In an effort to capitalize on the parts of its business that extend into RNAi, antisense firm Isis Pharmaceuticals announced last week that it has formed a strategic alliance with Alnylam Pharmaceuticals. The deal not only provides Alnylam with access to Isis’ chemistry and manufacturing expertise, but also exclusively brings together the two companies’ intellectual property portfolios in a way that Isis said would impact the operations of other RNAi drug developers.
Under the companies’ alliance, Isis has also agreed to purchase $10 million worth of Alnylam’s common stock, which translates into a roughly 5 percent stake, Isis CEO Stanley Crooke told RNAi News. In addition, Isis will provide Alnylam with downstream capabilities for its drug development programs, including process development, bioanalytic methods, quality control, and manufacturing.
Isis has been interested in the RNAi mechanism for many years, according to Crooke. But it was in the last two or three years that “we’ve been specifically interested in understanding how to modify double-stranded oligonucleotides to make them better able to be drugs, and understanding the differences between how double-stranded oligonucleotides take advantage of an siRNA mechanism versus single-stranded RNA oligonucleotides,” he told RNAi News.
Isis’ work in this field has more or less been limited to basic research activities designed to complement the company’s core efforts with single-stranded RNA, Crooke said. For example, he said the company’s work with dsRNA includes “understanding how double-stranded RNases work, what their benefits [are], how they differ from other mechanisms, how to use double-stranded RNases with single-strand antisense drugs … and then doing the medicinal chemistry on those single-strand RNA-like antisense drugs.”
And Isis intends to keep its antisense focus, at least for now, Crooke noted. Nonetheless, he said that Isis’ work over the years has resulted in a significant IP portfolio that directly impacts the RNAi-based drugs field — including the so-called Crooke patents, which Crooke invented and said pre-date the coining of the term RNA interference: These two patents (numbers 5,898,031 and 6,107,094) cover “oligomeric compounds, including oligoribonucleotides and oligoribonucleosides … that activate dsRNase,” and were filed in June 1996 and June 1997, respectively.
As a result, Isis determined that an alliance with an RNAi drugs player would allow it to capitalize on the burgeoning RNAi field without having to directly take part in it. The deal with Alnylam, Crooke said, “is part of a strategy to exploit our patents and our interest in RNA-based drug discovery fully by combining ourselves with companies that have specific, very narrowly focused interests.”
Crooke said that Isis approached various RNAi-based drug developers and “let [them] know that we felt that they were infringing, or potentially infringing, our patents and that we were more than willing to make licenses available on reasonable terms.”
After flirting with the idea of doing a series of non-exclusive deals, and after a review of the RNAi companies and their patent estates, Isis ultimately decided that an exclusive deal with Alnylam was ideal, Crooke said.
“We think that [Alnylam has] the only other intellectual property [aside from Isis] in siRNAs that will be overarching, and the combination of our intellectual property and theirs … creates a very formidable barrier to entry for other companies,” Crooke said.
Bharat Chowrira, Sirna vice president of legal affairs, told RNAi News that that Isis approached his company, but that Sirna passed on forging a licensing deal or partnership. “We looked at their IP [and] we didn’t think there was anything of significance” for Sirna, he said.
“We have a lot of the capabilities that Isis already has — they have chemistry, we have chemistry; they have manufacturing, we have manufacturing,” Chowrira said. “For us, it didn’t really make sense to do a strategic alliance with Isis — we would give them access to our IP in RNAi … [and] they don’t really have much to offer Sirna.”
Under the partnership, Isis has exclusively co-licensed to Alnylam its patent estate related to antisense mechanisms and oligonucleotide chemistry for double-stranded RNAi therapeutics in exchange for a $5 million fee, according to Isis. Additionally, Isis will receive a portion of the fees Alnylam receives through its partnering programs, as well as milestones and royalties on product sales.
Isis will also share in the proceeds from Alnylam’s InterfeRx IP sublicensing program for deals that involve Isis patents. However, Crooke noted that the terms of Isis’ deal with Alnylam restricts sublicenses to ones for research purposes only, and that “one of the objectives of this transaction was to create a formidable intellectual property barrier that is based on the core basic research [of both companies] and use that to facilitate the development of the technology.
“It’s going to be time-consuming [and] costly [to develop RNAi drugs], and having a strong intellectual property position is essential to justify the investment,” he said.
“It’s going to be time-consuming [and] costly [to develop RNAi drugs], and having a strong intellectual property position is essential to justify the investment,” he said.
When asked if an intent of the partnership is to make Alnylam the only RNAi drug company out there, Crooke said, “our intent is to make the combination of Isis and Alnylam absolutely, totally successful, and success, in our vernacular, … is to be totally dominant.”
He declined to comment further, and said that questions about the possibility of patent infringement litigation against Alnylam’s rivals would be better posed to Alnylam.
“Alnylam is responsible for enforcing these patents,” Crooke said. Officials from Alnylam were unavailable for comment as the company continues to be in a quiet period associated with its upcoming initial public offering (see RNAi News, 3/5/2004).
Chowrira said that Sirna isn’t concerned about finding itself blocked by the Isis/Alnylam IP estate.
“Sirna has done its own diligence,” he said. “The investors who invested in Sirna didn’t just invest $48 million without doing their homework.” Chowrira added that Eli Lilly’s decision to strike an oncology partnership with Sirna in January is further validation of the strength of his company’s patent portfolio, largely because Lilly has an ongoing antisense deal with Isis and therefore intimate knowledge of both its partners’ IP estates.
Heading Downstream
While the IP portion of the alliance may be key for Isis, for Alnylam, access to its partner’s downstream capabilities may be the most important aspect of the deal.
Alnylam’s lack of this sort of infrastructure had been one of the key sticking points for the company’s critics. Giving Alnylam access to its know-how “instantly makes them a more mature company and, from our perspective, it only makes sense for us to facilitate our partner’s efforts to get drugs in the clinic,” Crooke said.
“Alnylam didn’t really have a lot of … manufacturing expertise and sophisticated chemistry expertise,” Chowrira noted. “So, it probably made sense to them to do the deal with Isis because they now get some of their expertise from Isis.”
Crooke also noted that the partnership calls for Alnylam to share information with Isis, as well. Under the arrangement, Isis is to pay Alnylam milestones and royalties on any RNAi-based drugs it develops using Alnylam technology.
As such, “it’s a true information- sharing [deal] in addition to our providing manufacturing facilities and so on,” Crooke said.
—DM