were mainly the result of broader interests in the platforms.

What a departure from the post-2008 world of biotech and oligonucleotide therapeutics when pipelines were commonly regarded as a financial liability and the platform concept was the ultimate biotech heresy belonging to the 2000 genomics bubble era.

If you like to see the glass half empty and secretly hope that the world is coming to an end soon (e.g. in the form of a stock market collapse), good luck to you!   While I expect some volatility as the industry moves towards bringing meaningful drugs onto the market and cash flow positivity (just witness the recent Prosensa and Sarepta stumbles) , looking at the nucleic acid therapeutics pipelines and a healthcare environment friendly towards targeted therapies that are the sweet spot of nucleic acid therapeutics, it is hard to come up with scenarios in which this nucleic acid therapeutics revolution can still be halted.  Moreover, the strong cash balances of some companies mean a virtuous cycle of value creation for companies like Arrowhead Research which are capital constraint, not technology constraint, and should also allow them and their investors to weather short-term volatility.

Having said that, the time for some healthy pruning will ultimately come, likely in the wake of the next major upheaval in the normal economic cycle, and I expect some investors to throw in the towel even before some of these technologies have had the time to prove themselves.  You think that making delivery work for RNAi Therapeutics strained some investor patience, then what about getting a protein, RNA, and DNA into the nuclei of target cells all at the right amount and time for the correction of single-gene disorders as appears to be the first therapeutic frontier of Editas?

   

But until then, the fact that investors dare to dream of medical breakthroughs again means that the future of biotechnology which lives off such bold concepts remains bright.   Nucleic acid therapeutics will play a critical part in that future.

Marina Biotech as a bet on the oligonucleotide therapeutics tool box

As the economy improves and interest rates remain low, I expect money continue to move into the higher risk end of the market.  In terms of the stock market this generally means that while the 'safe' companies were the first to recover following the collapse of the housing bubble, the more innovative and 'risky' groups such as social media and biotech followed with even larger returns.

Thinking of the oligonucleotide therapeutics space, the ultimate high-risk play that has yet to respond to the improved market conditions is Marina Bio.  In hindsight, the two main reasons for Marina Bio's spectacular share price erosion were (1) that it promulgated the idea of an oligonucleotide therapeutics supermarket concept when nobody wanted to hear of it, and (2) that it did so after it had lost its credibility in the markets after many broken promises (largely under previous leadership) and then tried to re-define itself by the year.

Most would consider it dead now, but with a number of licenses to companies like Novartis, Monsanto, and Tekmira, two products in the clinic that utilize its SMARTICLE delivery technology (one for a microRNA Rx mimic by Mirna Therapeutics, one for an DNAi Therapeutic by ProNAi) and an in-house clinical candidate for an orphan indication (transkingdom RNAi for FAP cancer) in a suspended (for financial reasons) phase I study that one ought to be able to revive, it should have more inherent value than the $3-4M current market cap suggests.   In addition, it retains access to usiRNAi triggers and high-affinity antisense chemistry for RNaseH gene knockdown and steric blocking applications that I see on par with the technologies by ISIS Pharmaceuticals, Santaris, and Regulus.

As appetite for all things oligonucleotide therapeutics grows, this could be an interesting play.

Silence Therapeutics to Validate Endothelial RNAi Knockdown in Man

This Monday, Silence Therapeutics held an investor evening in London.  To my surprise, interest in the company and technology was such that 80-100 largely analysts, investors, and fund managers crowded the elegant Victorian-style room at the Royal Institution.  In stark contrast to the quaint setting, the main message of the evening was that the company won’t play it conservatively when it comes to this cutting-edge medical technology and is about to test whether their lipoplex-based delivery technologies can knock down genes expressed in endothelial cells…in Man.

Whereas RNAi Therapeutics have more or less conquered the liver, opening up a whole host of indications to RNAi Therapeutics, despite the apparent accessibility of the vascular endothelial system to delivery and promising animal studies, it has proven a more difficult tissue to firmly establish gene-specific knockdowns.  Part of this technical problem is due to the fact that the vasculature, especially the capillaries which are of most functional importance, is tightly interwoven into the tissues that they supply.   This causes experimental difficulties of obtaining pure endothelial cell populations, a particular concern when genes are also expressed in the more abundant host tissue cells.  Moreover, unlike the liver, proteins (and RNA) expressed in the vasculature are not commonly found in the serum.  The latter is of particular importance in clinical studies where taking appropriate biopsies is either not technically feasible or would be deemed unethical.

Similar to how the clinical demonstration of target gene knockdown in the liver has turned around the fortunes of the likes of Alnylam and Tekmira, Silence Therapeutics also wishes to remove remaining doubts by conducting a second phase Ib/IIa study with lead candidate Atu027, this time not in pancreatic cancer (impossible to obtain adequate biopsies in advanced pancreatic cancer patients), but for head and neck cancer (anticipated regulatory submission in 2014).  Head and neck cancer is one of the few cancers for which the tissue is readily accessible.  And while they are at it, they also will take muscle biopsies to look for PKN3 target repression, and look at a whole slew of other assays, some serum-based, for their ability to assess gene expression in vascular endothelial cells.

In addition to the clinical efforts, I also expect the company to more strongly adopt non-human primates for their delivery studies.  When it comes to liver-directed RNAi, non-human primates have been accepted to be a highly predictive surrogate for performance in humans and one can expect the same to be true for endothelial gene knockdown.

The strategic changes are accompanied by continued corporatere-organization of which the most notable overall change may be the increased clinical focus.  This effort is spear-headed by Dr. Michael Khan who is trained in internal medicine and thus has a good feel for selecting interesting indications of unmet medical need and conducting the appropriate clinical studies.  On the scientific front, the most notable change is the departure of long-time CSO Dr. Klaus Giese (due to family reasons), succeeded by long-time comrade Dr Joerg Kaufmann.

In addition to picking up details like the ones above, such investor events are also an invaluable opportunity to gather insights into the investor base and other people associated with the company.  In that regard, the new CEO Ali Mortazavi has done an remarkable job not only at expanding the technical, clinical, and business development expertise of the company, but also at putting the company in a position to become a sustainable stand-alone biotech company which, if you have followed the fate of UK biotech, is not an easy task.  With Atu027 clinical efforts in high gear and Atu111 for acute lung injury likely to join the clinical pipeline in 2014, the coming period will not only test the organizational skills of management, but also their ability to react to share-price moving clinical events.  Expecting success, Silence Therapeutics is striving for a full listing on the LSE thereby opening up the company to an even larger investor base.        

To learn more about Silence Therapeutics and related events, please follow this link.

Arrowhead Research Patent Application Shows Ample Experience with Triantennary GalNAc-siRNAs

[Warning: this blog entry is not about to discuss a very recent development, but rather is intended to compare the liver gene knockdown technologies by Arrowhead Research and Alnylam based on a review of the patent literature; for the non-technical folks, a mention of Novartis towards the end might be of interest]. 

It has become clear that the DPC technology by Arrowhead Research, especially their 2-molecule-version used in ARC520 for chronic HepB, and Alnylam’s GalNAc-siRNAs share a number of features.  Based on patent application by Arrowhead Research that published last summer, there is evidence that the company has ample first-hand experience with the platform used by Alnylam.  Importantly, the data show that the addition of an endosomal release agent greatly increases the potency of GalNAc-siRNAs.

Large increase in potency with endosomal release polymers

Previously, I had speculated that simple GalNAc-siRNA conjugates as advertised by Alnylam have insufficient potency.  Accordingly, patent application US2012/0136042A1 by Alnylam showed that whereas simple GalNAc-siRNA conjugates had no or very little knockdown activity, the addition of a lipidic pharmacokinetic modulator with some endosomal release activity such as cholesterol allowed for more robust activity (see first image below).

Demonstrating the superiority of DPC delivery technology for gene knockdown in the liver, at least in terms of potency, the patent application by Arrowhead Research shows that even so, the activity of a GalNac-lipid-siRNA pales in comparison to its use along an endosomal release polymer: no knockdown with GalNAc-palmitoyl-siRNA alone, but an 80% knockdown when given together with the polymer (see table).

Note that a range of lipids, including cholesterol were evaluated in that patent application.  Also note that the preferred GalNAc-conjugation was the same triantennary GalNAc structure as used in Alnylam’s programs.  

Intellectual property consideration

While the Alnylam patent application claims priority to sometime in 2007, the Arrowhead patent application claims priority to sometime in 2010.  Given that the data suggest that Arrowhead should have chosen the triantennary GalNAc-cholesterol-siRNA backbone for ARC520 for maximum potency with the 2-molecule DPC approach, instead of the cholesterol-siRNA that they eventually chose, it is possible that IP concerns played a role in that decision. 

Another, non-exclusive explanation might have been manufacturing cost concerns which should favor simple cholesterol conjugates over triantennary GalNAcs.  This would also be justified in that it is the toxicity from the endosomal release peptide and not the RNAi trigger that is expected to be rate-limiting in terms of toxicity.  In other words, to compensate for the inferior potency of cholesterol-siRNA along the release polymer, you just give more of it.

In any case, given the overlapping research activities of the two companies as evidenced by the patent applications, possibly partly the result of the former Alnylam-Roche partnership, it will be interesting to follow the patent prosecutions to find out to which extent the patents by Arrowhead Research could impair the freedom-to-operate and novelty of Alnylam’s platform, both with regard to GalNAc3-siRNAs and GalNAc3-lipid-siRNAs.

An interesting player in this convoluted situation is Novartis.  Assuming Novartis has access to GalNAc-siRNAs from Alnylam, they might be able to combine them with the endosomal release polymers from Arrowhead Research for optimal DPC2.0 knockdown activity (of course, that assumes they take some sort of license from Arrowhead Research).  It’s time for Novartis to show their RNAi delivery hand anyway lest they suffer the same fate as their peers' with their RNAi investments losing all of their value.

Single-molecule subQ DPC

The potentially convoluted IP situation is another, albeit secondary reason, why I greatly look forward forward to Arrowhead Research adopting for their upcoming development candidates the new old single-molecule DPC technology for which they had shown very impressive non-human primate data at last year’s OTS meeting. 

Because the GalNAc residues in the single-molecule DPCs are distributed along the peptide, there is no need for a triantennary GalNAc cluster for similar hepatocyte targeting potency.  Moreover, PK modulation can be achieved by modifying the polymer without the need for direct modification of the RNAi trigger.

And with regard to ARC520- don’t get me wrong. The intravenously administered ARC520 is still an exciting candidate with good activity, it’s just not as potent as it could have been.  I therefore look forward to seeing a second-generation candidate enter clinical development once clinical proof-of-concept for the immune reactivation hypothesis has been formally obtained.  Such a candidate would have much increased potency (at least 10x) and could be administered subcutaneously.  A high-quality problem to have.

Alnylam Solidifies Lead in TTR Amyloidosis Race

Over the weekend, Alnylam announced expanded data from the phase II study of ALN-TTR02 (aka PATISIRAN) in the FAP form of TTR amyloidosis at the ISFAP meeting being held in Brazil.  The data confirm the consistent knockdown potency of ALN-TTR02 and, most interestingly, suggest that a new dosing regimen can address the most rate-limiting safety issue encountered so far. 

Compared to the 19-patient dataset revealed at the Peripheral Nerve Society meeting at the end of June, the latest update includes data from 9 more FAP patients that received the highest dose (0.3mg/kg) in the once-every-3-week treatment regimen.  Previously only 3 patients received such dosing whereas the data from the 6 patients with the once-every-4-week dosing indicated an undesirable TTR rebound effect towards the end of the 28-day treatment cycle.

Data from the 12-patient once-every-3-week cohort now show that a ~80% persistent knockdown of TTR can be achieved although there still seemed to be a minor rebound effect at the end of the 21-day treatment cycle (down to ~75% knockdown).  It therefore needs to be watched whether the apparent rebound effect worsens or maybe gets better with dosing for more than the two infusions as performed in this study (open-label extension study ongoing).   

The most exciting revelation, however, from the new data was that there were no apparent infusion reactions in the 9 additional subjects.   Previously, 3 out of 7 in the once-every-4-week cohort of 0.3mg/kg experienced such reactions.  Infusion reactions thus far tends to rank as the rate-limiting safety issue in the development of SNALP-related RNAi Therapeutics and although they appear to be readily managed by slowing the rate of infusion, are dose-related, and generally occur only during the first infusion, it would put everybody at ease if there were no such risk.

Rather than being the result of a streak of luck, the absence of infusion reactions coincided with the institution of a 70-minute microdosing strategy which Alnylam labeled as ‘proprietary’.  If it holds up, it would definitely be good news for Alnylam and FAP patients.  Beyond that, Tekmira may actually be the major beneficiary of such progress as its pipeline rests on i.v.-administered SNALP RNAi Therapeutics such as ALN-TTR02.


By initiating a phase III study of Patirisan and further announcing fast-track designation for this product candidate, the company remains on track for an approval in 2016/7.  Data from the competing RNaseH antisense compound by ISIS and GSK at the same meeting remains to be publicized.

ARC520 for Chronic HepB: The Immune System…It’s Reactivating!

Usually, immune stimulation which manifest itself as flu-like symptoms and the like is something that you do not want to see with an RNAi Therapeutic.  Having said that, there are settings in which you want to see immune stimulations.  This is also the case for the treatment of chronic HBV with a HBsAg knockdown approach. 

ARC520 is the lead candidate in this effort and yesterday the sponsor, Arrowhead Research, presented very exciting data in a chronically infected chimpanzee that had been treated with the RNAi agent.  The data are not only exciting because they presumably represent the fastest reduction of the HBsAg antigen ever seen in a real infection (note: only the chimpanzee is thought to reflect human HBV infection), no, what is even more exciting is that the data are consistent with a HBsAg-specific T-cell immune response.  

As the success of an HBsAg knockdown approach for the treatment of chronic HBV hinges on the hypothesis that by knocking down HBsAg it might be possible for the body to re-activate an adaptive immune response against the virus, the data in my mind are the biggest de-risking event in the development of ARC520.

The data

At the 2013 Liver Meeting of the AASLD in Washington DC, Arrowhead Research presented more detailed data on the chimpanzee that had been treated with ARC520.  Before that we had known that two doses of ARC520 (one of 2.0mg/kg and one of 3.0mg/kg) spaced 14 days apart was able to knock down HBsAg by ~80%, HBeAg by over 90%, and serum HBV DNA by 1-2logs.  The important knockdown here is that of HBsAg, an otherwise ‘undruggable’ target.  Reverse transcriptase inhibitors such as entecavir are not able to meaningfully reduce HBsAg.

The discrepancy of the degrees of HBsAg and HBeAg/HBV DNA knockdowns is likely explained by the prolonged half-life of HBsAg.  Repeat dosing for an extended period of time should lead to even further reductions in HBsAg.  Moreover, the treated chimpanzee was an unusually tough challenge, because old (HBV for over 35 years alone), heavy and with extremely high viremia (>10exp10 genomes per ml). 

Importantly, as predicted by the HBsAg knockdown-immune reactivation hypothesis, there was an apparent T cell-mediated anti-HBsAg immune response shortly after peak HBsAg knockdown levels were reached.  The peak HBsAG knockdown occurred somewhere between ~days 25 and 38 and there was a flare-up in liver enzymes around day 43.   

 

A liver-enzyme flare-up would be expected when anti-HBsAg cytotoxic T-cells start to attack HBV-infected hepatocytes.  Consistent with it being due to a T-cell response, markers of T cell activation, most notably interferon gamma, were also up-regulated around the time of the flare-up.  Interestingly, liver enzyme levels did not fully revert back to normal, but remained somewhat elevated compared to base-line suggesting that the RNAi knockdown kicked into gear a more persistent immune response.

Such delayed dynamics are consistent with what is seen following successful treatment with interferons.  In the ~5-10% of cases where interferons are able to achieve the gold standard HBsAg elimination (in the presence or absence of HBsAg seroconversion), the elimination usually occurs after the ~52 week course of interferon, in many cases years afterwards.

Of course, the present chimpanzee data do not show an elimination of HBsAg.  While I do not exclude the possibility that Arrowhead Research will come back in another 3 months or so to report that the immune system has finally overcome HBsAg, I prefer to keep expectations for such an event low and instead consider the present data as a nice starting point that indeed ARC520 is able rekindle the desired immune response after only two doses over 14 days.

Why it is unlikely to be a non-specific immune response

It is very important here to emphasize that what we are seeing here was not due to a non-specific innate immune response triggered by an immunostimulatory RNAi agent.  Similarly, some RNAi delivery strategies run the risk of causing direct damage to hepatocytes which would also manifest itself by increases in liver enzymes.

The most convincing argument to me is in the timing of the flare-up and cytokine elevations.  While non-specific responses usually occur in the hours and days immediately following RNAi administration, in this case, they occurred 3-5 weeks after the second dose.

Consistent with a ‘clean’ safety profile of ARC520, no such liver enzyme and cytokine elevations were seen in the phase I volunteer study for which Arrowhead reported initial safety data a month ago (2mg/kg highest dose in that study).  Nevertheless, as those data only focused on the safety in the first few days following drug administration for the above reasons and the 30-day follow-up still remains to be reported, one formally cannot exclude the possibility that the unique DPC chemistry is associated with liver damage and the like only weeks after drug administration.  I consider this quite unlikely though.

Going along with this theme, I expect the phase IIa study which will involve infected patients in Hong Kong and is scheduled to initiate enrollment in early 2014 to be ARC520 on top of an RT inhibitor such as entecavir.  As RT inhibitors stabilize the liver of HepB patients and in light of the phase I data, any flare-ups that would be seen in that single-dose study would presumably be the result of HBsAg-specific immune reactivation.  

Lots of exciting catalysts ahead over the next 6 months and who knows, due to intrapatient variability, maybe there will be a cure or two in the phase IIa study already.  

PS: For more background on RNAi knockdown for HBV and ARC520, please visit my cureHBV companion blog.