Second-Tier RNAi Therapeutics Companies Starting to Deliver Clinically

Alnylam has had a 3 year head-start on the competition with GalNAc RNAi Therapeutics, but now additional companies are populating the field with actual clinical data.  While the knockdowns appear robust and the chemistries well tolerated, therapeutic utility and the potential of liver toxicity from off-targeting will have to be demonstrated in upcoming longer-term studies.

Dicerna clinically validates new target for primary hyperoxaluria

Dicerna used to be the leader in applying RNAi Therapeutics to primary hyperoxaluria (PH), an orphan genetic condition caused by dangerously high levels of oxalate in the blood.  Oxalate crystallization and deposition may then poison first the kidneys and then various organs leading to premature death.  Unfortunately, as its old LNP technology proved to be impractical, Alnylam's directly competing program targeting glycolate oxidase (GO) assumed the lead.

When Dicerna then came up with a GalNAc-based follow-up candidate (DCR-PHXC), it also chose a new target: hepatic lactate dehydrogenase (LDHA), a target which may have be applicable also for forms of PH beyond the most frequently diagnosed PH1 and for which GO is a suitable target.  Cynics may suspect that the new target was not chosen because it is the better one, but in an effort to provide differentiation over more advanced competition.  To wit, first-mover advantage can be significant in the orphan drug arena.

Perhaps due to its long-standing, deep relationship with the PH community, Dicerna has been able to recruit patients more quickly than I had suspected (in light of Alnylam's parallel recruitment efforts) in its first-in-patient study.  First data from this study (PHYOX) were revealed last week.  To their relief, LDHA knockdown resulted in oxalate lowering in all 9 subjects (8 PH1, 1 PH2) tested.

Following a single-dose of either 1.5mg/kg or 3.0mg/kg, at least 30% reductions in urinary oxalate were seen and all or almost all subjects got to urinary oxalate levels at or below 1.1mmol/24hrs/1.73m2, a level predictive of end-stage-renal-disease freedom.

More detailed data will be presented later this year where we will get a better sense in how the results stack up with those of Alnylam.  Earlier this summer, Alnylam reported 64% mean urinary oxalate reductions relative to baseline before following more than one dose.  Another area of concern is that it appears that 3 out of the 9 injections resulted in injection site reactions (ISR).  To see ISRs is not surprising per se, but the frequency appears to be on the high end based on early experience and could be a competitive disadvantage.  Similarly, no word was said about liver enzymes.

Given that Dicerna has been rushing the PHYOX trial without so much as testing multi-dose regimens, I expect the regulatory agencies to demand at least 2 dosing schemes in the upcoming pivotal trials.  A nightmare scenario would see Dicerna being sent back to phase II to test the safety of multi-dosing, a fate that Regulus Therapeutics had suffered before in Europe.

Disclosure: Over the last few months, I have been largely playing the volatility of DRNA- both on the long and short side.  Looking ahead to the end of the year, I would be hesitant of taking a substantial long position due to a market cap approaching $1B with the potential of negative surprises both on safety and efficacy when more detailed PHYOX data will be presented.  On the other hand, a deal (such as on the IND-ready mystery candidate) could provide a catalyst to the upside at least in the short-term.

Arrowhead sees best HBsAg knockdowns so far with new GalNAc candidate

When similar to Dicerna Arrowhead had to retool its lead programs with the GalNAc technology, one question was whether they could achieve knockdowns as potent as with DPC delivery which employed explicit cell penetrating chemistries.  It was therefore cause for celebration when the company reported -2log HBV surface antigen (HBsAg) knockdowns at the World Gastroenterologists Summit, better than with ARC520 and ARC521 before (slides here).  Also, the knockdown was observed regardless of e-antigen status, but that was to be expected with the new sequence design.

Intriguingly, following 3 monthly injections, the knockdown curves still kept coming down, making it almost look like HBV can be beaten into submission by the knockdown effect alone and without the help of an immune boosting effect.

Unfortunately, only HBsAg results from the 100mg and 200mg monthly dosing cohorts were disclosed even though the company had dosed 9 other dosing and patient cohorts.  Based on cohorts 8-11, it appears that best results may in fact have been obtained with the 300mg monthly regimen which will probably be disclosed in the run-up to this year’s AASLD meeting.

Similar to Alnylam in 2014, after showing impressive RNAi target knockdowns in the clinic, the wait is now on to show that the knockdowns will translate into therapeutic benefits.  Given the speed of the company’s execution in general, I would expect pertinent data to emerge from the HBV program in late 2019/early 2020.

Disclosure: similar to Dicerna, I have been recently playing the volatility of ARWR stock, getting long as it had been consolidating around the $14 level, then selling and going short into last week’s 50% spike to a $2B market cap.  With the puts I then sold ($21 and $20 September strikes), I have a ~10% cushion should the stock zoom past $21 by the September options expiration and my max gain is ~13%.  This is intended as a short-term trade

Alnylam's Primary Hyperoxaluria RNAi Drug Clears Patient Hurdle

Alnylam today provided an update on its clinical program of Lumasiran for primary hyperoxaluria (PH), an ultra-rare disease of organ damage and failure due to elevated levels oxalate (here for OxalEurope presentation slides).

The new data include safety and efficacy from all three studied dose cohorts (1 and 3mg/kg monthly, 3mg/kg quarterly) and involved early-stage PH type 1 (PH1) patients without end-stage renal disease and systemic oxalosis.  Accordingly, RNAi knockdown of the target glycolate oxidase (GO) enzyme reduced (urinary) oxalate by ~2/3.

Importantly, this was uniformly achieved across all dosing cohorts, perhaps with somewhat less inter-patient variability for the 3mg/kg cohorts.  Accordingly, oxalate levels were reduced in all patients below a threshold where natural history studies point to an almost complete protection from progression to ESRD. 

Of note, despite the caution that RNAi competitor Dicerna Pharmaceuticals had voiced that GO as a target might be prone to a rebound effect- based on the preclinical observations that oxalate reductions only kick in after profound, ~85% GO gene knockdown is achieved- the new data provide no evidence for this.  Instead, quarterly dosing with 3mg/kg was as good as with monthly dosing of the same dose, consistent with the sustained target-gene knockdown profiles seen with most current GalNAc-RNAi candidates.

The safety profile was unremarkable for a disease like this.  The only obvious drug-related side effect were transient injection site reactions in 2 out of the 9 patients receiving the investigational agent.

With these data in hand, Alnylam is about to embark on a registrational study of Lumasiran in ~25 PH1 patients.  This study will further include younger patients and those with more advanced disease than in the present study.  Given the similarity of the oxalate knockdowns across the cohorts, it is difficult to predict what the dose and dosing schedule will be, but testing both 1mg/kg and 3mg/kg quarterly could be a good idea.

Dicerna competition

Lumasiran is not the only gene knockdown agent in the clinic.  Its closest competitor, ~1.5 years behind based on the May 30 announcement that the 1^st PH patient has now been dosed, is Dicerna Pharmaceuticals’ DCR-PHXC.  DCR-PHXC is differentiated from Lumasiran in that it targets LDHA instead of GO1 and is expected to have a more linear target gene knockdown-oxalate knockdown relationship.  

It is also applicable beyond the PH1 patient population, i.e. also for the less severe (and much less commonly diagnosed) PH2 and PH3 forms of primary hyperoxaluria.

Lumasiran has thus now set a high bar for the commercially currently most valuable patient population.  It will be thus be important for Dicerna to improve diagnosis rates of PH2 and 3 as it intends to embark on a pivotal study in 2019.

Dicerna Supremely Confident About Clinical Pharmacology of its GalNAc Platform

Dicerna has just entered its GalNAc-RNAi conjugates into the clinic and by the looks of it, seems extremely confident about being able to forecast its performance in humans.  

Single-dose study

At least this is what I am forced to interpret into their remarkable decision to merely conduct a single-dose phase I/II study with DCR-PHXC for primary hyperoxaluria before going straight into a planned (multi-dose) pivotal study in 2019.

There is, of course, precedent from Alnylam’s ample experience with a related GalNAc-RNAi conjugate format and how animal studies have translated into humans and how repeat-dosing in man have increased and extended the knockdown compared to single dose administrations.

 

Dicerna thus believes it will be able to predict the optimal dosing schedule for the all-important registrational study based on single-dose monkey-to-human translation and the effect of repeat dosing in monkeys.  

You’ll probably be scratching your head already how accurate such modeling by triangulation can be.  Complicating matters, the primary aim is not to achieve a predetermined level of target knockdown (lactate dehydrogenase A/LDHA), but in fact oxalate knockdown which is downstream from LDHA.

So a lot of moving parts between a single-dose gene knockdown and therapeutic lowering of a toxic metabolite following prolonged and pronounced multi-dose knockdown.  And don’t get me started on the impact of RNAi trigger formats, the nature of their chemical modification as well as the target gene identity on gene silencing duration…and what about the small issue called 'safety'?

Dicerna: if this rushed design is an effort to catch up with the competitive program by Alnylam to better compete for patients for the pivotal trial, it’s probably not worth it.  Either you are greatly increasing the risk of phase III failure or, more likely, you'll be sent back into earlier-stage multi-dose studies by regulators (similar to what happened to the Alport program by Regulus Therapeutics).

Dicerna talking down value of mystery program

Following DCR-PHXC, Dicerna plans to bring two additional drugs into the clinic in the near future: one against HBV and another one for an undisclosed orphan disease.

Aside from the fact that I believe that there is little point in keeping the target identity a secret since they have pretty much given it away by characterizing it as one with >100,000 patients in the US alone (à alpha-1-antitrypsin-related liver disease), it is remarkable that the CEO has said that they are looking for a ‘risk-sharing’ partner at this early stage already.

Even more surprising was the comment last week that Dicerna will even wait to partner the program before entering it into clinical development!  

This truly is unheard of for a company in the red-hot genetic biotechnology space where funding is relatively easy to come by these days for a company of a profile like Dicerna (clinically ready genetic technology, $700M market cap).  Here, the universally accepted name of the game is to get at least a couple of drug candidates into the clinic with minimal ownership dilution (e.g. by partnering) early on.  Developing an orphan candidate to clinical readiness and then idling it sends out a clear signal that the candidate is deemed to have disappointing prospects.

 

It would be easy for Dicerna, with the stock up 100% since the recent offering, to do another ~$100M raise to comfortably navigate three programs through proof-of-concept.

With these two unexplainable apparent unforced major errors, it got me thinking: can it be explained with the uncertainty around the trade secret litigation with Alnylam? According to the Q4 2017 conference call, a trial date has been set for April.

RNAi Companies Ought to Look Beyond Their Platform

This week, Alnylam announced in their roundabout way that it has discontinued the development of ALN-HBV for the treatment of chronic HBV infection.  Instead, it has come to an agreement with well-funded start-up Vir Biotechnology to select a new GalNAc-based RNAi compound, ALN-HBV02, which Vir will largely take control over clinical development.  Alnylam meanwhile retains considerable back-end loaded opt-in rights, milestones and royalties.  

As alluded to in a post last week, ALN-HBV seemed always doomed to fail due to target site selection issues. Also, Alnylam’s heart never really was into ALN-HBV with project leader Sepp-Lorenzino functioning as a one-woman show while competitor Arrowhead mobilized considerable internal and external resources.  She’s, of course, left the company not long ago.

We may never find out the real reasons for their decision although Alnylam would like us to believe that it was a specificity issue since ALN-HBV02 will now be ESCplus-based. Please don't fall into that trap.

My expectation is that ALN-GO1 for primary hyperoxaluria (PH) will suffer the same fate as the initial biomarker data from clinical studies have indicated that likely prohibitively high doses would be necessary to achieve robust oxalate lowering (a modest ~2x increase in glycolate biomarker at a single dose of 6mg/kg).

Once again, a much smaller competitor, Dicerna, has been running circles around RNAi juggernaut Alnylam.  Importantly, it has conducted detailed work on the biochemical pathway of oxalate metabolism and closely studied the natural history of the disease.  The reward was the discovery that the lactate dehydrogenase A (LDHA) is in all likelihood a much better target.

In hindsight it is quite clear that both HBV and PH were only chosen by Alnylam to scare investors away from their competition to cement RNAi dominance.  Not only that, it then filed a frivolous lawsuit against Dicerna alleging trade secret violations.

Will RNAi platform companies have to broaden their tech base?

Given the need to immerse oneself into individual diseases, and also as RNAi is about to open the commercialization chapter, frequently developing drugs for entirely new disease categories served by medicines, a new question arises for the industry: do I remain a platform company or do I have to open my technology base to best serve patient communities and shareholders?

While I do like to criticize Alnylam for shamelessly behaving like the industry's big bully, TTR amyloidosis is one of the diseases they deeply care about.  With 10-20k TTR amyloidosis patients in developed markets, a number that should grow due to increased disease awareness, better diagnosis tools and access, and hopefully prolonged lives, this could well develop into a $5B+ annual market over the next decade.

As the company behind what promises to be the first dominant drug for this disease and a next generation product candidate (ALN-TTRsc02) that should remove any doubt who owns TTR gene knockdown following on its heels, Alnylam would be irresponsible not to try and control the whole patient experience, including complementary non-RNAi treatment options.  In other words, Alnylam would cease to be a pure-play RNAi Therapeutics company while continuing to rely on RNAi for conquering new markets.

This evolution of corporate strategy, of course, is not new to biotechnology and has played out at companies like Vertex Pharmaceuticals (small molecules à cystic fibrosis focus), Biogen (recombinant proteins à multiple sclerosis/CNS focus), and indeed in the Oligonucleotide Therapeutics space before.

Sarepta, once singularly based on morpholino antisense technology, for example has been on a Duchenne muscular dystrophy (DMD) business development spree as their first antisense drug (EXONDYS51) was getting approved.  Sarepta sports a solid >$3B market capitalization illustrating that the financial markets reward such commitment to commercialization and category dominance.

On the other end of the spectrum is Ionis Pharmaceuticals.  

This company is happy to cease control over its groundbreaking compounds and disease insight quite early in their drugs' development paths. Consequently, it finds itself in situations where it either only gets a pittance from breathtaking medical and commercial successes such as SPINRAZA (for spinal muscular atrophy) or it gets caught with their pants down when a partner returns a compound late in the game as has just happened with IONS-TTR/Inotersen and GSK.

The market cap of Ionis, a company that shames $100B+ Big Pharma in terms of its pipeline and which will have close to a dozen compounds on the market and/or in pivotal clinical trials in a year or two, is comparatively paltry: $8B.

And the reason for this?  They are considering themselves a scientific company with a mindset of ‘we are better than organizations with corrupt sales departments’ that is difficult to find even in academia nowadays.  OK, management keeps drawing nice salaries and humongous stock/options rewards, so its really only shareholders that suffer.  

So as much as it hurts me as an RNAi scientists, when it comes to maximizing shareholder returns, the platform serves the purpose of capturing dominant footholds in new disease categories of high unmet needs, but this position has to be fortified by deep relationships with the patient community and an equally deep understanding of disease pathology.  And if necessary, develop and/or license complementary non-RNAi compounds.  

A word on the Arcturus-Janssen HBV deal

In addition to the Alnylam-Vir deal, another HBV RNAi-related deal was announced this week, namely between newly public Arcturus and Big Pharma player Janssen, a unit of Johnson & Johnson.

According to the agreement, Arcturus will work together with Janssen to develop an RNAi drug for HBV utilizing Arcturus’ intravenously administered RNAi triggers formulated in LNPs.   Arcturus uses fancy names for these components, but this is what's behind 'LUNAR' and 'UNA Oligomer Chemistry'. 

Given the availability of potent, but subcutaneous GalNAc-conjugation options in the industry, this interest by Janssen may come as a surprise to some and will serve Arbutus bulls as ammunition in claiming that Arbutus’ HBV RNAi LNP formulation has a future.  A Big Pharma deal after all is a knighthood in the industry.  

Still, I highly doubt it.

It is more likely that similar to Merck which had used LNPs internally as a disease interrogation and target validation tool, but not for commercial development before- even before GalNAc had come to prominence- J&J may view LUNAR-RNAi as a relatively speedy, but inexpensive way to test RNAi for its potential as a backbone therapy in HBV.  If it likes what it sees, watch out for the real deal with Dicerna or Arrowhead.