Time is running out for Benitec

Benitec announced today that almost 1 ½ years after filing an IND for its DNA-directed RNAi HCV candidate, it has now obtained liver biopsy data from first 3 of the 4 patients dosed so far.  Needless to say, the analysis was a resounding success confirming that the right AAV vector coding for the shRNAs against HCV was administered to the trial subjects.

Given that no details were provided on the methods, I assume that the evidence is based on PCR analysis which pretty much picks up almost any activity.

TT-034 also shined on safety with ‘no treatment-related serious adverse effects (SAEs) in any of the four patients dosed’.

To wit, the motivation behind the gene therapy ddRNAi HCV trial is to provide a one-shot cure from HCV infection.  The company, however, said that ‘the amount of shRNA produced will not result in reduction of hepatitis C viral load’.  

So while this statement almost makes it sound like they did not look for antiviral efficacy, but that there might well have been, we can safely assume that they did (standard blood test to look for HCV; plus RNA analysis from biopsies) and failed to see such.  

It is also curious that no results from PCR-based target mRNA cleavage assays were disclosed which, while still PCR, requires a certain amount of RNAi robustness to detect with confidence and would have been used to further tout trial success. 

At this point, Benitec has almost completed the first 2 of 5 planned dose cohorts.  According to my notes, the top dose is about 25x higher than dose group 2.  To get from no change in viral titer to undetectable while increasing dose by 25x seems quite optimistic to me.  And even if this highly unlikely scenario materialized, at this pace, it will be sometime in 2023-4 when it would even be considered for approval.

So please, Benitec, if you cannot see a knockdown at the next higher dose cohort, give it a rest.   

Voyager Therapeutics Sets Out to Fulfill Promise of AAV-directed RNAi Therapeutics (and More)

Finally!  Long overdue (because so obvious and compelling), with the founding of Voyager Therapeutics, the foundations have now been laid for a strong AAV (adeno-associated virus) platform gene therapy company, including DNA-directed RNAi Therapeutics.   Taking advantage of new AAV shuffling approaches to identify novel serotypes (Gao and Kay labs) to more efficiently and specifically target cell types of interest and the world-class expertise in RNAi trigger design of  two of its scientific co-founders (Kay and Zamore labs), the new company will make use of the best available science to realize the potential of AAV and ddRNAi technology for the many diseases of high unmet medical need in the CNS (e.g. Huntington's disease).

With $45M in start-up funding from Third Rock Ventures (the VC that has started the comparable lentiviral-based gene therapy company which recently went public, bluebird bio), they will deepen that expertise through in-house research and thereby sail by Benitec which sadly has refused to face the fact that in order to be a platform company and stay relevant you need to have such efforts.  If not at a time like this when interest is high, then when??  The latest publication by Benitec and Pfizer (Denise et al. 2014) was ironically the best illustration of that omission by showing that the first-generation ddRNAi expression technology of Benitec generates a plethora of small RNAs which obviously is less than ideal.  By contrast, work in the Kay lab in particular (e.g. Gu et al. 2012) has shown how to generate much cleaner expression cassettes.

Voyager strutting its RNAi expertise and related therapeutic development plans is further confirmation of the dramatic decrease in the value of Benitec's once-prominent IP position in ddRNAi (Graham patent).  With an expiration of ~2018-2020 and Baulcombe the real gate-keeper (although the clock on that one is also rapidly running down), I don’t see why there should be a need to take a license except for maybe the likes of Calimmune which may have something close to commercialization by then should things proceed without a hitch.

The start of a company like Voyager is always very exciting and I trust that the scientific founders have the expertise and wisdom to guide it along the way.  It is also a good time to acknowledge the likes of Dirk Grimm (Heidelberg), Shuo Gu (NCI), and most recently Leszek Lisowski (Salk) which I had the privilege of working next to in the Kay lab when they were critically contributing to the technology underlying Voyager.  The pharmaceutical industry and indeed the investor community is wasting a lot of potential by not tapping into the skills of such driven scientists just because they may not labor in one of the biotech hotbeds.

Demystifying ddRNAi Trigger Design

A somewhat vexing problem with DNA-directed RNAi (ddRNAi) has been the heterogeneous mixture of small RNAs generated from a typical expression vector.  Not only will this compromise knockdown efficacy through competition for RISC loading, it also poses a safety risk by increasing the number of off-target genes.  For a long time, heterogeneous ddRNAi trigger processing had been accepted as a way of life- as long as the efficacy was right you would not waste too many thoughts on those multiple bands on your Northern blot.  

Choosing the double-strand length of a ddRNAi trigger has also been more art than science.  Different sizes, usually between 19 and 29bp facilitate potent gene knockdown, but there have been few studies looking at the consequence of size on the uniformity of hairpin processing.   

Next-generation sequencing technology is changing these attitudes.  In a paper that appeared last week in CELL, Gu et al. from the Kay lab in Stanford showed that next-gen sequencing is a powerful tool to detect which small RNA species are generated from a given ddRNAi template plus their relative quantities.  Moreover, through an iterative process of structural change and sequencing, a key structural feature causing the Dicer enzyme make just one predictable cut could be identified.  Without going into much detail, a simple 21 base-pair hairpin yields the purest results.

Commercial ddRNAi trigger landscape getting rusty  

While the clinical validation of SNALP delivery technology has allowed synthetic RNAi trigger-based Tekmira and Alnylam to turn around their fortunes and should also increase general interest in the technology, there seem to be no commercial players left in the ddRNAi Therapeutics arena able to champion and refine the platform. 

Benitec is pre-occupied with trying to monetize IP that is rapidly losing in value due to its age and as a result failing to become a real biotechnology company with a lab.  The two viral delivery companies that once had some ddRNAi ambitions, AMT (AAV) and Oxford Biomedica (lentivirus), either went out of business and/or lack the requisite RNAi molecular biology expertise.  And the other groups developing ddRNAi Therapeutics, including Calimmune and Genables are de facto one-product, disease-focused companies.  This is unfortunate as there should be room for at least one or two ddRNAi Therapeutics platform companies.

Such a company would have expanded on the basic dsRNA concept and would thus have kept its IP estate fresh, eventually forcing others to take a license as simply running out the patent clock would not have been an option.  Such IP would include discoveries like the one made by Gu and colleagues.  On a more positive note, it is possible that the current revival of gene therapy after a decade of neglect and scorn will eventually carry ddRNAi Therapeutics along with it.

RNAi Therapeutics Investors Are Getting More Selective

The recent share price performances of RNAi Therapeutics companies have confirmed that clinical data have become the critical new bar for investors. Even discounting the fact that biotech in general has performed well this year, it is clear that the SNALP-enabled clinical phase I results for ALN-TTR01 (transthyretin amyloidosis) and ALN-PCS02 (hypercholesterolemia) have had the desired impact on the share prices of Tekmira and Alnylam: +57.5% and +73.5% increases since the ALN-TTR01 results were announced in November ’11, respectively. Moreover, the recent $80M+ financing by Alnylam, and to a smaller degree the $4M private placement by Tekmira, underline that new money is flowing into these companies.

Other companies have had a harder time. In fact, with the market capitalizations of Marina Biotech and microRNA Dx company Rosetta Genomics reaching a point where the companies become increasingly unsustainable, and Galena (formerly known as RXi Pharmaceuticals) ridding itself of its RNAi Therapeutics heritage, the shake-out in the field of the publicly traded RNAi Therapeutics-related companies has only intensified. Consequently, aside from Tekmira and Alnylam, the most significant remaining public RNAi Therapeutics companies are Silence Therapeutics, Arrowhead Research, and Benitec. To what degree they can be joined by the likes of Quark, re-surrected RXi Pharmaceuticals, or Calimmune remains to be seen as not too long ago, RNAi IPOs were all but unthinkable.

Here a quick run-down of the companies:

Tekmira: SNALP systemic delivery technology has emerged as the major value driver in the industry. Overly focused on technical progress rather than brand building, Tekmira is still fighting with a market perception that because it’s market cap is so small (<$40M), Alnylam must rightfully have full ownership of Tekmira’s technology. Especially the analyst community has largely been ignoring their position, but it looks like the courts are starting to see through Alnylam’s strategy (e.g. here). The recent financing will give Tekmira some breathing room albeit at the cost of further dilution. Besides the litigation, additional clinical results from the TKM-PLK1, TKM-EBOLA, ALN-TTR, and ALN-PCS02 programs expected this year will be critical to Tekmira shareholders.

Alnylam: Good clinical execution with its new crop of SNALP-enabled therapeutic candidates. One year after announcing 5x15^TM, the company has become much more narrowly focused on introducing only a select few products in the market itself. This, and the recent financing, could be interpreted as preparing for a potentially adverse outcome to the Tekmira litigation, but it is also a structure that will allow the company to sell itself more easily. This is in stark contrast to the strategy of antisense partner/competitor ISIS Pharmaceuticals which has stretched itself out onto so many different therapeutic areas and partnerships that it is difficult to see that company being acquired any time soon.

The successful offering has confirmed once again that Alnylam is well connected in the biotech financial machinery. After receiving upgrades and (re-)newed analyst attention from the likes of Leerink Swann (!- because of the infamous 2008 report on the company), MLV, and Rodman and Renshaw, the company reciprocated by letting them all participate in the offering. As a shareholder of Tekmira, this to me is frustrating as these analysts would never say a critical word about Alnylam’s position with regard to the Tekmira litigation. And, of course, the legal process is not exactly fair when a cash-rich company apparently does its best to delay the litigation so that it can financially outlast its ‘small’ opponent.

Continued positive clinical results will be important to extend the positive trend in ALNY, but all bets are off as we approach the late October 2012 trial date with Tekmira.

Arrowhead Research: The company arguably made a good deal with the acquisition of the Roche RNAi Therapeutics assets for a few pennies on the dollar originally paid by Roche. Critical to the success of that company will be how quickly DPC delivery technology is ready for clinical development. The absence of peer-reviewed non-human primate data and knowledge of how advanced DPC manufacturing is increases the risk that the DPC-enabled HBV program may take longer to enter clinical development than hoped for.

Silence Therapeutics: Following promising phase I data with Atu027 for solid cancer and positive developments on the IP front, recent developments were not so positive. Most discouragingly, Thomas Christely unexpectedly resigned after only a short stint as the CEO. In the absence of any cogent explanation besides the usual ‘personal reasons’, one may come to the conclusion that after the 6-month data delay with Atu027 and the apparent failure to extend the critical AstraZeneca and Dainippon Sumitomo collaborations, another painful round of dilution may be inevitable.

Benitec: The fortunes of that company are looking up as Gradalis and Calimmune are progressing their ddRNAi Therapeutics products. Just this morning, Benitec announced that Calimmune has taken a non-exclusive license to Benitec’s ddRNAi IP for HIV/AIDS. It is critical to Benitec’s strategy to make sure that the early ddRNAi candidates that are in or close to the clinic are licensed under their IP. As its fundamental Graham IP matures, however, it will have to wean itself off its focus on IP and instead execute on product development. Particularly the pain program looks promising here.

Marina Biotech and Rosetta Genomics: With their tiny market caps of $2.5-5.0M, it becomes increasingly difficult to further justify their coverage. It’s a pity because some of their technologies have some value. The erratic strategies of these companies, however, seem to have destroyed all investor confidence.

ISIS Pharmaceuticals: The topline data evidence is quite strong that ISIS RNaseH antisense can knock down genes in the liver, kidney, some cancer, and possibly other tissues in the clinic. Safety and tolerability issues and other delays, however, seem to still come up with regularity when it counts and only by presenting the full dataset can it be determined whether continuously high phosphorothioate concentrations, particularly following systemic administration, are sufficiently well tolerated for broad clinical use. In terms of technical progress therefore, the corresponding liver and kidney concentrations at which a knockdown is achieved is a key parameter to watch going forward.

If mipomersen does not get approved for anything beyond hoFH and/or does not sell well, the company’s strategy of giving away value early in development could start to hurt as it will be some time until another in-house development candidate can reach regulatory approval.

Gradalis Swiftly Moves ddRNAi-Enhanced Cancer Vaccine Candidate through Clinic

I’ve been reminded a number of times by the staunch Benitec-supporters here that Texas-based biotech company Gradalis has been moving a ddRNAi-enhanced cancer vaccine candidate (‘FANG’) aggressively through clinical development. Virtually out of nowhere, Gradalis initiated clinical trials two years ago and there are now two active phase II trials, one in ovarian cancer and one for advanced melanoma. A peer-reviewed publication on the phase I trial was also just published (Senzer et al.) arguably making FANG the lead RNAi candidate in oncology.

The phase I study involved over 40 patients with advanced solid tumors and demonstrated the safety and logistic feasibility of the approach. Although evidence of suggestive of efficacy was presented such as a clear correlation between an immune response and survival, it would be premature to conclude anything with regard to efficacy. Having now followed a number of cancer vaccines, most of which have eventually failed, it seems to me that correlations such as this could be just as well as a reflection of the fact that those with more responsive immune systems will do better anyway.

‘FANG’ comprises of plasmid DNA from which a single RNA polymerase II promoter drives the expression of an upstream GM-CSF open-reading-frame followed by a pair of downstream RNAi hairpins. This plasmid is introduced by electroporation in a petri dish into the patients’ own cancer cells which have been obtained from a tumor resection. After allowing some time for the expression of the transgenes, the cells are irradiated so as to kill off their proliferative potential and are then re-introduced like many other vaccines by intradermal injection.

The GM-CSF component, wildly popular in the cancer vaccine field and also part of Dendreon’s famous prostate cancer vaccine PROVENGE, is supposed to serve as an attractant, proliferation and maturation factor for dendritic cells which are supposed to ingest, present and thereby stimulate an immune response against the antigens unique to a tumor; the pair of ‘bifunctional’ hairpins meanwhile both target furin which is thought to be an important protease for the maturation of the various isoforms of TGF-beta, a well-known immunosuppressant often overexpressed in cancer.

‘Bifunctional’ here means that one hairpin is perfectly matched and therefore mostly relies on the so-called Ago2/cleavage-dependent mode of RISC activation, whereas the other hairpin contains a central bulge due to mismatching changes introduced in the passenger strand arm of the hairpin thus relying on the non-cleavage pathway of RISC activation which can be facilitated by all four human Argonautes (both predicted to yield the identical guide strand). This strategy of distributing the RNAi between the various Argonaute proteins is certainly an interesting idea, but I’m not sure whether even Gradalis knows what consequences of this is both in terms of efficacy and safety.

A general lack of detailed molecular mechanistic studies is probably my biggest concern with this candidate and when thinking about Gradalis in general. It also at least partly explains why FANG has been moving so rapidly through the clinic. I find it particularly troubling that I have seen no detailed studies by Gradalis looking at the relationship between furin knockdown and TGFbeta inhibition which is key for Gradalis' strategy. This already has caused difficulties in interpreting some of the phase I data where possible assay problems complicated reconciling apparently only modest reductions in furin with much more pronounced down-regulations of TGFbeta. This not only makes it more difficult to make the right development decisions, but also when it comes to finding a partner for the program. On the other hand, you could argue that a cancer vaccine candidate involving both GM-CSF expression and TGFbeta inhibition already has a good chance at succeeding, and sweating out the technical details would only cause delays without making us much the wiser.

As I had mentioned, the Benitec supporters are following Gradalis’ development with much interest as such an advanced ddRNAi candidate may be a prime licensing opportunity for Benitec which controls an important part of the ddRNAi patent landscape. I’ve certainly looked at the hairpin structures involved in light of Benitec’s patent claims (esp. the ‘099 Graham patents) and there is a good chance that Gradalis ought to take a license as it further monetizes this candidate, although their structures may give them a bit of wiggle room.

Mirna Therapeutics selects Marina Biotech’s SMARTICLE delivery tech

In another notable development last week, cancer microRNA Therapeutics company Mirna Therapeutics said that it would use Marina Bio’s SMARTICLE liposomal delivery technology for the development of microRNA replacement therapy for cancer. Based on conference presentations, the two companies had been collaborating on the delivery of microRNA mimics before announcing the deal. An attraction of the SMARTICLE delivery technology, which Marina had acquired from Novosom, is certainly the fact that there is already clinical experience after SMARTICLE-enabled ‘DNAi’ compound by ProNAi has begun dosing a year ago. Similar to related agreements between Mirna and Silence, and InteRNA and Silence, insightful details about the financials were not disclosed. For Marina, which have diluted shareholders by what seems like a 100-fold over the last 3 years (unreal, really), it is good news as its extensive technology offering is finally getting takers.

Data from Nucleonics HepB DNA-directed RNAi Therapeutics Study Published

Following major IP battles with Benitec and tensions high within the company, DNA-directed RNAi Therapeutics company Nucleonics became the first major RNAi Therapeutics company to go out of business in 2008. During the liquidation process, Alnylam surprised observers by scooping up Nucleonics’ IP assets. Adding to the confusion, Nucleonics had just initiated dosing in a phase I study of NucB1000, a candidate for the treatment of Hepatitis B Viral infection. The fate of this trial has been a mystery.

Now, after three years, scientists and clinicians involved in the study broke their silence and reported data from the study in the journal Antiviral Therapy (Gish et al., 2011). The results from the prematurely terminated study that had enrolled only three patients in the first dose cohort were largely in line with (at least my) expectations. More surprising, however, were some disclosures related to Alnylam’s apparent interest in NucB1000 and DNA-directed RNAi Therapeutics.

NucB1000 Background

The active ingredient of NucB1000 is a plasmid DNA that encodes for 4 shRNAi triggers targeting various regions of hepatitis B virus. The ability to easily accommodate a number of RNAi trigger sequences in one clinical candidate is one of the advantages of ddRNAi Therapeutics and particularly useful for antiviral applications as it should minimize viral escape. Using ddRNAi as opposed to a synthetic siRNA for HepB infection is also reasonable given the chronic nature of the disease.

This, however, is about it in terms of the positive attributes of NucB1000. The reason why I never thought this candidate had even a remote chance of clinical success is the fact that it uses a cationic lipid formulation to deliver the DNA to affected hepatocytes. Unlike the efficient liposomal delivery of small, synthetic siRNAs to the cytoplasm of hepatocytes, the field of gene therapy is still far away from using non-viral means to efficiently deliver large plasmid DNA- about 100-200x the molecular weight of siRNAs- to the nuclei of hepatocytes where the DNA can serve as the template for shRNAi trigger transcription. It is not just the size that complicates the cellular uptake and release of the nucleic acid, but the requirement for getting the DNA from the cytoplasm to the nucleus is the major rate-limiting step differentiating it from synthetic siRNA delivery.

The authors addressed this deficiency by stating that even if uptake efficiency was limited per given plasmid infusion, the long-lived expression from the plasmids means that it may be possible to achieve ddRNAi activity in sufficient numbers of hepatocytes simultaneously by multiple administrations. While I can follow the logic, in the absence of convincing pre-clinical data of this concept, it remains just that, a concept.

Of equal concern is that cationic lipid-formulated large plasmid DNA carries a high risk of triggering innate immune stimulations following intravenous administration. This has already been a challenge for lipid-formulated small siRNAi triggers, but it is less of a fundamental challenge there because of the limited sequence information in a given siRNA. This means that any inherent innate immune stimulatory potential can be relatively easily controlled by chemistry. The much larger plasmid DNA, which typically is of bacterial origin, does not allow for such control.

I should mention that in light of these concerns the authors state that no apparent immune stimulations were observed in the mouse and dog studies at much higher dosages than were anticipated for the trial.

Nevertheless, it is surprising to me that the FDA allowed this trial to go ahead based on pre-clinical co-transfection efficacy results that appeared to me to be glorified in vitro, and not in vivo models of HepB infections. It may be for this reason that the study authors made the point that they saw antiviral efficacy in a model that did not involve co-transfection:

‘Preliminary data showed that 1% of mouse hepatocytes were transfected. Subsequent experiments in which spike recovery was performed demonstrated that nearly 10% of cells were transfected; actual rates varied between 6% and 9% (Nucleonics, Inc. and Alnylam, unpublished data). A number of explanations for the discrepancy between this rate and the 20% knockdown of HBsAg have been postulated.’

‘A 20% knockdown of HBsAg’ to me does not sound like a robust pre-clinical efficacy result in support of clinical studies. I doubt that the FDA would have let the IND application pass solely based on this animal efficacy model.

I know, a non-viral ddRNAi approach sounds great on paper, and would you believe it, not just the VC investors and Nucleonics management were fooled, but also a company like J&J was about to contribute a fair amount to a planned $25M round C capital raise.

NucB1000 phase I results

Altogether only 3 of the planned 15 patients received NucB1000 in the phase I study. This was the first dose cohort which involved 5mg of plasmid DNA, ~0.06mg/kg. As expected, immune stimulation was observed in all 3 patients: a transient fever, accompanied by cytokine elevations, which quickly resolved following antipyretic treatment. This was described by the authors as a mild event and not a reason why patients would have dropped out of the trial- definitely not ‘life-threatening’.

Needless to say, given the nature of NucB1000 and the size of the trial, no signs of antiviral efficacy was seen.

To this day, it is not clear to me why exactly the trial was terminated. Did Nucleonics and their investors attempt a Hail Mary with the first dose cohort before cutting their loss on an increasingly improbable investment, or did they suddenly get cold feet as allegations of scientific misconduct relating to the pre-clinical data were raised? Given that money and lawsuits were involved, I favor the former with the latter serving as justification.

Curious publication

Overall, the Gish et al. paper is a most unusual one. The introduction already states:

'The proprietary nature of these data imposes limitations; however, the authors felt the results merited presentation and discussion as they involve a first-in-human study with potentially important clinical implications.'

I agree that the data was valuable, if not somewhat predictable, and am glad the authors had the courage to publish them. At the same time, the publication can also be read as a justification for why the trial went ahead.

It is also a curious publication because it suggests that Alnylam did not just acquire the Nucleonics IP estate to bolster its synthetic RNAi IP, as Barry Greene stated at the time, but that it was quite a bit more interested in DNA-directed RNAi Therapeutics in general, and NucB1000 in particular than one would have thought. While it cannot be determined conclusively how much NucB1000-related work was actually performed on Alnylam’s dime, the following passages suggest that it was not insignificant:

‘Exhaustive cell culture studies have demonstrated specific down-regulation of all HBV RNAs, including pregenomic RNA as compared with mismatch controls (Nucleonics, Inc.; Alnylam Pharmaceuticals; CS and CP, unpublished data; Recombinant DNA Advisory Committee).’

‘Additionally, significant inhibition of HBV antigen expression and viral replication is also observed, and is consistent with mRNA knockdown (Nucleonics Inc. and Alnylam Pharmaceuticals; CS and CP, unpublished data).’

'When administered intravenously, the nanoparticle been shown in preclinical models to transfect hepatocytes and delivers the eiRNA plasmid to hepatocytes and to the cells of some other tissues, such as the skin (Nucleonics, Inc. and Alnylam Pharmaceuticals, unpublished data).’

Etc, etc, I think you get the idea. But before Benitec supporters get excited about this, I would caution that Alnylam’s situation 3 years ago was much different from what it is today. With a dwindling cash reserve and after Tuschl, Tekmira, and Bass, Alnylam’s appetite for confrontation and lawsuits should have cooled considerably.

This story is yet another example of how concern about appearances (virus = scary) and short-term profit thinking (questionable model systems and lack of scientific rigor) in RNAi Therapeutics caused precious capital to flow into undeserving projects and lawsuits.

Solid Calimmune DNA-directed RNAi Therapeutics Candidate for HIV Nearing Clinical Development

With the backing of a $20M grant from the California Institute of Regenerative Medicines (CIRM), Calimmune has made progress in advancing a DNA-directed RNAi (ddRNAi) Therapeutics candidate for the treatment of HIV/AIDS towards clinical development in early 2012 (here a recent blurb in the Financial Times). Similar to an HIV candidate developed by City of Hope (CoH) and Benitec before it, the new treatment involves the modification of a patient’s own blood stem cells (hematopoietic stem cells, HSC) with a gene therapy comprising of an expressed small hairpin RNAi trigger. Although Calimmune is not prepared yet to share the details of this program, based on my review of the research conducted by groups associated with Calimmune, the likely candidate has the potential to become one of the most exciting ddRNAi Therapeutics product candidates to enter the clinic yet.

HIV therapy today and motivation for gene-based stem cell therapies

The treatment of HIV has made tremendous progress. Once a certain death sentence, for those with access it has instead largely become a chronic infection that can be kept in check with cocktails of small molecules targeting a variety of stages in the viral life-cycle (highly active antiretroviral therapies or hAART). Nevertheless, the need for taking daily pills for life comes at the cost of side effects, generally reduced quality of life, and the emergence of viral resistances. There is no cure yet for HIVAIDS.

Actually, there might be one example of a cure for HIV. In 2006, an AIDS leukemia patient, aka the Berlin patient, underwent a bone marrow transplant as a treatment for his leukemia. The doctors selected a bone marrow donor whose cells carried defects in the CCR5 gene on both chromosomes. After the transplantation, the patient was not immediately put back on antiretroviral therapy to allow for recovery of his new hematopoietic system. Surprisingly, despite the absence of drug treatment, the virus has not recurred to this day leading more and more experts to talk of the first functional cure of HIV/AIDS.

In hindsight, this result did not come totally as a surprise. CCR5 had been known to be an important entry receptor for the common CCR5-tropic HIV isolates. Epidemiologic evidence gathered in the mid 90s indicated that people with certain CCR5 deletions on both chromosomes were protected from HIV infection, and those with a CCR5 defect on only one chromosome had, on average, delayed disease progression and improved life expectancies. In fact, this research led to the development and recent approval of a class of drugs blocking the CCR5 protein (e.g. Maraviroc by Pfizer).

There remains, however, great interest in developing gene-based stem cell medicines against CCR5 (and other HIV viral and host targets) in the hope of generating HIV medicines with less side effects, reduced chance of viral resistance (one way of HIV resistance to drugs targeting the CCR5 protein is to bind to CCR5 in the presence of drug), and maybe even a cure. The Berlin patient indicates that CCR5 may be an ideal target for such gene-based stem cell therapies.

Two possible mechanisms by which such a strategy may succeed are based on eradication of HIV-permissive cells as they are killed off by the virus while the CCR5-impaired cells persist, or by improving the immune function of CCR5-impaired cells thereby allowing them to fight HIV infection in other places.

City of Hope/Benitec and the first DNA-directed RNAi Therapeutic for HIV

Calimmune’s ddRNAi candidate is not the first one for HIV. The City of Hope, with the financial backing of Benitec, already entered one into clinical development (rHIV-shl-TAR-CCR5RZ), results from which were reported last year in Science Translational Medicine. Recognizing the advantages, if not need, for targeting multiple stages of the HIV life-cycle at once, this candidate was not a pure ddRNAi therapeutics, but a triple RNA therapeutic that in addition to the shRNA RNAi trigger which targeted the viral tat/rev mRNA involved an expressed TAR RNA decoy and an expressed (RNA) ribozyme targeting CCR5. Notably, all three expression cassettes were driven by U6 promoters.

The expression cassettes were placed in a shared lentiviral vector and thus introduced ex vivo, i.e. outside the body, into hematopoietic stem cells isolated from the enrolled AIDS lymphoma patients. Because hematopoietic stem cell transplantation with full bone marrow ablation is associated with risks, but is standard second-line therapy for AIDS-related lymphoma, this patient population was chosen so that the trial participants would simultaneously receive a treatment benefit for their lymphoma while participating in this experimental trial. As an added measure of precaution, the majority of hematopoietic stem cells were left untreated and given together with the modified stem cells to ensure that the immune system would be reconstituted even if something went wrong with the gene therapy.

Four patients were treated per protocol in the phase I trial. Unfortunately, while there was no obvious significant adverse event as a result of the gene therapy, the molecular analyses indicated that rHIV-shl-TAR-CCR5RZ may not be the most promising RNA therapeutics candidate for HIV. Specifically, while the initial transduction efficiency was in line with what would have been expected for lentiviral delivery (~20%, see X-linked adrenoleukodystrophy trial here), the transduced cell population declined rapidly and the ones that persisted were just about detectable- too few to be therapeutically promising.

If this candidate were to be further developed, an important goal would be to increase the fraction of stem cells that are modified. This could either be by improving the transduction efficiency, by only providing stem cells that were treated with lentivirus instead of providing the untreated stem cells as a backup, or by using a protocol that chemically selects for the modified stem cells after their re-infusion. Still, I am skeptical that this would solve the problem as in light of other lentiviral and retroviral clinical experiences the observed decline in transduced cells seemed to be specific to rHIV-shl-TAR-CCR5RZ. It is therefore possible that some inherent toxicity of the expression cassette itself, possibly due to the use of U6 promoters, accounted for the poor long-term persistence of modified stem cells.

The Calimmune approach: A non-toxic, H1-driven shRNA targeting CCR5

The reason why I feel that Calimmune’s approach may have better prospects is that it has fully accounted for the U6-related shRNA toxicities and selected an H1 promoter-based RNAi expression cassette that was shown to be both safe/stable and, equally important, highly efficient in CCR5 knockdown in human and rhesus HSC-derived cells. Also, I like the fact that it is an RNAi trigger, and not a ribozyme, that is targeting CCR5, as I believe this to be the more efficient knockdown modality.

While Calimmune has yet to fully disclose their eventual clinical candidate, the one reservation that I have about the putative candidate at this time is that they may have failed to take advantage of the combinatorial potential of RNAi Therapeutics. With combinatorial potential I do not necessarily mean here combining ddRNAi with other RNA (like CoH/Benitec) or protein expression modalities- in fact, it may be scientifically 'cleaner' to use just RNAi for now- but targeting at least two HIV-related genes instead of one to minimize the emergence of viral resistance.

The panels on the left depict what in my mind have been the most impressive dataset from the development program. It shows the results from a rhesus monkey model in which the ddRNAi trigger was introduced into blood stem cells from two monkeys (RQ3570 and RQ5427 for those with good eyes) which (panel A) led to solid, long-term (!) 6-20% cell marking in the various cell lineages of the blood. Moreover, when the cells were sorted into those that were transduced (black bars, panel B) versus those that were not (grey bars, panel B) and the CCR5 levels measured in the respective cell populations, the CCR5 was found to be down-regulated by 80-90% in the transduced cells. And since your experiment is only as good as your negative controls, data from a control animal that received a lentivirus without the RNAi trigger (2RC003) show no differences in CCR5 levels between the two cell populations.

While I have yet to see the obligatory HIV in vivo challenge studies with this putative candidate, based on CCR5 genetics, a candidate with such transduction levels and knockdown potencies should stand a good chance at improving CD4+ T-cell counts for enhanced immune system vigor and delaying or maybe even eradicating HIV over time.

It is debatable to what degree a full CCR5 knockout compared to a highly potent CCR5 knockdown would bring additional benefits. Sangamo Biosciences for example has made tremendous progress in increasing the efficiency of gene disruption using their Zinc Finger Nuclease technology. Not surprisingly, this company also has a CCR5 hematopoietic stem cell candidate in the early pipeline. In a 2010 Nature Biotechnology paper, Sangamo reported an estimated frequency of 5-7% homozygous CCR5 gene disruption in human hematopoietic stem cells, and another 10% heterozygous gene disruptions.

Simplistically, taking upper estimates, ddRNAi may provide for 90% CCR5 knockdown in 20% of cells whereas ZFN technology may delete CCR5 altogether in 7% of cells and knockdown CCR5 by half in another 10%. Because these numbers are close and a clean knockout in some cells may make up for the slightly decreased overall knockdown levels, I would be even more excited to see Calimmune's current lead candidate paired with at least another shRNAi trigger, thereby exploiting said combinatorial potential of ddRNAi Therapeutics which ZFNs cannot provide as easily.

Benitec license?

Benitec, of course, will follow Calimmune’s developments with great interest as the company has rights to critical ddRNAi trigger patents. Curiously, both companies are based in Australia, but have significant roots also in the US South-West, so it should be possible to come to an amicable agreement.

License or not, it will be good for the entire field of RNAi Therapeutics, and ddRNAi Therapeutics in particular, for this trial to get underway in 2012 as it should attract significant general interest to a what looks like a solid RNAi Therapeutics candidate.

Acknowledgement: The idea for this blog came from a reader that alerted me to this interesting RNAi Therapeutics candidate that had flown below my radar, and maybe also to placate another reader that complained that the Tekmira-Alnylam feud was taking up too much space and there were other interesting things happening, especially in ddRNAi Therapeutics. So if you know of exciting RNAi Therapeutics developments that you believe I may be missing, please let me know by email (first name dot last name at gmail dot com). In most cases, I won’t be able to write about it immediately, but it won’t be forgotten either.

Update: On March 5, 2012, Calimmune acquired a global, non-exclusive license from Benitec to use ddRNAi in HIV/AIDS.

Tectonic Shifts in RNAi Therapeutics

As consolidation in RNAi Therapeutics in the Old Economies continues, the balance of power is rapidly shifting towards the resource-rich and growing economies of the Far East where national RNAi champions are set to make their mark on the international RNAi Therapeutics scene.

After some notable mergers between private and public RNAi companies (Intradigm-Silence, Cequent-Marina Biotech), and the decision by some, albeit not all, Big Pharma companies to turn their backs on RNAi Therapeutics development in-house, a contraction of the publicly traded pure-play RNAi companies seems inevitable. Arrowhead Research (ARWR), despite its name, has long stopped internal RNAi research and its technology is getting stale by the day, the captains of RXi Pharmaceuticals (RXII) have decided on a course that is entirely incompatible with it continuing to be an RNAi platform company, Marina Biotech (MRNA) despite its good intentions signaling to the world almost daily that it is in distress and has not found anything worth focusing on, and the executives of Rosetta Genomics (ROSG) personally making sales calls as the company continues to bleed money.

Some of these companies do have interesting technologies worth funding in my opinion. RXi’s sd-rxRNAs are well differentiated and complementary to the established RNAi trigger structures, Rosetta had established a prolific microRNA diagnostics machine, and Marina Biotech built a very able and what seems to be enthusiastic RNAi Therapeutics team, but probably invested too aggressively hoping for an early turnaround in RNAi sentiment that would lift all boats. There may be a rationale for conserving some of that value by a) spinning out (RXi) and/or merging technologies that are synergistic (ROSG); and b) selling themselves for a small premium for its practical RNAi research expertise (MRNA).

The pure-play survivors may be the following: Alnylam, Tekmira, Silence Therapeutics, and Benitec. Alnylam is obvious, because of their cash and an aura that makes investors and pharmaceuticals partners pay a premium for their assets (I expect the VSP and Atu027 deals to reflect this). Tekmira as the delivery experts and also benefitting from diversification tendencies in the resource-driven Canadian economy, an investor base, however, that Tekmira needs to tap more aggressively. Silence Therapeutics with its recent progress in delivery, some valuable RNAi trigger IP, and supported by an investor base that has widened in the wake of its merger with Intradigm to cover the US, UK, and Germany. And finally Benitec which has positively surprised me by its recent recapitalization which puts it again into the category of drug developers and not just an IP play. Certainly, the re-issuances of a fundamental ddRNAi trigger patent have helped, but I don’t think this recapitalization would have been possible without resource-hungry China buoying the Australian economy.

Alnylam: RNAi trigger IP, brand and industry connectivity.

Tekmira: problem solvers, delivery powerhouse.

Silence: RNAi experience, broad investor base.

Benitec: ddRNAi powerhouse, Australian economy and proximity to China.

Benitec probably best symbolizes the shift in RNAi Therapeutics towards the countries with most economic growth. While its commercial focus may still be with the traditional markets for innovative medicines (US, Europe, Japan), its research activity, once in the US, has shifted to the East as illustrated by its collaboration with Biomics on HBV. This collaboration both taps into the geographic proximity with China as well as the growing scientific expertise that can be paid for with the strong Aussie dollar.

Don’t be surprised if the leading RNAi Therapeutics candidate for scarless wound healing will be developed in China (Sirnaomics), and not by RXi in the US, or if the first RNAi agent with human use will be marketed in the Far East and not the US or Europe just as it happened in gene therapy. Some of it may be explained by less stringent standards of patient protection in these countries, but it would be a mistake of complacency to use this as the only explanation.

Whether it will be Biomics, Sirnaomics, BMT, or others remains to be seen, but the flow of investment dollars firmly points towards a global shift in RNAi Therapeutics development and commercialization. Smart minds and outstanding technologies are one part of the equation, financial backers with deep pockets the other.

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.

RNAi Therapeutics Portfolio Update: Sell Targeted Genetics, Buy Benitec

As I intend to manage the RNAi Therapeutics portfolio more aggressively for performance rather than being more of a representation of the state of RNAi Therapeutics investments, I have decided to take advantage of yesterday’s strength of Targeted Genetics on news that it completed its asset sale to Genzyme. Despite exciting results from their ocular Leber’s Congenital Amaurosis program and what this may imply for the use of AAV in ocular RNAi Therapeutics, at this point there is too little evidence that RNAi Therapeutics will play an important role in the foreseeable future of Targeted Genetics to justify its place in the portfolio, especially in light of almost non-existent active research and development and talent outflow.

The proceeds will be re-invested in Benitec as there are signs that this company could emerge as the only proper surviving DNA-directed RNAi Therapeutics player. News from last week that Pfizer will continue to develop a HCV ddRNAi Therapeutics in which Benitec has a significant stake and a recent patent grant for an hairpin with a long loop are very encouraging.

Disclaimer: Investments in RNAi Therapeutics are highly risky and not suited for most people.The purpose of the blog and model portfolio is to convey a sense of the dynamics in the field and is NOT an endorsement for making related investments. I also have financial interests in some of the companies included in the portfolio. I do not, however, have short positions in any of those.

Pfizer and GSK to Invest more in RNAi Therapeutics

GSK launches rare diseases unit: Today, GSK announced that it will move more aggressively into addressing rare diseases and set up a unit for this. The rationale is that developing medicines for diseases that have largely been neglected by the pharmaceutical industry in the past will have a good pharmaco-economic profile and ultimately be more profitable. More and more, selling pills to the masses does not appear to be the answer to Big Pharma’s patent woe and productivity cliffs. This should be very good news for RNAi Therapeutics, which offers a direct and cost-efficient way to such (often genetic) diseases, and maybe we will see this deal between GSK and Alnylam later this year.

Pfizer exercises option for Tacere’s HCV candidate: DNA-directed RNAi company Tacere, a Benitec spin-off, announced today that Pfizer has exercised its development-commercialisation option for Tacere’s HCV drug candidates. Pfizer obtained the option in the deal 2 years ago with Tacere (see blog entry here). This follows pre-clinical studies in rodents and monkeys that, according to the press release, have shown the AAV vector to penetrate the liver well and to be generally well tolerated. Pfizer will now collaborate with Tacere and fund the IND-enabling studies. This triggers undisclosed milestone payments, some of which will be due to technology licensor Benitec which, in addition, has an equity stake in Tacere. There is hope for ddRNAi Therapeutics!

Run-Down of Companies in the RNAi Therapeutics Portfolio

Alnylam: As the bellwether of RNAi Therapeutics due to its IP position, maturing pipeline, strong balance sheet and a generally broad outlook on RNAi Therapeutics, a must for those (institutional) investors with significant funds to invest in the RNA Therapeutics space. Data from Alnylam’s Huntington’s Disease and RSV programs suggest that they have potential on their own, independent of how they contribute to the learning of RNAi for CNS and lung disorders in general. Surely, the hiring pattern of Big Pharma argues that the perception of RNAi as a therapeutic modality has not gone out of fashion there, immediately adding potential licensees to Alnylam’s leading RNAi trigger portfolio.

However, as it is delivery that potential licensees and investors are increasingly paying attention to and even cash-rich Big Pharma/Biotech will question whether it should spend $300M for an RNAi trigger license now that there have been a few decisions that did not go in Alnylam’s favor, I am not sure whether we will see a simple pre-packaged RNAi trigger platform deal. Rather, such IP access may be packaged with access to Alnylam’s know-how on the delivery, chemistry, and safety of RNAi Therapeutics, somewhat reminiscent of the Roche deal and the Kulmbach component. To set up such deals may take longer, but ultimately provide more value not only for the licensee, but also for Alnylam. Certainly, positive SNALP clinical data should prove as a catalyst for these negotiations and the stock.

Tekmira: If you did not know already, my favorite RNAi Therapeutics investment right now. Pioneered the, in my opinion, most advanced systemic RNAi delivery technology, SNALP, which renders the Canadian $50M market cap company fully exposed to the major value drivers in the space near- to mid-term. The well validated ability to deliver oligonucleotides to the liver with SNALP will make Tekmira not only an attractive collaborator and acquisition target in RNAi Therapeutics, but should offer it new business opportunities outside the traditional siRNA structure. This includes various forms of microRNA mimics and inhibitors, immunostimulatory oligonucleotides, and oligos for targets based on emerging non-coding RNA pathways or other knockdown mechanisms. Mir-122 inhibition with SNALP may be an interesting pharmacologic alternative to the naked LNA-anti-miR122 by Santaris now in late phase I studies. Demonstrating the utility of SNALP outside the liver, such as for solid cancers and cells of the immune system (maybe by using targeted delivery) could further increase the perceived value of this conservatively managed company. With about two years’ worth of burn in a relatively good financial position.

I should temper my enthusiasm, however, as there are no sure things in biotech and the first use of SNALP in Man may well yield some unpleasant surprises and could dramatically change the outlook for the company. Similarly, it needs to think ahead about how to access a broader investor audience outside of the Canadian market as its own pipeline is growing in size and capital demand. A good bet nevertheless.

Benitec: Faces an uphill battle with regards to their core DNA-directed RNAi patent, essentially pitting it against mighty Fire-Mello. However, as time progresses and the ’099 Graham patent not getting any younger, I’m starting to have doubts as to how important this patent will prove to be. Other patents assigned to Benitec, the HIV programs, and potentially the Biomic collaboration may prove to be of more immediate practical value to the company. What is needed, of course, is a re-capitalization of the company.

Targeted Genetics: This cat has 8 lives. I had been quite confused that after almost everything scientific and clinical was going in Targeted Genetics’ favor, the company was rapidly approaching bankruptcy. Society and the investment world are not always fair, which is a warning to those investing just according to scientific principles. Now, Genzyme has come to the rescue, but it remains to be seen how committed the company is to its RNAi pipeline. It would make sense for RNAi to be part of a company focusing on diseases of the eye (and CNS) for which AAV and lentiviral gene therapies currently have most promise (the eye as the liver of DNA-directed RNAi).

RXi Pharmaceuticals: Experienced management and scientific team, access to Tuschl I and preferential treatment by the state of Massachusetts, yet for some reason very little drive towards the clinic and financially challenged. Instead of a clinical pipeline, a pipeline of ‘interesting’ RNAi trigger and delivery approaches. I’m still not sure about what their rights to Tuschl I are that have recently been characterized as ‘limited’ in scope. This, however, and the Massachusetts/Mello connection are probably the biggest draws for the stock. Still, without being able to offer complementary practical know-how I would think Big Pharma is not too anxious to access RXi as a partner.

Silence Therapeutics: Similar to RXi Pharmaceuticals, stands to greatly benefit depending on the messiness of the Tuschl patent outcomes where Silence’s ability to operate in the 21-23nucleotide space is at stake. Also reasonably successful in battling the patent that most likely imposes most constraints on the company, namely Kreutzer-Limmer. While nobody would doubt Alnylam’s freedom-to-operate (however questions have been raised as to the degree of being able to exclude), my fundamental question about Silence Therapeutics is whether what may be a patent work-around also makes for the best scientific approach. Their underlying patent application is based on quite limited data, so I have yet to be convinced of any real generally applicable scientific advantage of the Atu-RNAi design (nevermind, at least in terms of IP, my opinion does not matter much since the European and US patent offices appear to concur with Silence). Things have been looking up recently for the company and its Atu-027 program for advanced solid cancers has started phase I dosing. This program aims at silencing the PKN3 kinase in the endothelia of solid tumors which apparently inhibits metastatic spread through reduced lymphangiogenesis. An interesting approach towards RNAi cancer therapy and has been described in a detailed company publication late last year that provided reasonable support for bona fide in vivo gene knockdown using lipoplex delivery (Aleku et al., 2008). One interesting point I found in that publication was that in cynomolgous monkeys, the circulation time of the particles was greatly extended to what they found in rodents. This can only be a good thing for the prospect of lipid-based nanoparticles.

mdRNA: Together with Targeted Genetics, another unlikely survivor from the financial crisis coming from Seattle. Two deals with Big Pharma, one on delivery (Novartis), and one on siRNA structure (Roche), early this year contained enough upfront to give the company another couple of months to get itself on sounder footing. Similar to Silence Therapeutics, their main delivery approach consists of essentially the same chemistries as contained in SNALP and apparently lends itself to targeted delivery (which, however, is not a unique property of their technology). Also, I would be cautious about claims that putting UNA-modified nucleotides in the 3’ overhang of siRNAs would liberate them from claims in Tuschl II. UNA modifications appear to be a viable option for the siRNA modification toolbox, but I would be cautious in how far they are uniquely advantageous over other chemistries at last according to an excellent, comprehensive siRNA modification screen as published by Bramsen et al. this year. In any case, the fresh, and apparently well-connected management team can be congratulated for rescuing the company, and the scientific team for their skills in being able to rapidly adopt oligonucleotide modification and liposomal delivery skills at least to the degree that Big Pharma is curious enough to look under their hood. I would like to speculate that if RXi e.g. had built such practical skills in-house, we may have seen some deals that would not have been as dilutive as recent efforts to raise capital.

Rosetta Genomics: After having apparently staked their future on a blood-based test for colorectal cancer screening, it has reported that these plans have been slightly delayed due to technical issues. The poster on the colorectal cancer-related microRNAs in blood that had been presented previously certainly showed initial proof-of-concept for blood-based microRNA diagnostics, but more robust detection methods are needed in order to make such tests a commercial reality. It is debatable whether the one-shot strategy was a wise one, instead of churning out a series of tissue-based Dx albeit with a much smaller target market. If blockbuster products like a screening test for colorectal cancer were a primary business goal, then an alternative route may be to collaborate on Rx-Dx combinations which however are much onerous to develop than home-brew Dx and may require a partner like Roche. There may be a number of regulatory and health care reform issues that could affect the future prospects of being able to sell and get reimbursements for home-brew Dx. On a positive note, according to my literature, I have stumbled across enough references by Big Pharma on the potentially unique utilities of microRNA Dx that I believe the concept has well arrived in the minds of important constituencies for Rosetta. A pick-up in sales of their first products would also be welcome by investors. Due to a number of synergies, companies like Regulus may also be a good home for Rosetta Genomics.

ISIS Pharmaceuticals: There is certainly a flood of ISIS-related antisense in various stages of clinical development, some with interesting results indicating efficacy. Mipomersen meanwhile blazes the trail for ApoB as a target for hypercholesterolemia, and assuming it will confirm phase II results, I am curious about how much of the patient audience Genzyme is able to capture. This should also have implications for the financial potential of follow-on ApoB therapeutics. ISIS also was successful in monetizing their IP for ssRNAi with almost $21M (! a high number considering the stage of ssRNAi and other deals that Alnylam has done in the past) in upfront and near-term payments from Alnylam, while still being able to develop ssRNAi Therapeutics itself. OK, you know that I have some problems with how ISIS likes to interpret RNAi as an antisense technology, so please allow me this comment: if RNAi already was a single-stranded antisense technology, how is it then possible to claim ssRNAi as a separate technology without running afoul double-patenting rules? Anyway, I acknowledge that ISIS is on a good way of becoming a sustainable, profitable oligotherapeutics company and probably should be part of a diversified RNA Therapeutics portfolio.

Oxford Biomedica: Despite disappointing cancer vaccine results causing partner Sanofi-Aventis to give up on Trovax, Oxford Biomedica must have been able to impress Sanofi-Aventis with their core leniviral delivery technology (note: Trovax is not a lentiviral technology). Sanofi-Aventis thus seems to agree that lentiviral delivery has significant potential for applications of the CNS, including the eye. However, as I hear little about Oxford Biomedica using its IP and know-how in RNAi, I will consider replacing it with companies like Genesis R&D in my next portfolio update. There is certainly a lot of DNA-directed RNAi Therapeutics technology and IP looking for a well-funded home.

[Please note that the following is a run-down of my own impressions of companies in the portfolio and links are not necessarily provided for all major assertions. Please use the comments section if you believe that there are factual inaccuracies]

HBV Collaboration between Benitec and Biomics Indicates Shift in DNA-directed RNAi Therapeutics towards Asia

My four years as a post-doc here in Stanford, during which my advisor Mark Kay served a term as the President of the American Society for Gene Therapy, taught me that drug development is as much about politics and perceptions as it is about the science.

This is particularly true when it comes to gene therapy and it is no surprise that despite pre-clinical data that, taken together, often surpassed that obtained with synthetic siRNAs, DNA-directed RNAi (ddRNAi) Therapeutics is struggling for funding in the corporate world. Targeted Genetics is a prominent example of a gene therapy company that despite much scientific (AAV-delivered RNAi data for Huntington’s Disease) and clinical progress (saving patients from blindness) is now facing bankruptcy. The reason? The regrettable death of a patient in a Targeted Genetics-sponsored clinical trial that has now been linked by experts to a immuno-suppressive monoclonal antibody the trial participant had been taking. The case was taken to the level of an NIH RAC (recombinant advisory committee) hearing, and synthetic oligonucleotide therapeutics companies are quite right in being scared that they, too, may be subject to RAC review in the future. I wonder what the outcome was from a recent meeting to discuss just this matter.

I am aware that gene therapy carries risks. Western society, however, needlessly deprives itself of potentially life-saving treatments when it chooses to suppress the entire field following isolated, albeit very unfortunate cases of adverse events linked to gene therapy. Then there are the so called ethical concerns of changing the human genome by introducing DNA into our cells as if sick patients had the luxury of worrying about this. By contrast, news of drug-related deaths in clinical trials of small molecules, many of which unlike the commonly used viral vectors have never been introduced into the human body, hardly ever reaches the wider public.

This week’s memorandum of understanding between Australia’s Benitec and China’s Biomics to collaborate on a DNA-directed RNAi therapeutic for chronic hepatitis B virus (HBV) infection may be a sign that the near to mid-term future for ddRNAi may instead lie in the economically vibrant parts of Asia. Here, practicality and an eagerness to adopt innovation means that gene therapies fall on much more fertile ground, including funding. Just last year, Benitec spin-off Tacere signed a similar deal with Japan’s Oncolys for the development of an ddRNAi Therapeutics for another viral disease of the liver, hepatitis C virus (HCV) infection.

Funding and access to R&D may have been financially struggling Benitec’s main motivation to reach out to Biomics. Also, Biomics provides Benitec with a foothold in a country that faces end-stage liver failures and hepatocellular carcinoma caused by chronic HBV that are of epidemic proportions. On the other hand, while Biomics, a biotech company with locations also in the US and that, with the help from some former Nastech employees, strives to transform itself from a mainly RNAi research-reagent company into an RNAi Therapeutics developer, certainly appears to enjoy better economic health and brings with it RNAi know-how, ideally it would have complemented Benitec ddRNAi patent estate and insights into shRNA design by providing an advanced delivery technology, maybe AAV. Although it is possible that they have such a technology, this is not apparent from the company's website which describes a range of delivery modalities that they are apparently working on.

For RNAi Therapeutics in general, Asia not only provides a growing market, but also an enormous R&D opportunity with many highly trained, detail-oriented chemists and increasingly also biologists to draw from. I am often surprised for example how many chemistry- and gene therapy-based publications on RNAi delivery come out of a country like Korea which is relatively minor in terms of biomedical research budgets, yet is little capitalized on due to lack of risk capital there. As for the IP situation in a country like China, I believe that once it becomes relevant, that is in maybe 7-15 years, China should be more aligned in this regard with the rest of the world and it would be a mistake not to make an effort of protecting your RNAi Therapeutics IP there, too.

HBV played a prominent role in the history of RNAi Therapeutics. Both synthetic (SNALP RNAi) and DNA-directed approaches proved successful in repressing HBV replication in mouse models. Since suppression of viral replication is a well-accepted measure for predicting HBV treatment success, RNAi Therapeutics should very well be able to complement current interferon-alpha and nucleoside analogue-based standard of care that result in unsatisfactory treatment success rates of only 20-30%. Due to the nature of the disease, however, it is unclear to me whether synthetic siRNAi or ddRNAi would be preferable. However, since treatment success by nucleoside replication inhibitors requires long-term treatment, probably due to the persistence of viral DNA in hepatocytes, a gene therapy approach has certainly theoretical justifications.

And finally, following Nucleonic’s fall and the situation around Targeted Genetics and Benitec, it is time for the entire RNAi Therapeutics field to think about creating a strong ddRNAi Therapeutic company before much of the IP is squandered. Consolidation of these efforts into a re-capitalized Benitec (disclosure: no current investments) may be one, although not the only option.

The Potential for AAV-mediated RNAi Therapeutics

There is good reason to believe that synthetic siRNA-mediated RNAi Therapeutics should emerge as the most commonly used form of RNAi Therapeutics. Nevertheless, DNA-directed RNAi Therapeutics also has a number of potential uses where it should not only be competitive with, but even superior to synthetic RNAi. Unfortunately, the commercial development of DNA-directed RNAi Therapeutics has been somewhat hampered due to litigation and other management issues as well as funding problems that all things “gene therapies” face. In an effort to dispel some of the myths surrounding DNA-directed RNAi Therapeutics and since I’m somewhat familiar with particularly AAV-mediated DNA-directed RNAi, I would like to take the opportunity here to briefly highlight some of the potential applications for this particular technology.

DNA-directed RNAi can either by delivered by non-viral or viral means. For the most part, current systemic non-viral delivery technologies for DNA vectors that need to get into the nucleus for functional activity may not be adequate as a result of their inability to transfect sufficient cell numbers as well as support long-term expression. By contrast, viral vectors, particularly AAV and lentivirus, are capable of very efficiently and stably transducing many cell types. In fact, in vivo potencies are often greater than with most current synthetic RNAi methods with essentially knock-out phenotypes in the liver and eye observed for months and years using self-complementary AAV8 vectors in work reported by the laboratory I work in and collaborators to name just one example.

Before focusing more on AAV with which I am most familiar with (learning by osmosis), lentivirally delivered RNAi has much potential for disease of the CNS, largely for the same reasons as outlined for AAV below, and in combination with cell therapeutics. The latter would involve the ex vivo transduction of lentiviral RNAi constructs for example into stem cells similar to the ongoing phase I HIV-RNAi trial by the City of Hope and sponsored by Benitec, or also to enhance dendritic cell cancer vaccine strategies. Many of these applications take advantage the stable integration of lentiviral vectors into the host genome such that the vector and its expression/knock down will be maintained even in dividing tissues.

By contrast, due to its largely episomal nature, AAV gets rapidly during cell division thus limiting their applicability for cancer therapy or in other situations that involve cell division (regenerating liver, stem cell differentiation etc). Moreover, in certain settings humoral and T-cell mediated immune responses against AAV viral proteins present another challenge for achieving persistent gene silencing (the transduced cell may be recognized by the immune system and be eliminated) and where repeat-administration is desirable (due to neutralizing antibodies generated following the first administration).

For these reasons, AAV RNAi appears most promising for diseases of the eye and CNS as immuno-privileged sites. Although infusion pumps may address some of the challenges of allowing for long-term intracranial gene silencing by synthetic means, due to the ability to mediated sustained gene silencing for 6-12 months if not several years as suggested by canine AAV studies for hemophilia, the prospect of maybe having to subject a patient only once or very few times to an invasive operation makes AAV and lentivirus attractive alternatives for diseases such as Huntington’s Disease and other neurodegenerative disorders.

Not coincidentally, Targeted Genetics and the University of Iowa are currently pursuing an AAV RNAi program (pre-clinical stage) for Huntingon’s Disease that has shown promise. A critical factor for the success of this program should be the design of the shRNA expression cassette, and I personally would feel more comfortable with an H1 promoter-driven instead of a U6 promoter-driven construct that has been the front-runner so far. Another interesting application may be for the treatment of PML viral infection. Biogen Idec and Alnylam have been working on an siRNA-mediated approach, but due to serious nature of JC virus reactivation during PML, rapid onset of gene silencing by self-complementary AAV RNAi and the efficient vector delivery achieved for a number of neuronal cell types, AAV-mediated RNAi warrants consideration for this devastating disease.

Suitable non-CNS applications for AAV ddRNAi candidate may be instances where a single administration may already be therapeutic without the need for sustained gene silencing and repeat administration. HCV infection of the liver may be one such case as it is now possible to essentially transduce every liver cell, at least in mice, and effect long-term silencing after a single administration. AAV-medicated RNAi could therefore be an important component of combination therapies for patients that do not respond to current therapies and could also quite easily be tailored to the different HCV genotypes. Pfizer just recently acquired co-development rights for the pre-clinical stage AAV RNAi program for HCV from the Benitec spin-off Tacere.

AAV gene therapy is relatively new, but it is making rapid progress. Two independent phase I/II AAV gene therapy trial for Leber’s Congenital Amaurosis caused by RPE65 deficiency, a condition that leads to blindness later in life, demonstrated clear improvement in vision and treating children early on promises to even cure the disease. One of the studies was conducted by an academic group in London and was sponsored by Targeted Genetics, the other by a group from the University of Pennsylvania.

It is not clear whether an immune reaction that eliminated transduced liver cells in a hemophilia trial was specific for the AAV 2 serotype used, as most of us will have been exposed to this type of AAV during childhood and may therefore harbor some immune memory for it. A number of strategies have been proposed to minimize the risk of immune recognition in future trials, for example transient immune suppression or the use of alternative serotypes. The search for and development of alternative AAV serotypes is truly exploding and is rapidly yielding new AAV vectors with various tissue tropisms and immune properties.

The less AAV that needs to be administered the better also from an immune point of view. Very promising in that regard is the finding that the self-complementary AAVs which by-pass the rate-limiting second-strand synthesis step during the establishment of gene expression much more efficiently and functionally transduce target cells than conventional single-stranded AAV vectors. While this halves the vector capacity to less than 2kb, a size that is not very practical for expressing many protein-encoding genes, this does not matter at all in the context of small hairpin expression cassettes and appears to be just made for AAV RNAi. Actually, it was this property of self-complementary AAV vectors that was one of the main reasons for me to come to Stanford to conduct post-doctoral research. A patent for this possibly critically enabling technology has been issued to Targeted Genetics.

RNAi Therapeutics Portfolio Review: Increasing Position of Targeted Genetics

The technology is certainly there to be harnessed for therapy, but the development of AAV RNAi Therapeutics is not trivial and is a collaborative effort that requires careful gene target selection, safe and potent hairpin vectors, thoughtful clinical trial designs, and the manufacture of large amounts of high-quality AAV particles. Nevertheless, with the right team and some luck, it should possible to do.

It has both amazed and scared me to learn in a vivid report by RNAiNews that DNA-directed RNAi company Nucleonics whose lead program was a very long-shot (to put it mildly) RNAi program for HBV, was close to raising $25M in a series C round that would have included a venture capital arm from Johnson & Johnson. How that was even a remote possibility given the odds for that particular HBV RNAi program and the uncertain IP of that company is a mystery to me and makes the ~$13M market cap of Targeted Genetics’ look very cheap by comparison.

For this reason and given the promise of AAV-mediated RNAi Therapeutics in general, Targeted Genetics’ AAV gene therapy know-how and IP, including IP directly related to RNAi -especially the one for the double-stranded AAV and apparently another one for the expression of non-coding RNAs- I will add $680 worth of TGEN to the RNAi Therapeutics model portfolio and will pay for this with the sale of some stock in ISIS Pharmaceutcals (-$280), Oxford Biomedica (-$200), Silence Therapeutics (-$100) and Rosetta Genomics (-$100).

Remember, an investment in Targeted Genetics is highly speculative, its balance sheet somewhat ugly which is made worse by current market conditions which make it almost impossible to raise small biotech capital on reasonable terms. This investment thesis therefore is that Targeted Genetics will be able to win the race against the clock by being an attractive partner for other drug companies interested in RNAi Therapeutics with the resulting license fees and development milestones helping the company through the hard times. Maybe Genzyme with its considerable AAV gene therapy efforts and orphan disease management expertise or Biogen Idec with its long-standing ties to Targeted and interest in PML will bite.

Disclosure: The lab that I work in has an interest in AAV-mediated RNAi Therapeutics. The author has also been accumulating shares in Targeted Genetics between $0.58 and $0.72. The stock is not suitable for most due to adverse market conditions and the precarious balance sheet of the company. The thin trading volume of the stock causes volatilities in share price, usually to the downside, and there is a real chance that the stock will be de-listed from the Nasdaq exchange which will make this little company even more opaque to investors. On the other hand, conditions will improve at some point and in an environment where venture capital exits have become increasingly difficult and considering the attractive relative valuation and maturity of the company and technology, Targeted Genetics may represent an interesting, somewhat more liquid piece of RNAi Therapeutics real estate for investors otherwise specializing in private start-up companies.