GalNAc Advance by ISIS Means Oral Oligonucleotide Therapeutics around the Corner

Last week, the long-awaited first publication on ISIS’ GalNAc-targeted antisense oligonucleotides appeared in a ‘NAR Breakthrough Article’ (Prakash et al., 2014)  Living up to that label, the data with RNaseH antisense oligonucleotides (ASOs) conjugated to triantennary GalNAc sugars showed that this strategy increases potency by nearly an order of magnitude.  In combination with high-affinity chemistries (in this case cET) that facilitate the use of short (12-14nt vs ~20nt) oligonucleotides which has been shown to improve in vivo potency (Santaris research by Straarup et al., 2010), oral delivery for antisense modulation of hepatic gene expression has essentially been solved. 

Moreover, the lower dosages that can now be used in addition to the improved biodistribution profile that is now heavily slanted away from non-hepatocytic cell types in the liver and the kidney in favor of hepatocytes, means that the other major benefit of GalNAc-ASOs with immediate applicability is that the safety of therapeutic ASOs for liver-directed applications will be much improved.

The conclusion that oral antisense therapeutics are just around the corner is based on the observation that a relatively crude caprate-based phosphorothioate oligonucleotide formulation enabled a ~10% bioavailability following oral administration already (intravenous = 100%; Tillman et al., 2008).  This, in addition to some inter-subject variability that might have been linked to gastric emptying times, meant that too much oligonucleotide would have had to be administered orally with previous antisense oligonucleotides. 

Granted, this first piece of GalNAc-ASO literature did not explore oral delivery. The fact, however, that the combined use of GalNAc conjugation with high-affinity chemistry improved parenteral ASO potency by 60-fold is predicted to mean that oral GalNAc-cETs are already more potent (~6x) than subQ-administered 2^nd gen ASOs.  These have already produced impressive phase II data for targets such as Factor XI and ApoCIII.

The potency improvement in terms of oral delivery may actually be larger than 60-fold.  This is because oral delivery strategies such as caprate co-formulation which aim at increasing intercellular drug permeability are size dependent.  This means that there should be an added benefit of the smaller oligonucleotide size facilitated by cET chemistry with oral delivery.

Of course, the data leave open some questions.  My most pressing, applicable to both oral and non-oral uses of GalNAc-ASOs is how the rodent data translate into non-human primates and ultimately humans.  This is because for unconjugated phosphorothioate oligonucleotides, the potency on a mg/kg basis improves with the size of the organism.  The discussion above is based on an assumption that GalNAc-targeting will not change that.  I have been unable to make a determination yet as to whether this should hold true or not.

Other than that, the antisense weather forecast is blue skies ahead, though with a chance of thunderstorms in the form of IP skirmishes with their good friends over at Alnylam as they have pioneered GalNAc conjugation in oligonucleotide therapeutics, but may now be ironically penalized for it from a competitive point of view.  Alnylam is not the type of company that just lets competitive threats happen to them.

BiogenIdec Obtains Exclusive Rights to Most Attractive Application of ISIS Technology

It is official.  With BiogenIdec obtaining 6 years of exclusive rights to ISIS’ antisense technology (ASO) for the evaluation of potential drug targets in the CNS and the treatment of neurological disease with ASOs, ISIS has essentially given up on the homerun potential that single-stranded antisense technology could have had in this therapeutic area.  Instead, the company continues to cap its upside and distract its attention by partnering with multiple companies in various disease areas.  What is more, in the one area where it likes to retain most ownership, targeting genes expressed in the liver for cardiovascular disease, it is likely to be eclipsed by best-in-class solutions from RNAi Therapeutics.

Deal Recognizes Unparalleled Druggability of Oligonucleotide Therapeutics

Neurological disease is arguably the most attractive application of antisense technology because of the surprisingly deep tissue penetration of the CNS following local delivery and the multitude of severe diseases of very high unmet medical need such as SMA, Huntingon’s, myotonic dystrophy and ALS.  These diseases are often genetically well-defined and thus ideal targets for the entire repertoire of antisense functionalities (gene knockdown in- and outside of the nucleus, boosting and redirecting gene expression through splice modulation).  Indeed, the fact that BiogenIdec commits so much attention to Antisense Therapeutics speaks volumes to the great competitive advantage of Oligonucleotide Therapeutics: the vastly superior drug target space versus small molecules and monoclonal antibodies, including the ability to go after the root cause of diseases.

Compared to RNAi Therapeutics, I view the deep tissue penetration following local administration of phosphorothioate-based oligos as the key competitive advantage.  This is especially the case when the target cells have a broad distribution in the CNS.  For more localized target areas, virally delivered DNA-directed RNAi Therapeutics should be competitive.

  

Flawed Business Model Based On Old Times

If you follow biotechnology, you will know that keeping commercialization rights to successful drugs rather than wholesale partnering and collecting royalties here and there is the ultimate path to shareholder value creation.

ISIS’ aversion to commercializing drugs itself can be traced back to the experience of its CEO, Dr. Stan Crooke, at Big Pharma GSK.  In his mind, it is the commercialization focus and large sales forces of Big Pharma that have been killing innovation and is wasting capital. 

The flaw in this reasoning is that times have changed and the specialty/orphan drug business model, the sweet spot of Oligonucleotide Therapeutics at that, has become a huge success in the industry.  Witness the likes of Aegerion and Alexion, but also Alnylam where retaining essentially the full rights to the TTR amyloidosis franchise alone is valued by the market at close to the entire market cap of ISIS with its dozens of clinical programs.  Accordingly, the ISIS TTR program that has been licensed to GSK is an also-ran in the valuations of ISIS Pharmaceuticals.

Apparently realizing the problems with this business model, the company has been making contortions trying to accommodate what must be hefty investor criticism with business development gimmicks such as ‘preferred partnerships’ and keeping drugs longer before licensing.  The BiogenIdec relationship obviously violates the latter principle.

With most other companies, I would not be as harsh when it comes to a $100M plus X biodollars deal. But for a $3.5B market cap company and the reasons stated above, it is difficult to find even a financial rationale for capping the value in the most attractive disease area for its technology.